fbpx
Wednesday, July 8, 2020

Nigeria Overtakes South africa as the Biggest Economy in Africa

Must Read

Zimbabwe Spends Millions of Dollars on Luxury Cars as the Country Goes Hungry

The government of Zimbabwe has spent millions of dollars on luxury cars for senior officials despite a deepening economic...

Akodessewa Fetish Market – The Largest Voodoo Market in the World is Located in Togo

Akodessewa Fetish Market in Lome, Togo is recognized as the largest fetish market in the world, a place where...

Dust Pollution Linked to Infant Mortality in Sub-Saharan Africa

Researchers at Stanford and University of California San Diego have collaborated on a new study, published recently in Nature...



The giant of Africa, ‘Nigeria’ has overtaken South Africa as the biggest economy in Africa as the latter slid into its second recession in two years, Bloomberg reports.

Nigeria Overtakes South africa as the Biggest Economy in Africa

South Africa’s economy slumped into a second recession in consecutive years, contracting more than projected in the fourth quarter as power cuts weighed on output and business confidence. For the full year, expansion was 0.2%, the least since the global financial crisis, and even less than the central bank and government estimated. Based on a average rand-dollar exchange rate of 14.43 for the year, GDP was $352 billion.

Figures from Statistics South Africa (Stats SA) showed that agriculture, transport and construction contracted on a quarterly basis by 7.6%, 7.2% and 5.9% respectively, while electricity declined by 4% and retail 3.8%.

Overall, the country’s economy grew only 0.2 percent in 2019, the least since the global financial crisis, and even less than the central bank and government estimated, reports
Bloomberg.

Nigeria’s economy, however, rose by 2.27 percent in 2019 as the central bank took measures to boost credit growth while oil output increased.

The West African country’s economy expanded the most in four years in 2019, with its growth beating projections in the fourth quarter, said Bloomberg.

Nigeria’s economic growth beat forecasts in the fourth quarter, helping its economy to expand the most in four years in 2019 as oil output increased and the central bank took steps to boost credit growth. GDP in the West African country stood at $476 billion or $402 billion, depending on the rate used.

MORE:   Belgian King Expresses 'Regrets' for Suffering of the Congolese People During the Colonial Period

Projections show Nigeria’s economy will continue to grow faster. While the International Monetary Fund cut its forecast for Nigeria’s 2020 growth to 2% from 2.5% last month due to lower oil prices, South Africa’s GDP is forecast to expand only 0.8%.

MORE:   Belgian King Expresses 'Regrets' for Suffering of the Congolese People During the Colonial Period

Nigeria and South Africa account for almost half of sub-Saharan Africa’s gross domestic product. To determine which of the two countries is the biggest economy on the continent has long depended on the exchange rate one uses for Nigeria.

“But now both the official naira rate of 306 per dollar and the weaker market exchange rate of around 360 that almost all investors use put Nigeria on top,” according to Bloomberg.

In the fourth quarter, Nigeria’s GDP stood at $476 billion or $402 billion, depending on the rate used while South Africa’s was $352 billion, based on an average rand-dollar exchange rate of 14.43 for the year.

South Africa has been in energy deficit since 2005 following the mismanagement of its power utility Eskom which has failed to meet demand. Frequent blackouts continue to have a toll on businesses, further impeding economic growth.

At the moment, Nigeria’s economy is expected to continue to grow faster than South Africa’s. The International Monetary Fund has cut its forecast for Nigeria’s 2020 growth to 2 percent while South Africa’s GDP is forecast to expand only 0.8 percent.

Meanwhile, Nigeria’s governing APC party has welcomed the news of the country’s reemergence as Africa’s biggest economy.

The National Publicity Secretary of the party, Mallam Lanre Issa-Onilu, in a statement , said since the Nigerian economy exited recession in 2017, the country’s economic growth has not been a fluke but a result of deliberate practices and policies of the Buhari administration.

MORE:   Negro Dogs: How Vicious Dogs Were Used To Track, Attack, And Capture Runaway Slaves

He said this “has increased transparency in governance, diversification of the economy away from oil, improved fiscal management and a healthy protectionist approach which has aided the growth and increased the capacity of domestic producers and in turn, created jobs.”

South Africa slumped to its second recession in two years

Nigeria, South Africa make up half of sub-Saharan Africa’s GDP

As if a recession wasn’t enough bad news for South Africa, it’s now confirmed as the continent’s second-largest economy.

The answer to the question of whether South Africa or Nigeria, the two countries that account for almost half of sub-Saharan Africa’s gross domestic product, is the biggest economy on the continent has long depended on which exchange rate you use for the West African nation. But now both the official naira rate of 306 per dollar and the weaker market exchange rate of around 360 that almost all investors use put Nigeria tops.

Number One

— With assistance by Paul Wallace



Uzonna Anele
Anele is a web developer and a Pan-Africanist who believes bad leadership is the only thing keeping Africa from taking its rightful place in the modern world.

Just In

Zimbabwe Spends Millions of Dollars on Luxury Cars as the Country Goes Hungry

The government of Zimbabwe has spent millions of dollars on luxury cars for senior officials despite a deepening economic...

Dust Pollution Linked to Infant Mortality in Sub-Saharan Africa

Researchers at Stanford and University of California San Diego have collaborated on a new study, published recently in Nature Sustainability, that explores how dust...

World Bank to Lend 50 Billion USD to Sub-Saharan Africa in 2020

The World Bank said Wednesday it will lend 50 billion U.S. dollars to 48 countries in Sub-Saharan Africa this year. The Bank said the loan...

Algeria Buries Skulls Of Resistance Fighters Beheaded by French Forces During the 1800’s

The skulls of 24 Algerian anti-colonial soldiers, beheaded by French forces during colonial France's conquest of the North African country that had been lying...

More Articles Like This