Nigeria’s Push for Sustainable Economic 

Growth Through Natural Capital Accounting

Nigeria needs to get everything ready for an economic boom, and one of the avenues to this is to get its environment ready and working for the benefit of all, which the Natural Capital Accounting stands for, reports Michael Olugbode

Nigeria continues to grapple with the impact of environmental disasters, both natural and human-induced. Annual flooding, heatwaves, drought, erosion, deforestation, and the shrinking of Lake Chad threaten lives, livelihoods, and ecosystems.

While the full economic cost of these disasters remains unclear, one thing is certain: both people and nature are under constant threat. 

Experts argue that to address this challenge, countries must begin to assign value to their natural capital—resources that traditional economic measures like Gross Domestic Product (GDP) often overlook.

In response, Nigeria, one of Africa’s largest economies, embraces Natural Capital Accounting (NCA) as a pathway to sustainable economic growth.

What’s NCA, and Why Does It Matter?

According to the National Bureau of Statistics (NBS), NCA captures the economic contributions of natural assets, such as forests, minerals, water, and biodiversity, while also factoring in their depletion or degradation.

NCA aims to fill a critical gap left by traditional economic indicators like GDP, which do not measure the environmental costs or benefits of economic activities.

Speaking at a webinar in November 2024, Head of National Accounts at the NBS, Baba Madu, described NCA as “a systematic approach to measuring and valuing a country’s natural resources and the ecosystem services they provide, integrating their values into national accounts to inform low-carbon, climate-resilient development.”

Push for Institutionalisation of NCA

Nigeria is currently working with the World Bank’s Global Programme on Sustainability (GPS) to enhance its capacity for NCA and to integrate environmental values into policy and investment planning.

Ahmed Abdullahi, an environmentalist with the World Bank, said natural capital accounting provides a more holistic view of economic health by quantifying the value of natural resources.

“It is already being used to monitor environmental degradation and guide restoration efforts, forming the basis of our forestry intervention planning,” he said during a recent training for journalists on NCA.

With support from the GPS, Nigeria has developed national land accounts, ecosystem accounts in Nasarawa and Kaduna states, and conducted analyses on tree cover loss and greenhouse gas emissions. An ongoing study is exploring the links between poverty, gender, and natural capital.

These efforts are being coordinated by the NBS, with contributions from the United Nations Statistics Division and a multi-agency technical working group. A high-level NCA Forum is scheduled for June 2025.

According to Abdullahi, the work is already influencing development planning in sectors like watershed management, landscape planning, and climate-smart agriculture.

“We have both national and sub-national stakeholders involved,” he added, citing the participation of federal ministries, NASDA, the National Council on Climate Change, and state governments.

“NCA allows us to embrace natural resources beyond traditional GDP. It showcases the true picture of our economy, including forests, land, and water resources.”

For most stakeholders, there is a need to institutionalise NCA in Nigeria for maximum optimisation of its potential to attain sustainable growth and boost the country’s GDP.

At the Natural Capital Accounting conference organised under the World Bank’s Global Programme on Sustainability (GPS), aimed at enhancing Nigeria’s capacity for natural capital accounting, held on June 5, experts in the environment sector explored ways the country can take advantage of the NCA.

The theme of the conference was “Developing and establishing natural capital accounts.”

Vinay Vutukuru, the Programme Lead on Sustainable Development at the World Bank, stressed the need for stakeholders to jointly explore the vital role of national accounting in development plans and brainstorm on how it could be institutionalised.

Vutukuru noted that the conference was part of the technical assistance that the World Bank has provided to the Nigerian government and its groups on national capital accounting for the last two years.

“I think, I’m sure all of you will agree that establishing the national capital accounting as part of the national account system will allow us to measure the economic value of ecosystem services such as clean air, water, and biodiversity, which are essential for our well-being and economic prosperity,” he said. 

