Audio: How Recalculating GDP Can Help Entreprenuers Attract Investment In Nigeria

Marianne McCune discussing on the National Public Radio:

Bayo Puddicombe and Zubair Abubakar own a company called Pledge 51, which creates applications for Nigeria’s low-tech cellphones. One of their most popular games lets players pretend to drive the notoriously wild buses crisscrossing the Nigerian city Lagos. It’s called Danfo, after the buses.

These guys think they can make a lot of money for some savvy foreign investors. But one of the biggest challenges they face is that on paper, Nigeria’s economy doesn’t look as good as it should. The reason: For more than two decades, Nigeria has been estimating its gross domestic product using data collected in 1990. A lot has changed in the world since then (hello, cellphones), but Nigeria’s GDP calculation hasn’t kept up.

Nigeria has plans to fix this problem by using data from a more recent and relevant year, what economists call rebasing. And this change could make Nigeria’s economy No. 1 in sub-Saharan Africa — surpassing South Africa. That could mean a lot more investment for the team at Pledge 51.

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