Nigeria Surpassed South Africa As The Biggest Economy In Africa
Nigeria took the position of South Africa as the largest economy in Africa.
South Africa as the biggest economy in the whole of African countries has been rocked with another recession.
South Africa fell into its second recession in as many years at the end of last year as severe power blackouts defeated President Cyril Ramaphosa’s efforts to revive growth in the continent’s most industrialised nation.
The economy contracted by 1.4 per cent in the fourth quarter compared with the previous three months, official statistics revealed on Tuesday, far outpacing analyst forecasts of a 0.2 per cent decline.
The contraction came after a 0.8 per cent drop in the economy during the previous quarter, leading to South Africa’s second recession since 2018.
Financial Times Report.
According to the Bloomberg “Nigeria, South Africa make up half of sub-Saharan Africa’s GDP”
it’s now a prevailing objective reality that South Africa, the number 1 African economy is rated as the second-largest economy in Africa.
“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.”
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.
In South Africa, the reverse is the case.
It went 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 world 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.
With the current analysis, the Nigeria’s economy will keep going up faster.
Whereas, the International Monetary Fund IMF, cut its forecast for Nigeria’s 2020 growth to 2% from 2.5% in February owing to the lower oil prices, South Africa’s GDP is predicted to expand only 0.8%.
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