Nigeria becomes Africa's largest economy
Category: Business News
South Africa overtaken as biggest economy in Africa after Nigeria rebases GDP calculation to more than $500bn.
Nigeria has overtaken South Africa as Africa's largest economy after a re-basing calculation almost doubled its gross domestic product to more
than $500bn, data from the statistics office showed.
GDP for 2013 in Africa's top oil producer was 80.22 trillion naira,
or $509.9bn, the Nigeria Bureau of Statistics said on Sunday, up from
the 42.3 trillion estimated before the re-basing, according to the
Reuters news agency.
Most governments overhaul GDP calculations every few years to reflect
changes in output, but Nigeria had not done so since 1990, so sectors
such as e-commerce, mobile phones and its prolific "Nollywood" film
industry - now worth 1.4 percent of GDP, Kale said - had to be factored
in to give a better picture.
Nigeria, Africa's most populous country with 170 million people, has
been growing as an investment destination owing to the size of its
consumer market and growing capital markets.
'Exercise in vanity'
Analysts said the recalculated GDP would raise Nigeria's profile, but change little on the ground.
"Is the money in your bank account more on Sunday than it was on
Saturday? If you had no job yesterday, are you going to have a job
today?" asked Bismarck Rewane, CEO of Lagos-based consultancy Financial
Derivatives.
"If the answer to those questions is 'no', then this is an exercise
in vanity," he added, though he said the new figure was more accurate.
Many Nigerians shrugged off the GDP news.
"I'm not really impressed. I don't feel it in my pocket... It's not
the masses who are rich," said Richard Babs-Jonah, 47, a small
farmer, expressing the common view that Nigeria's economy is rigged in
favour of a handful of well-connected oligarchs.
"Those controlling the economy, those with government contracts, get all the money."
Nigeria vs South Africa
Nigeria's taking the title of Africa's biggest economy will fuel a longstanding rivalry with South Africa.
South Africa currently represents Africa at the G20, as well as in
the "BRICS" group of the most powerful emerging economies, which also
includes Brazil, Russia, India and China.
Nigeria may argue that it should join those clubs too.
It will also enliven competition for investor capital at a time when
South Africa faces challenges such as striking workers and high current
account and budget deficits.
Despite its roaring growth of recent years and now a bigger GDP,
Nigeria still trails South Africa in basic infrastructure - power and
roads - necessary to lift its people out of poverty.
Source: Reuters
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