
On January 9th 2025, the National Bureau of Statistics in collaboration with the Nigerian Economic Summit Group (NESG) held a workshop on rebasing Nigeria’s Gross Domestic Product (GDP) and Consumer Price Index (CPI). Rebasing means updating the methodology of calculating a country’s economic indices in order to reflect current economic reality.
A lot has changed for Nigerians economically over the last 18 months. The prices of food, transportation, accommodation, and other basic survival needs have gone up at an accelerating pace. People are adjusting by either consuming less or going for lower quality items to meet their physiological needs. This was what informed the decision by the NBS to update its method of calculating inflation, according to Prince Adeyemi Adeniran, the Statistician-General of the Federation.
According to him: “The rebasing is a vital exercise that ensures our economic indicators are current and accurate reflections of the economic realities. As economies evolve, new industries emerge, and consumption patterns shift.” The question then becomes: To what extent will this rebasing exercise reflect the real problem of rising costs and inflationary pressures?
Ever rising costs
Nigeria’s economic environment has been affected by the COVID-19 pandemic and different policies from the removal of subsidies to the devaluation of the currency. Since 2009, the current base year for calculating the inflation rate, several economic policies have emerged and there have been shifts in production and consumption due to those policies. Throughout 2024, for instance, there was a continuous rise in the average price of goods and services. The CPI began 2024 at 660.8 and rose consistently to 847.1 in November 2024, an increase of 28%. This shows how the standard of living of the average Nigerian has been impacted due to constant increases every month.

Due to the rebase, the NBS will release two inflation reports this month, one of which is the CPI for December 2024 which is expected on Wednesday January 15th. When these updated methodologies are factored in, some analysts expect the inflation figure to come down without much change in people’s purchasing power.
Old CPI Weights VS Proposed CPI Weights
Meanwhile, stakeholders are examining the new weights to be given to each driver of CPI according to their contribution to inflation in recent times. Currently, food and non-alcoholic beverages were the major drivers of inflation with 51.8%. Now, the proposed weight is 40.1%, giving priority to other items such as housing, restaurants and accommodation services that have been observed to be important contributors to inflation. This contextualises the fact that foods are becoming more expensive and Nigerians can hardly sacrifice their income to purchase food in the market. So, in that regard, they chose the alternatives, perceived to be less expensive, such as eating outside in places like restaurants, bukas and hotels, which drew the attention of economists and analysts in September 2023.