By Babajide Komolafe
Managing Partner, Ecovis OUC Nigeria, a firm of chartered accountants, Mr Andrew Uviase, has called for a more transparent approach to Gross Domestic Product, GDP, reporting in the country.
Uviase made this call in a review of the GDP report for the third quarter, Q3’23 released last week by the National Bureau of Statistics, NBS.
The NBS report showed that the nation’s GDP grew by 2.54 per cent, year-on-year, YoY, in real terms in the third quarter of 2023.
”This growth rate is higher than the 2.25% recorded in the third quarter of 2022 and higher than the second quarter 2023 growth of 2.51%,” the NBS said.
However, Uviase expressed concerns over the accuracy of the Q3’23 real GDP figures, and hence advocated for a more transparent approach to GDP reporting.
He suggested that nominal and real GDP figures should be presented in the analysis for easy comparison between periods. He criticised the current practice of providing only percentage growth rates without displaying actual figures, deeming it susceptible to manipulation.
Uviase stated: “The nominal GDP for the third quarter is N60.65 trillion Naira, as against N52.25 trillion in the third quarter of 2022. We are rightly told that the growth represents 16.08% nominal GDP growth in the two periods. Our Statistician says that the real GDP in Q3 is N19.889 trillion, while the corresponding figure for 2022 is N19.294 trillion.
“It is doubtful if the real GDP in 2023 is correct. Given the shocks and inflationary pressure that we have experienced in Q3 of 2023, the real GDP should be about half of the N19.294 trillion. I believe that the figures ought to be more realistic so that policymakers can use them properly.”
Looking ahead, Mr. Uviase expressed a cautious outlook for the last quarter of the year, anticipating that economic challenges, including inflation due to fuel subsidy removal and Naira devaluation, will persist. He predicted nominal GDP growth but expected a decline in real GDP if measured accurately.
“The last quarter of the year is not expected to be significantly different from the third quarter. Economic agents are still battling with the scourge of inflation due to the fuel subsidy removal and devaluation of the Naira. We also have energy costs which have skyrocketed in the current period. My prediction is that nominal GDP will grow but real GDP will decline if measured properly and realistically.”