Africa’s richest man and president of Dangote Group, Aliko Dangote has rebuffed a publication based on Gross Domestic Product (GDP) at the end of 2015 by the International Monetary Fund (IMF) claiming that South Africa’s economy has regained its position in dollar terms as the value of the Nigeria’s naira move in opposite directions more than two years after losing Africa’s largest economy to Nigeria.
According to IMF, the size of South Africa’s economy was last rated around $301 billion at the rand’s current exchange rate, while Nigeria’s GDP is $296 billion.
The business tycoon while speaking at the Lagos Chamber of Commerce and Industry 2016 presidential policy dialogue session rejected the claim and reaffirmed that Nigeria remains the number one economy in Africa and has not been overtaken by South Africa.
He also said that the problem with the economy did not start with the Muhammadu Buhari administration
However, IMF analysis stated that the Nigerian economy contracted by 0.4 percent in the three months through March from a year earlier amid low oil prices and output. Also the shortage of foreign currency added to all these curbed imports including fuel. In South Africa, GDP contracted by 0.2 percent from a year earlier as farming and mining output declined.
“More than the growth outlook, in the short term the ranking of these economies is likely to be determined by exchange rate movements,” Alan Cameron, an economist at Exotix Partners LLP, told Bloomberg in an email response.
Cameron said, although Nigeria is unlikely to be unseated as Africa’s largest economy in the long run, “the momentum that took it there in the first place is now long gone.”
Nigeria was evaluated as the continent’s largest economy in April 2014 when authorities in the West African nation overhauled their GDP data for the first time in two decades.
The rand gained 1 percent to 13.2805 per dollar at 4:03 p.m. in Johannesburg on Wednesday. The naira weakened 2.7 percent to 320 per dollar.