by Business Day Online / Patrick Atuanya
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Nigeria has become the largest African economy just like China overtook Japan as the world’s second largest economy, at a time when Frontier Markets are becoming more attractive to global investors.
The country is also increasingly positioning itself as an investment hub on the African continent as appetite for South Africa, its more developed rival to the South wanes.
South Africa’s credit-rating outlook was cut to negative from stable by Fitch Ratings, last week because of deterioration in the country’s growth prospects.
South Africa’s economy, the second largest on the continent – after Nigeria leapfrogged it post a rebasing of gross domestic product (GDP) data – is threatened with recession as a 20-week strike over pay shut the world’s biggest platinum mines.
The country’s GDP contracted an annualized 0.6 percent in the three months through March, comparing unfavorably to Nigeria whose economy expanded by 7.72 percent in the fourth quarter of 2013.
Growth in Nigeria’s $492 billion economy should accelerate to 7.1 percent in 2014, according to the IMF, while Fitch downgraded South Africa’s growth forecasts to 1.7 percent this year from a previous estimate of 2.8 percent.
Source: Business Day Online
Author: Patrick Atuanya
