The country announced its newly rebased GDP figures last week and while officials were pleased with the results, many average Nigerians didn’t see how the figures affected them or how this would improve the quality of their lives.
“What drives development versus GDP and economy is innovation, productivity and technology. Those three things are headlines for me and do we see those three things coming of out Nigeria?” asked Martyn Davies, CEO of Frontier Advisory while speaking to CNBC Africa.
(READ MORE: A closer look at Nigeria's GDP rebasing)
Despite efforts that the Nigerian government is making to diversify the economy, Davies believes that the diversification story is in its early stages and that the country’s power problems must be sorted out first.
“I mean, this is an economy that on its best day will generate no more than 300,000 megawatts with a population that is over three times Africa’s size.”
“How can an economy diversify, build infrastructure without power? It must be one of the poorest countries in the world on a power per capita basis. Let’s move away from GDP, power is the key driver.”
(READ MORE: Has oil-focused Nigeria forgone a diversified economy?)
Meanwhile, the crude petroleum and natural gas sector contributed 14.4 per cent or 11.55 trillion naira to the 2013 rebased GDP, showing that the country is slowly weaning itself off the oil however, it has remained the largest commodity export with 70 per cent of Nigeria’s income.
“Once again, if you strip out its oil exports, which is 87, 89 per cent, Nigeria to me, is nothing more than a petro-state which has the size of a population for fast moving consumer goods (FMCG) play,” he explained.
With a population of over 170 million, and ever increasing demand, the FMCG sector has all the ingredients to thrive in the country. Nonetheless, poverty seems to be on the rise.
“I believe the number of people living in abject poverty has increased in the last decade despite this very strong 7 per cent headline growth,” he said.