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From Isaac Anumihe, Abuja
Vice Chancellor, University of Nigeria, Nsukka, Professor Charles Arizechukwu Igwe has picked holes in the calculation of Nigeria’s Gross Domestic Products (GDP), saying that it is not holistic because natural capital is not fully accounted for in Nigeria’s national accounts and policy decisions.
Speaking at a two-day workshop in Abuja, titled: ‘Towards Natural Capital Accounting’, Igwe said that the GDP does not tell the whole story of the status of a country’s economy because the calculation does not take into account the degradation of natural resources and ecosystem services.
“I wish to state that accounting for natural capital following the System of National Accounts (SNA) is accepted globally, given that the Gross Domestic Product (GDP) does not tell the whole story of the status of a country’s economy. This is because the stock of capital, degradation of natural resources (which provide many benefits) and ecosystem services are not generally accounted for in the GDP. ‘However, despite the global acceptance, natural capital is not fully accounted for in Nigeria’s national accounts and policy decisions. They are neither captured in the financial calculation of Nigeria’s wealth nor explicitly considered assets in national planning with the risk that natural capital is degraded over time, resulting in the loss of benefits to the economy” he said.
For Natural Capital Accounts (NCA) to be effective, the VC, noted, there is a need for the government to commit to it, especially in setting up the processes and making available the human resources needed and ensuring that the different agencies work together to facilitate the development of natural capital accounts for Nigeria.
“Also, developing the account is not enough. There is also a need to identify the key issues that the accounts will inform and the types of analysis and modelling that would use the accounting information to facilitate the formulation of evidence-based policies and mainstreaming into national plans and processes” he noted.
According to Igwe, effort should be made by the government and all stakeholders to build on what has been done already.
