Oh no! Nigeria has overtaken South Africa as Africa’s largest economy. The long-awaited release of yesterday’s recalculated report on Nigeria’s gross domestic product (GDP) data shows that their economy is around double that of previous estimates.
In fact the West African country overtook South Africa a while ago, but it has taken a while to update its statistics. While most countries revise their GDP calculations every few years to adequately reflect the changes in output and consumption, Nigeria hadn’t updated its calculations since 1990…so its film industry and e-commerce, for instance, have only now been factored in! (In future, the Nigeria Bureau of Statistics has agreed that the base year will be re-calibrated every five years.)
The revised statistics mean that Nigeria’s GDP is almost double the 43.3 trillion naira that had been estimated before. It is actually 80.3 trillion (equivalent to US $509.9 billion). The country’s debt-to-GDP ratio also shrank for 19 % in 2012 to 11 % for 2013.
Nigeria’s success can be attributed to the following:
- It’s the most populated country on the continent – with over 170 million people – so the size of its consumer market and its growing sophisticated capital markets have attracted an increasing number of foreign investors.
- The success and growth of its film industry (nicknamed “Nollywood”).
- Its mobile phone industry has taken off. Back in 1990, there were 300,000 landlines. Today the country has 100 million cellphone users.
- It is Africa’s top oil producer.
Nigeria was pressured to update their stats by foreign investors who are still cautious in investing in the country because of instability in the region – including a heated build-up for the elections in February next year, as well as trouble brewing in the northeast with an insurgency being waged by Islamist sect Boko Haram. Investors also weren’t impressed by the suspension of the central bank chief – by President Goodluck Jonathan – after he publically queried large oil revenue leakages from the state oil firm.
Upon hearing that Nigeria has overtaken South Africa as the continent’s largest economy, one SAPeople Facebook follower, Allen Jay Burton said: “NO WAY?!”…and then added “well at least the wine and food is better in South Africa.”
And so apparently is our individual consumer buying power. South Africa has a per capita GDP of $6,089 (according to Stats SA) compared to Nigeria’s per capita GDP of $3,020. Go South Africa!