The International Monetary Fund (IMF) predicted that Nigeria’s gross domestic product (GDP) was $354 billion last year, making it the second largest African economy behind South Africa. This past Sunday, for the first time in a decade, Nigeria’s statistician-general announced a revision in its GDP from 42.4 trillion naira to 80.2 trillion naira. How could an economy grow so much in just one night?
The reference year for Nigeria's economy’s real growth rate was based from the GDP in 1990. By resetting the base year to a more recent year, Nigeria made the new GDP figures more accurate. Since 1990, Nigeria’s economy has changed a lot. For example, Nigeria had one telecommunication company in 1990, but now it has over a dozen. Over the past decade, Nigeria’s economy has matured and grown to develop industries such as telecommunications, energy, and entertainment. Now many more companies are included in the GDP calculation, including small businesses.
Although Nigeria’s economy is prone to corruption, there are still many opportunities for foreign investment. According to a U.S. Commercial Service report, the fastest growing industries in Nigeria include infrastructure development and technology for sectors such as security, power generation, transportation, and healthcare. The Nigerian government continues to privatize many of these industries in order to sustain annual growth. There are many strategic alliances and ventures with foreign firms for businesses looking to invest in Nigeria.
There may be more opportunities to invest in Nigeria for foreign businesses. As shown with its recent GDP revision, Nigeria’s economy is continuing to grow and mature. For more information on Nigeria, please visit globalEDGE’s country insight page!