In October 2019, the International Monetary Fund (IMF), released a list of the top-performing African countries. Africa’s economy is expected to reach a GDP of $29 trillion by the year 2050. According to data shared by the IMF, below are the richest countries in Africa based on GDP.
Nigeria – $446.543 Billion
With a population of over 200 million citizens, Nigeria plays a significant role in Africa’s economy. Nigeria, has for the longest time, been at the top when it comes to GDP output. The country has many resources such as petroleum, natural gas, coal, iron, lead, zinc, limestone, niobium among others. Additionally, the country has vast agricultural land. This makes Nigeria one of the richest countries in Africa.
To date, Nigeria remains the largest exporter of crude oil in Africa. Data from the Organization of Petroleum Exporting Countries (OPEC) shows that the country records about 1.6 million barrels a day. Petroleum export is responsible for 10 percent of the country’s total GDP. In addition, in the export sector, petroleum exports exceed 80 percent of the revenue in the export sector. When it comes to agriculture, they produce cocoa and rubber. The sector employs about one-third of the population and is accountable for more than 20 percent of the GDP. Additionally, Nigeria’s tech sector is also experiencing rapid growth.
From 2000 – 2014, Nigeria’s GDP has been on a steady growth by an average of 7 percent. This is according to the World Bank. Nonetheless, various economic impacts observed around the world with reference to the production of oil, have slowed it down by 2 percent. Additionally, the political instability caused by Boko Haram, youth unemployment, among other socioeconomic factors, has continued to hinder oil production.
The combination of these factors along with the effects of Covid-19 and the tensions between Russia, the United States of America, and Saudi Arabia, will work against Nigeria achieving its growth target.
South Africa – $358.839 Billion
Although South Africa has been experiencing major setbacks over the last few years, they still manage to beat other countries and take the number two spot in the list of the richest countries in Africa. In 2019, South Africa experienced a recession after it suffered back-to-back negative GDP growth in two consecutive quarters. There are various factors that contributed to this. However, the most notable one was the power outages from old operations caused by Eskom. Eskom is South Africa’s main power generating company.
South Africa is a powerhouse when it comes to exporting raw materials. Such as gold, platinum, iron ore, and group metals. Still, South Africa has made giant strides thus greatly expanding its economy. The country is now big in manufacturing and financial services. This has helped it gain a spot among the richest African countries. However, the country’s GDP only grew by 0.2 percent following the recession faced in 2019.
Due to the uncertainties brought about by Covid-19, economies around the world continue to face various challenges. And even the richest countries in Africa like South Africa have not been spared. Besides, other economic drivers like mining, tourism and travel, and other industries, are still bracing for unavoidable hits. The continued slowdown in the economies will continue to pose various challenges that will be experienced across the board.
Egypt – $302.256 Billion
For years on end, Egypt was known as one of the richest countries in Africa. However, the 2011 Arab Spring revolution slowed things down. The majority of the sectors were not spared. The foreign exchanges were, however, hit badly. By the end of 2010, the foreign exchanges dropped from $36 billion to $16.3 billion in January 2012.
Nevertheless, the North African state is still among the third richest country in Africa. Egypt’s GDP grew by 0.3 percent in 2019 to 5.6 percent from 5.3 percent in 2018. This growth was because of a program between the IMF and the Egyptian government. The program was geared towards reforming and strengthening the country’s economy. Moreover, Egypt was also able to bring down the unemployment rate from 9.9 percent the previous year to 7.5 percent. This was a significant step that helped the country maintain its footing as one of the richest African countries based on GDP.
Tourism, gas extractives, wholesale and retail trade, construction, and real estate are Egypt’s main economic drivers. Similar to South Africa, the North African state has diversified its economy. This means they are not just reliant on revenue from the export of raw materials. Approximately 50 percent of Egypt’s GDP comes from service-based employment.
The coming years are expected to be tougher as the coronavirus pandemic continues to have various impacts on different nations. And Egypt will not be an exception. For a nation where 32.5 percent of citizens live below the poverty line, the global slowdown due to the pandemic will cause more harm than good.
Algeria – $172.781 Billion
Despite the fact that Algeria produces a lot of oil, the country’s economic growth has in recent times take a slow dip. The North African country is largely dependent on hydrocarbons – oil and gas. In fact, Algeria derives 70 percent of its GDP from this.
In 2019, there were scandals that rocked the hydrocarbon industry. Senior executives were implicated on corruption-related charges. This threatened to destabilise the industry. Besides the hydrocarbon industry, agriculture, construction and public works, industrial works, and commercial services are other sectors that are critical to the Algerian GDP.
While there are opportunities in the oil and natural gas industry, there is no denying that there are also significant challenges. For Algeria, the challenges are even more pronounced because its economy is highly dependent on oil and natural gas. Over the last few years, oil prices have been unstable across the world. This is definitely a reason for one of the richest African countries by GDP to be on the qui vive.
Morocco – $199.04 Billion
Agriculture accounts for 15 percent of Morocco’s GDP, while 30 percent is derived from the industry sector and the rest from services. Morocco also depends on the Moroccan automotive industry. The automotive industry had started gearing up following Peugeot’s plan to double their production capacity. However, that is currently a far-fetched dream.
The textile and telecom sectors also contribute a lot to the Moroccan economy. Additionally, the country also exports phosphates, citrus fruits, vegetables, fish, electrical equipment, inorganic chemicals, and transistors.
In the last year, however, the northwestern country has experienced stunted growth in its GDP. Although the World Bank had predicted a possible growth of 2.9 percent, the country only managed to achieve 2.7 percent. And while the World Bank has set a target of 3.3 percent for the year 2020-2021, it is highly unlikely that Morocco will achieve the said target. This is due to the ongoing Covid-19 pandemic that has led to decreased economic activities across the world.
Kenya – $98.607 Billion
2019 saw Kenya make a huge step in being one of the richest countries in Africa based on GDP. The country posted a 5.7 percent growth. Kenya’s economic growth has emerged as one of the fastest-growing in Sub-Saharan Africa. The prevailing favorable microeconomic environment was the biggest driver of this economic growth as observed in 2018-2019.
Positive investor confidence and a buoyant service sector that is on the right path were responsible for this growth in 2019. Like many African countries, the East African nation is largely dependent on the Agricultural sector. Kenya derives about 35 percent of its GDP from the agricultural sector. The main products include tea, maize, and coffee. In addition, the technology and financial service sectors also experienced fast growth.
Although the industrial sector is on a steady growth, it is responsible for about 45 – 50 percent of Kenya’s GDP. Factors that have contributed to the significant growth include a stable political environment (famously known as the ‘handshake’), which helped boost international investor confidence as well as the government’s Big Four Agenda.
Angola – $91.527 Billion
Globally, Angola is considered to have one of the fastest-growing economies, despite the recent challenges in the global oil markets. This has enabled the country to have a spot among the richest African countries. Angola’s economy is heavily dependent on oil. Oil contributes to one-third of the country’s GDP. Additionally, Angola derives about 90 percent of its revenue in the export sector from the sale of crude oil.
In a bid to try and steady the economy, Angola has been working on both political and structural reforms. Moreover, they are also working with the World Bank and IMF. The two players have promised the southern African nation $500 million and $3.7 billion respectively to help boost the economy. Angola has made great steps towards achieving stability and economic balance since the end of the civil in 2002. If they continue to work on their policies steadily and effectively as they have been doing, Angola can achieve implausible growth.
With more than 54 nations, Africa is a powerhouse when it comes to natural resources and innovation. Although the African continent is dogged by various political and social issues, it clearly has a ton of potential if it stays on the right track.