The South African economy has been predicted to bypass Egypt’s and Nigeria’s to become the biggest on the continent.
THE SOUTH African economy has been predicted to bypass Egypt’s and Nigeria’s to become the biggest on the continent.
This is according to the International Monetary Fund (IMF) in its World Economic Outlook.
The country happens to be Africa’s most industrialised nation. Its gross domestic product (GDP) is expected to reach $401 billion in 2024, compared to $395 billion in Nigeria and $358 billion in Egypt at the current price.
This current price refers to the most recent selling price of an exchange-traded funds currency, product or precious metal. It is the most dependable indication of the securities’ current value.
Economist Yvonne Mhango told Bloomberg that she believes the IMF’s predictions reflect where it expects real changes to take place.
“South Africa’s transient emergence as Africa’s largest economy in 2024 is mainly due to the shrinking of Nigeria and Egypt’s GDP in dollar terms, following sharp currency devaluations.
“However, the long-term trajectory shows Nigeria and Egypt regaining their top spots, with the former taking a strong lead. For Nigeria to realise the GDP expansion projected by the IMF, we think oil output must be restored to its potential, insecurity needs tackled, and the bottlenecks in the power sector addressed,” she was quoted as saying.
SA is projected to hold this top spot for only one year as Nigeria and Egypt are set to pull their socks up.
According to the analysis, Nigeria will subsequently overtake South Africa as the continent’s biggest economy in 2026.
In addition, South Africa reportedly possesses the potential for even quicker development, anywhere from 2.5% to 3%, if it handles its electrical supply problems, removes logistical obstructions, and implements other required changes.