Last updated on December 31st, 2022 at 06:34 am
Nigeria is still the economic leader in Africa with a GDP of $511 billion, throwing Egypt and South Africa to the second and third position at $436 billion and $426 billion respectively.
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According to the recent nominal projections data from the International Monetary Fund (IMF) for the end of the year as of April 2022, the oil-rich country leads Egypt with a difference of $75 billion.
Despite its huge economic prospects, the majority of Nigerians find it challenging to meet ends meet, small businesses continue to face challenges in accessing favourable loans to support their venture. The available ones come with high-interest rates.
Globally, the United States remains a country to beat with a GDP of $25.3 trillion, followed by China with $19.9 trillion of GDP.
African Largest Economy by Nominal GDP
GDP means Gross Domestic Product which is the monetary measure of the market value of all finished goods and services produced within a country during a specific period.
Economically speaking, GDP is used to estimate the size of the growth rate of a country’s economy which is majorly calculated using incomes, expenditure, or production.
The majority of jobs are provided by Micro, Small and Medium-Sized Enterprises, which have also been hit by high inflation and other challenges confronting the African continent.
Despite the challenges, below is a list of the top 10 African largest economy and their nominal GDP:
|3||South Africa||$426 billion|
Nigeria among Inflation-Hit Countries
Due to bad leadership and poor management, Nigeria is prone to negatively reacting to external economic policies of the west, no wonder the World Bank recently listed the most populous African nation among the worst-hit with the inflation rate.
Nigeria isn’t the only country affected by inflation – the US, the UK, and Germany among others experience the same – but poor implementation of economic policies has complicated Nigeria’s inflation rate.
The World Bank data which is based on 2021 figures put Nigeria’s inflation rate at 16.95%, making the country eighth on the list of top 10 countries with terrible inflation rates.
Top 10 countries worst hit by the inflation rate
The table below shows the top 10 countries worst hit by the inflation rate in 2021, according to World Bank data, the list is dominated by African countries (six)
Nigeria’s Latest Inflation Rate
In 2020, Nigeria’s inflation rate was 13.25 per cent. It jumped to 17.71% in May 2022 from 16.82% in April 2022.
The June 2022 Nigeria’s inflation rate in Nigeria at 18.60%, according to the Consumer Price Index June 2022 report by NBS
The National Bureau of Statistics (NBS) is Nigeria’s owned agency which is solely responsible for collecting, compiling, analyzing, and publishing statistical information as it relates to the socio-economic life of the Nigerian people.
Recently, statistics by the NBS have been put under the spotlight by Nigerians who said the data doesn’t correspond with the realities on the street and economic challenges faced by average Nigerians.
Rich with oil and other numerous mineral resources spread across the 36 states of the federation, Africa’s top crude producer has failed to take advantage of oil prices, and instead, the country’s leadership continues to compile debts.
What’s Nigeria Doing to Contain Inflation?
Obviously, no responsible leadership folds their arms when the inflation rate is crippling business. One such action taken by Nigeria’s apex bank lately is the hike in lending rate aimed at controlling the rising money supply and preventing capital flow reversal among other inflationary measures.
But the measures have negative implications and businesses are going to be badly hit because the cost of funds would be higher, “as banks would reprice existing loans to reflect the change in the base rate,” says the President of the Nigerian-British Chamber of Commerce, Mrs. Bisi Adeyemi, in a recent interview with The Punch
The effect of this is that it may force businesses to slow down productivity and possibly cut jobs and retrenchment.
On top of that, the official foreign exchange market is not accessible to manufacturers who need to import materials for their production from foreign countries.