Nigeria’s statistical agency has announced plans to include illegal and informal economic activities in the country’s gross domestic product (GDP) calculations, aiming to better capture the true size of its economy.
The National Bureau of Statistics (NBS) said the move reflects changing economic realities and will provide a more accurate estimate of Nigeria’s economic output, which measures the value of goods and services produced.
Expanding the Scope of GDP
Moses Waniko, a senior official at the NBS, explained that activities without legal backing—such as black-market operations—would now be considered in the GDP.
“Practitioners in these sectors earn income and contribute to the formal economy indirectly,” Waniko said on Thursday, adding that the changes could reveal a larger economy than previously estimated.
The new calculations will use 2019 as the base year and will also include emerging sectors such as the digital economy, health and social insurance, modular refineries, mining, and households employing labor.
Nigeria, once Africa’s largest economy until 2022, is currently ranked fourth, according to International Monetary Fund data, behind South Africa, Egypt, and Algeria.
The country’s last GDP revision was in 2010, and officials believe the update is overdue.
Oil Sector Decline
The contribution of Nigeria’s crude oil sector to the economy has diminished significantly, dropping from third to fifth place. Agriculture and trade remain the largest sectors, with real estate now ranking third.
Waniko noted that the revised GDP would likely impact key indicators such as the tax-to-GDP ratio, debt-to-GDP ratio, and per capita income.
“This exercise is expected to show that Nigeria’s economy is bigger, reflecting a more comprehensive picture of our economic activities,” he added.