6 April 2014

Africa: Nigeria 'Overtakes' South Africa As Continent's Largest Economy

Photo: Daily Trust
Nigerian Telecom installation

Nigeria has overtaken South Africa as the continent's largest economy, according Nigeria's statistics agency. It said its fresh calculation had shown nearly a doubling of Nigeria's gross domestic product.

The Gross Domestic Product (GDP) for Nigeria was 80.3 trillion naira ($509 billion, 369 billion euros) in 2012, the country's statistics bureau said on Sunday.

That is nearly double the previous estimate of 42.3 trillion nairo assumed before the so-called rebasing, and far above South Africa's 2012 result of $384 billion.

The new calculations take into account changes in output in consumption since the last time Nigeria had done a GDP calculation in 1990.

Nigeria's new GDP value includes previously uncounted sectors such as digital telecommunications, information technology, music, airlines, online retail outlets and the hugely popular local film industry, Nollywood.

"Nigeria has moved to be the largest economy by GDP-size in Africa and has moved to be the 26th largest in the world," finance minister and former World Bank managing director Ngozi Okonjo-Iweala said.

Some experts skeptical

Economists warned, however, not to take Nigeria's new figures at face value, given that South Africa - the continent's only G20 member - was still far ahead in terms of infrastructure. Ordinary Nigerians live on less than 2 dollars a day.

"The exercise is a journey from reality to vanity," said Bismarck Rewane, a Lagos-based derivates specialist.

Finance Minister Okonjo-Iweala said on a per capita basis "Nigeria is number 121 in the world." "So, we have a total GDP size where we have moved up to 26th," she said.

Africa's largest population

Nigeria, which has Africa's largest population at 170 million, has seen high rates of economic growth. According to the International Monetary Fund (IMF), the country had an annual average growth of 6.8 percent from 2005 to 2013, with the rate expected to rise to 7.4 percent this year.

The country has become an increasingly attractive destination for foreign investors; however it still struggles with widespread corruption, poor governance, rampant oil theft and a violent Islamic insurgency in the north,

- AFP, AP, Reuters

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