South Africa To Temporarily Surpass Nigeria, Egypt, As Africa's Largest Economy By 2024 - Forecasts IMF

Several reports coming from the International Monetary Fund (IMF) suggest an upcoming change in Africa's economic landscape. According to these forecasts, South Africa is set to outdo Nigeria and Egypt, temporarily rising to become Africa's largest economy in 2024.

The IMF's World Economic Outlook predicts that South Africa's GDP will clock at $401 billion in 2024. It essentially outpaces Nigeria and Egypt, whose GDPs are projected to be $395 billion and $358 billion, respectively. Despite this short-lived crowning moment, South Africa is expected to fall behind Nigeria in 2025 before subsequently slipping to third place after Egypt by 2026.

Nigeria's economy has consistently been ahead of South Africa's since 2018. However, a recent slowdown in oil production combined with rampant inflation has negatively impacted Nigeria's economic standing. Nevertheless, Bola Tinubu, Nigeria's president, has instituted several policy changes aimed at reforming the finance sector and revamping foreign-exchange systems. All these changes aim at helping restore Nigeria's economic vigour, with its GDP slated to grow by 3.1% in 2024.

As for Egypt, its economy has been affected by a series of currency devaluations. Nonetheless, a $3 billion IMF aid package secured last year is expected to enforce a flexible exchange rate, fostering economic growth from 2026 and beyond.

South Africa, which operates a free-floating rand, has lost about 10% of its value against the dollar this year. Although this current economic atmosphere offers challenges, the IMF sees room for potential growth. An improvement in power supply and logistics, alongside robust policy reforms, could enhance growth by 2.5% - 3%.