“And this process of the development of accounts was supported by the experts of the World Bank and UNSD through a very close collaboration with the government’s working groups, and I think on behalf of the World Bank, I want to thank the government’s working groups for the great collaboration commitment.”

He noted that Nigeria has very bold ambitions as far as responding to climate change is concerned and described them as “really laudable”.

“You’ve committed to net zero in terms of emissions by 2060. You’re saying that even in unconditional support by 2030, you would be able to reduce emissions by 20 per cent,” the World Bank expert praised Nigeria.

“So, all of this is great, laudable, and very appreciative kind of commitments made by the government of Nigeria, and that shows the commitment of the policymakers here towards the issue of climate.”

He said the country needs “a very strong natural account system” to back up its aspirations and the aggressive goals that have been set.

“I think without a very strong foundational natural account system, the first thing is that maybe Nigeria won’t even be able to measure whether they have got there or not,” he quipped.

Citing ongoing efforts by the World Bank to support Nigeria in institutionalising NCA, he said the financial institution has developed ecosystem accounts for two states in the country. 

“We’ve done the land accounts, we’ve done GHG accounts in 2018,” he added, and noted to the need to institutionalise the efforts so that they become part of the everyday function of the national ministries, the National Bureau of Statistics (NBS), the ministry of environment and the National Climate Change Council (NCCC).

Also, the head of the department of national accounts, energy and environment at the NBS, who was at the conference, noted that NCA in Nigeria has been evolving steadily over the past six to seven years. 

Madu said significant progress has been made with the recent expansion of broadband and digital infrastructure, adding that a steering committee was inaugurated to guide the process. 

“This committee is chaired by the Secretary to the Government of the Federation and the Chief Executive of the National Bureau of Statistics, with representation from relevant ministries and departments,” he said.

He said the committee would ensure seamless coordination and synergy across all relevant agencies. 

“These agencies are expected to work collaboratively—collecting data together and aligning towards a shared objective. NCA has been tasked with the crucial role of integrating natural capital into economic measurement,” Madu added.

According to him, it is impossible to measure the economy accurately without accounting for natural resources.

He noted that issues such as environmental degradation, deforestation, desertification, and climate change all directly impact productivity.

“Productivity, in turn, influences output—one of the core components of the Gross Domestic Product (GDP). These environmental factors must be reflected across all economic activity sectors to present a more accurate picture of national output,” he explained.

“In line with global best practices under the system of national accounts (SNA), Nigeria is preparing to adopt the updated 2025 SNA framework, which is scheduled for implementation in 2026. 

“The timing aligns well with Nigeria’s current developmental agenda and efforts to modernise economic data systems.”

Olaide Aderoju, a research engineer at the National Space Research and Development Agency (NASRDA), said the availability of data on areas prone to natural disasters helps in planning ahead of such occurrences.

“The moment you start having signs of such disasters coming, you start evacuating people,” Aderoju said.

The Director-General of the National Council on Climate Change (NCCC), Nkiruka Maduekwe, said natural resources have been a very vital instrument in achieving the nationally determined contributions (NDC).

“And again, natural resources have also been a very vital instrument in achieving the NDCs and also the NAP document,” Maduekwe said.

They don’t only serve as sinks. They also serve as materials for developing adaptation and mitigation activities within what we’re doing in issues of climate change.”

Represented by Chioma Azie, Head of Media at NCCC, Maduekwe commended the World Bank for its role in deepening the NCA understanding and institutionalisation in Nigeria.

“The World Bank has done very well. They have led this process several times,” she said.

“You know, the council is quite young, but our role can always be coordination—making sure that the stakeholders are properly mapped to champion the activities across the nation, and also to help NBS develop a very crystal-clear template that speaks to the needs of data that will be coming from the natural NCA.”

As Nigeria charts a new course toward sustainability, natural capital accounting offers a promising framework for inclusive growth that values both economic output and environmental health.

But for this vision to succeed, it will require continued collaboration between government agencies, international partners, civil society, and a well-informed media equipped to tell the full story.