Nigeria staggers toward title of Africa's biggest economy

2013-03-05 09:07

Lagos – The ever-expanding moonscape that stretches out behind a wall holding back the Atlantic Ocean here will one day host a project designed to help anchor Nigeria as Africa’s biggest economy.

But if the ambitious plan to construct a new city on land reclaimed from the sea represents Nigeria’s future, it is one that will be outsourced. Nearly every aspect of it will be privately run, from electricity supply to security.

Economists expect Nigeria, already the continent’s most populous nation and largest oil producer, to overtake South Africa in terms of gross domestic product (GDP) over the next several years, technically making it Africa’s biggest economy.

But the impressive-sounding title tells an incomplete story, and the Eko Atlantic new city project illustrates the contradictions in a country crippled by corruption and unable to provide basic services, but with vast potential that could indeed one day be realised.

“The more important thing is, fundamentally, you have a population of 165 million while South Africa’s is around 52 million”, Bismarck Rewane, a respected economist and head of Lagos-based Financial Derivatives told AFP.

“So even if you are the same GDP, your GDP has to be four times more – 400% more than that of South Africa for you to have (roughly) the same income per capita.”

A recalculation of Nigerian GDP is the main reason it is projected to overtake South Africa. Nigeria’s economic output data is currently calculated using 1990 as the base year.

In order to come up with more accurate data, the new figures will use 2008, greatly boosting overall Nigerian GDP, which the World Bank put at $244 billion for 2011 compared with South Africa’s $408 billion.

The rebasing is expected to be complete in October, and economists are predicting a GDP boost of about 40%, which would put Nigeria within striking distance of South Africa.

Since Nigeria’s economy has been growing faster than South Africa’s – at an estimated rate of 6.6% for 2012 compared with 2.5% – the West African nation would then move ahead of its southern rival in subsequent years.

Nigeria’s economy has been supported in particular by high oil prices and the rapid growth of the mobile phone industry.

Agriculture accounts for some 40% of GDP and the country is trying to boost production in that sector.

Estimates for when Nigeria will at least equal South Africa have ranged from as early as 2014 to around five years from now.

Join the conversation!

24.com encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions.

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Comments have been closed for this article.

Inside News24

 
/News

Book flights

Compare, Book, Fly

Traffic Alerts
There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.




Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.