Nigeria replaces S. Africa as continent's largest economy

Nigeria’s central bank said the fastest growing segments were wholesale and retail trade, and telecommunications

Nigeria replaces S. Africa as continent's largest economy

World Bulletin/News Desk

Nigeria is likely to take South Africa’s position as the continent’s largest economy within two years, a Reuters poll found.  

Nigeria’s gross domestic product will receive an enormous boost when it is rebased later this year to more accurately reflect changes in the economy over the last two decades. The much-delayed rebasing could add up to 50% to Nigeria’s economy, giving it a nominal GDP of around $375bn which is almost the size of South Africa’s.

Strong domestic demand and high levels of agriculture and services activity will see it clinch the title of Africa’s biggest economy within a couple years if current growth rates are maintained. High unemployment and a slowdown in the euro zone, South Africa’s main trading partner, make it vulnerable to losing its number one spot. It is set to grow at just 2.6% this year.

It must be noted, however, that while being number one in the continent may boost Nigeria’s profile, South Africa still enjoys a better GDP-per-capita ratio compared to Nigeria, and therefore a slightly better standard of living.

The Nigerian economy has been growing faster than the South African economy for some years. In 2012 Nigeria's economy grew by 6.6% while South Africa's grew only between 2-3%.

Nigeria’s central bank said the fastest growing segments were wholesale and retail trade, and telecommunications. Nigeria’s 170 million people make it the most populous country in Africa and the seventh-biggest in the world.

This creates a massive market, attracting investment from across its borders, including from South Africa, which is becoming increasingly aware of the opportunities in servicing this population.

In contrast, South Africa’s population is estimated at 51.1 million (5.7 percent of the population in sub-Saharan Africa), making it the fifth most populated country in Africa.

Last Mod: 12 Kasım 2013, 15:15
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