Africa’s economic growth is expected to RISE
Nigeria’s emergence as Africa’s biggest economy is being described as good news for the continent, since it indicates that Africa may not be as poor as the world thinks.
It is official; Nigeria has overtaken South Africa as the biggest economy in Africa. The world now has a strong sense of how large the Nigerian economy is but what matters is the productivity. It is said that investors will probably not make a choice to invest in Nigeria over South Africa based merely on the GDP size alone.
Generally speaking, Africa’s economic growth is expected to hit 5.2% later this year (2014) lifted by rising investments in the oil, gas and mining sectors. Sierra Leone, the Democratic Republic of Congo (DRC), Cote d’Ivoire and Mali emerged as the key drivers of Africa’s growth in 2013, driven by massive natural wealth investments.
Bank economists say for the high economic growth sectors to benefit more people, governments must directly re-invest the funds generated from mineral exports into social sectors. Bank officials pointed out the need to re-invest these incomes on improving school enrolment rates and cash transfers for poor parents, as is done in countries such as Ethiopia. They also urge the use of taxes, royalties and other incomes to be spent on creating social pensions for the elderly and the poor, while still ensuring the vulnerable populations on these cash transfers continue to work normally.
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