Spotlight on Africa: Nigeria’s Economy, Now the Largest
Recession was bad enough for South Africa’s economy, and now, the economy of Nigeria, has displaced theirs, moving South Africa’s economy to the position of the second-largest economy in the continent.
According to Bloomberg, Nigeria’s economic growth beat forecasts in the fourth quarter, boosting its economy into growth as oil input increased and the Central Bank of Nigeria stepped in to increase credit growth. As it has been commonplace, Nigeria’s economic growth was anchored on its oil exports with production levels remaining very stable all through 2019.
GDP in the West African country stood at $450 billion, and the economy grew by 2.27% in 2019, slightly highly than the previous year, according to Data from Bloomberg. The government’s Economic Recovery Growth Plan, launched during the aftermath of the recession, was targeted at aggressive growth from 2017 to 2020 all in a bid to rebuild the economic deficit.
The exchange rate used for the West African Nation has been the determinant factor on which economy is the largest. Going by this determinant, the official naira rate of 306 per dollar and the weaker market exchange rate of about 360 (which is what most investors use) still rank Nigeria as the highest.
Projections by Bloomberg, show that the economy will continue to grow faster while the International Monetary Fund (IMF) forecasts a 2% growth from 2.5% last month, owing to the reduction in oil price. On the other hand, South Africa’s GDP is forecast to grow by only 0.8%.
Growth in Sub-Saharan Africa is anticipated to peak at less than 3% in 2020, World Bank projects.