This “rebasing” raised Nigeria’s nominal GDP – the value of all goods and services at current prices – to N372.8-trillion (about US$243.3-billion) for 2024, a 34.4% increase from the earlier estimate of N277.5-trillion (about $188-billion).
Even so, the new figure fell short of president Bola Tinubu’s economic adviser Dr Tope Fasua’s claim that “this economy is at least a $350-billion economy”.
Predictions that rebasing would restore Nigeria’s position as Africa’s largest economy also proved wrong. Nigeria briefly held that title after its 2014 rebasing, which changed the base year from 1990 to 2010.
Following the latest update, it remains the continent’s fourth largest economy, behind South Africa, Egypt and Algeria.
Why the recent GDP rebasing?
The statistics bureau says adjusting how it calculates GDP is essential to reflect economic realities.
“As economies evolve, new industries emerge and consumption patterns shift, it becomes imperative to update our statistical measures to capture these changes,” said NBS chief executive Adeyemi Adeniran at a January 2025 workshop with the Nigerian Economic Summit Group.
“Rebasing our GDP and CPI [consumer price index] allows us to align with these transformations, providing a more precise and relevant picture of Nigeria’s economic landscape,” he said.
Adeniran said the rebasing was “foundational to informed policymaking, strategic planning, and effective governance”.
Dr Baba Madu, the head of national accounts at the NBS, told Africa Check they had used national surveys to capture data from all parts of the country, including many economic activities “that were either under-reported or not captured before”.
“For instance, we tried to capture the activities of herdsmen who move with cattle from place to place and many other activities in the informal economy,” he said.
“The rise in digital technology has also generated many economic activities in Nigeria, for instance, e-commerce and services such as Uber. The rebasing aimed at capturing all those economic activities.”
The newly added economic activities fall into three broad groups:
- Digital economic activities: including fintech, e-commerce and other online services.
- Emerging sectors: modular refineries, pension fund administrators and quarrying industries.
- Social programmes: including the National Health Insurance Scheme and the Nigerian Social Insurance Trust Fund.
Why now? Politics or measuring real growth?
Madu told Africa Check the rebasing was overdue and necessary to keep Nigeria’s GDP figures in line with international best practices.
“The previous rebasing of the GDP moved from 1990 as the base year to 2010, a period of 20 years. This one is nine years, from 2010 to 2019. But we should have rebased before now,” he said.
The United Nations Statistical Commission’s System of National Accounts 2025 recommends countries rebase their economies every five or 10 years.
The changes also drew criticism. Hassan Oaikhenan, a professor of international economics at the University of Benin, southern Nigeria, told Africa Check the rebasing was an abuse of statistics driven by political motives.
While it captured underreported sectors and updated GDP figures, he argued the government should focus instead on improving healthcare, education, infrastructure and jobs. “These are the things that can lead to real economic growth and an improved standard of living for Nigerians.”
Not quite the figure the government was looking for
Fasua, the president’s top economic aide, argued the rebased GDP figure of N372.8-trillion was conservative, citing major changes in the petroleum sector, growth in fintech, real estate, manufacturing and the stock market. He said this should have pushed Nigeria’s GDP above Algeria’s.
At a stockbrokers workshop in the capital Abuja, Fasua questioned why GDP growth stayed around 3% despite states increasing their internally generated revenue by 100 to 300%.
The federal government said data gaps between the NBS, states and local governments might have led to underreporting of economic activity.
But economist Sheriffdeen Tella of Olabisi Onabanjo University in southwest Nigeria said repeated naira devaluations made it unrealistic for Nigeria to reclaim Africa’s top economy spot.
”At the current exchange rate, it is difficult for Nigeria to compete with other large economies in Africa,” Tella said.
Elements of the rebasing
After a sharp 6.96% contraction in 2020 due to the Covid-19 pandemic, Nigeria’s economy has grown every year since. Real GDP, which includes inflation, rose by 0.95% in 2021, 4.32% in 2022, 3.04% in 2023 and 3.38% in 2024.
The latest GDP data, for the first quarter of 2025, shows a year-on-year growth of 3.13%, from 2.27% in the same period of 2024.
