Africa’s Gross Domestic Product (GDP)
In Africa – the IMF does not publish dollar GDP estimates for Egypt in case anyone realises that the currency may weaken …but we do. And if I add in Egypt – I discover that South Africa is just $2bn larger than Egypt in 2015 (if IMF and Rencap forecasts are correct). How the mighty have fallen. The FT news editor on Monday called SA a colossus in Africa – but now it is on the verge of falling into third place.
Give it two years and I’d expect SA to be ahead of Egypt though – the rand is cheap and the Egyptian Pound is expensive. Give it five years … then Egypt President Abdel Fattah el-Sisi’s reform effort (and the larger population) may put it ahead permanently.
Note even if Nigeria devalued by 15 per cent as we expect or even a more dramatic 30 per cent (as implied by our Real Effective Exchange Rate piece) – it would be ahead of everyone else.
Source: IMF, Rencap