If Nigeria and South Africa keep growing at
their current paces, Nigeria could replace
South Africa in the Group of 20 (G20)
countries within nine years, according to
Stanlib chief economist Kevin Lings. In a
recent note he says: “It is entirely feasible
that, by then, Nigeria’s economy will have
overtaken South Africa’s, making it eligible
for G20 membership, possibly at the expense
of South Africa. “
The G20 is a group of 19 advanced and
developing countries plus the EU, set up in
1999. South Africa is the only African country
to be represented.
Lings points out that 20 years ago, the
domestic economy was 7.5 times the size of
the Nigerian economy, in dollar terms. But by
the end of 2012 it was only 1.4 times the
size of Nigeria’s.
“This narrowing of the gap is mainly because
Nigeria’s economic growth rate has
accelerated meaningfully in recent years,
though off an extremely low base, while
South Africa’s growth rate has moderated.”
According to Nigeria’s central bank, growth in
gross domestic product (GDP) averaged 6.8
percent between 2005 and 2013. From 2005
until the global recession of 2008/09, South
Africa’s growth rate averaged a little over 5
percent. Since then it has not topped 3.5
percent.
Nigeria’s central bank said the fastest
growing segments were wholesale and retail
trade, and telecommunications. Nigeria’s 170
million people make it the most populous
country in Africa and the seventh-biggest in
the world.
This creates a massive market, attracting
investment from across its borders, including
from South Africa, which is becoming
increasingly aware of the opportunities in
servicing this population.
In contrast, South Africa’s population is
estimated at 51.1 million (5.7 percent of the
population in sub-Saharan Africa), making it
the fifth most populated country in Africa,
Lings says.
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