The NBS divides Nigeria’s economy into three main categories: services, agriculture and industries. In 2024, the rebased figures show services leading with 55.5% of GDP, followed by agriculture at 27.8% and industry at 16.7%.
This confirms that services remain the main growth driver, while manufacturing's share continues to shrink.
What are the leading sectors in 2024?
After the rebasing, crop production, trade, real estate, telecommunications and crude oil and gas emerged as Nigeria’s top five sectors.
The first four alone make up almost 60% of the economy, underscoring how much it has diversified.
Notably, real estate now contributes more to GDP than oil and gas.
Drugs, sex work and other illegal activities now counted
One notable change is that the NBS now factors illicit activities, including trade of illegal drugs, sexual services and smuggling, into GDP calculations.
“We are capturing these illegal activities, such as the drugs seized by the National Drug Law Enforcement Agency,” the bureau’s Madu told Africa Check.
“We need to know the value of such activities, but we are not encouraging them. We shouldn’t be talking about them because they make up less than 2% of the economy.”
CPI rebasing: what’s the effect on inflation?
Alongside the GDP rebasing, the NBS also rebased the consumer price index (CPI), the measure used to calculate inflation. The base year changed from 2009 to 2024.
The CPI basket will expand from 740 to 960 items, to include insurance and financial services.
This update saw inflation drop sharply, from 34.8% in December 2024 to 24.48% in January 2025, nearly 10 percentage points lower.
NBS said 2024 was chosen to capture major structural changes, including the removal of subsidies on petrol, electricity and foreign exchange.
Implications on living standards, debt and taxes
While the rebased GDP is 34% higher, this doesn’t mean the economy suddenly grew or that Nigerians’ living standards have improved.
No real economic growth had happened, Oaikhenan, professor of international economics at the University of Benin, told Africa Check.
“It is more like looking better on paper, while Nigerians face harsh economic realities.”
The larger GDP lowers Nigeria’s debt-to-GDP ratio, giving the government more space to borrow without breaching the 40% threshold set by the debt management office.
The World Bank’s recommended ceiling is 55%, while the Economic Community of West African States sets a 70% benchmark to help keep member states stable.
The tax-to-GDP ratio has also fallen despite earlier gains from Tinubu’s tax reforms, showing that a bigger GDP doesn’t automatically translate into higher tax revenue.
The government says it must significantly boost collections in 2025 to match the 13.5% tax-to-GDP ratio the country recorded in 2024.
(Note: Read our factsheet on Nigeria’s new tax reforms and how they affect you.)
Manufacturers are not cheering just yet
The Manufacturers Association of Nigeria (MAN) said the GDP rebasing had exposed a worrying trend – a less productive economy with a shrinking industrial base.
Manufacturing’s share of GDP had fallen from 27.65% in 2014 to 21.08% in 2024, with the sector contracting by 0.76% between 2019 and 2024.
According to media reports, in 2023 alone about 767 factories closed and 335 were in distress. Power shortages, limited access to affordable long-term financing, poor trade logistics, high input costs and policy inefficiencies were among the reasons.
MAN’s director-general, Segun Ajayi-Kadir, warned that Nigeria was shifting from production to low-value services, which risked undermining inclusive growth.
“The rebasing confirms that Nigeria’s economy may be statistically larger, but it is not more productive, nor more industrialised. Without a strong industrial base, GDP expansion may just become a hollow statistic,” Ajayi-Kadir said.
Economist Tella said the rebasing underscored the need to invest in production and strengthen manufacturing, rather than consumption.
“With services growing and manufacturing declining, Nigeria’s economic growth would be stunted,” he said.
“That is the difference between China’s economy and that of India. China’s economy is driven by manufacturing, while that of India is driven by services. China’s GDP is significantly larger than that of India. But we seem to be following the Indian model, which is not good for us,” he said.
He said that services, dominated by finance and information and communications technology, didn’t create as many jobs as manufacturing.
“If manufacturing grows, it will pull up agriculture and the services sector, create jobs and more Nigerians will be better off. The government would get more tax revenue,” Tella said.
Tinubu’s sweeping oil, gas and tax reforms have significantly increased government revenue. But it could be argued that the fallout has been economic hardship, with Nigerians facing a steep rise in the cost of living.
