BusinessDay... the voice of business: Renaissance Capital predicts N35 trillion GDP for Nigeria by 2010

Renaissance Capital predicts N35 trillion GDP for Nigeria by 2010
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NSE AKPAN on 04 May, 2008 02:00:00
 
Nigeria’s Gross Domestic Product (GDP) valued at level prices would likely hit
N35 trillion ($300 billion) in the next three.
Renaissance Capital, (RenCap) a leading international finance group, in its
recent report on Nigeria noted that the country’s GDP would increase by 79.5
percent in the next three years from N19.5 trillion ($166 billion) in the end of
2007.
Compared to the figures released by the National Bureau of Statistics (NBS),
the 2010 GDP forecast
would represent a 52.8 percent increase. NBS has earlier given an estimated
value of N22.91 trillion ($197.5 billion) as the country’s GDP in 2007.
According to the NBS, country’s GDP rose by 23.39 percent to N22.91 trillion
from N18.57 trillion in 2006. The implication is that, the value of total goods
and services in output within the period has increased by additional N4.34
trillion. $197.5 billion.
The government agency had also estimated real GDP growth rate to be 7.64
percent for 2007 as against 5.63 percent recorded in the preceding year.
However, Andrew Cornthwaite,  RenCap’s chief executive officer for Nigeria,
said the country’s GDP could grow at between 12 and 15 percent per annum if
issues like power and infrastructure were fixed.
Nonetheless, he said the country was growing well at the current rate in spite
of the infrastructural and political problems.
The RenCap report also forecast that GDP would expand by as much as 9.1 percent
in 2008, following growth of 6.3 percent in 2007.
“This was higher than expected given that the Yar’Adua administration took
time to settle in after the April elections, and civil strife in the Niger Delta
region caused oil-output disruptions.”
It however noted that a political settlement of the Niger Delta crisis, the
cost of which is estimated at about $60 billion since the early 2000s, will be
crucial to boosting development in the short and medium term.
The country report titled: “Nigeria: On the Eve of a Breakthrough”, which
was released on last Wednesday, Renaissance Capital said the longer-term outlook
would be constrained by infrastructural  under-development, especially in
electricity as well as ageing infrastructure, particularly in the oil sector.
The finance company said recurring drops in electricity generation and
distribution are a reminder of the scale of power infrastructure
under-development, noting that about 57 per cent of the Nigerian population does
not have access to electricity according to a survey of the International
Centre for Energy, Environment and Development. It said this was in spite of
the more than $10 billion spent by government to upgrade the sector’s
infrastructure.