The recent movements in the dollar-naira exchange rate, following the removal of the currency peg, has stimulated ongoing debate in the media that South Africa has regained its position as the largest economy in Africa. The prevailing notion is that the depreciation of the naira and simultaneous appreciation of the rand against the US dollar implies that South Africa’s GDP has surpassed that of Nigeria. However, this argument needs some re-examination, given that the value of the GDP (in current US$) is sensitive to the choice of exchange rate and GDP figures used for its computation. This piece situates the present argument in the context of recent commodity market crisis and its implications for the two largest economies in Sub-Saharan Africa
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This paper examines the relationship between foreign aid and the real exchange rate to determine how the competitiveness of the West African Economic and Monetary Union (WAEMU) is affected by foreign aid.
Global economic growth remained fairly stable in 2016Q3 with baseline projections for global growth at 3.1 percent and 2.4 percent by International Monetary Fund (IMF) and the World Bank respectively. Growth in developed countries was moderate but unevenly distributed: while the U.S and the UK showed improvements, growth in other economies remained tepid. Among emerging countries, India witnessed higher growth while growth in China remained constant but the Chinese Yuan continued to appreciate. Given that India is Nigerias major crude oil importer, improving economic conditions in India may translate into rising demand for Nigerias crude oil. However, the continuous appreciation of the Yuan poses significant inflationary threat in Nigeria given the high level of imports from China. Subdued global demand, weak trade, uncertainties in commodity prices and consequences of the Brexit were the key constraining factors to growth over the period. In addition, growth in Sub-Saharan African countries remained generally slow on the account of low commodity price, political turmoil, and inconsistent government policies.
Net Domestic Credit: Rising net credit to government and private sector have driven the upward trend in NDC, especially post-2008. In 2016Q1, NDC grew largely on the account of the rise in banking sec