Africa Economy: South Africa, Egypt, Nigeria and Kenya

The International Monetary Fund forecasts that in 2024, South Africa will briefly overtake Nigeria and Egypt as the continent’s largest economy. In 2024, South Africa’s GDP will be USD 401 billion, compared to Nigeria’s USD 395 billion and Egypt’s $358 billion. In 2025, Nigeria will return to first place – it is implementing reforms due to the decline in oil production, high inflation and the decline of naira value. The reforms include modernising the currency system, eliminating gasoline subsidies and increasing tax revenues.

To finance the transformation, Nigeria will receive a loan of USD 1.5 billion from the World Bank and a loan of USD 80 million from the African Development Bank. The reforms should accelerate economic growth and support more than 40% of the 200 million impoverished people. Over the past eight years, the country’s debt has increased almost eightfold to over $110 billion, and servicing these liabilities consumed 96% of budget revenues in 2022.

The Kenyan authorities are struggling with the weakening of the Kenyan shilling, high fuel prices on global markets and the repayment of foreign debt. At the same time, they are applying for a one billion dollar loan from China despite the growing public debt, which, according to government data for 2022–2023, reached approximately USD 68–70 billion. Kenya already owes $6 billion to Chinese creditors. As part of the Belt and Road Initiative, China financed, among others, the construction of a Kenyan railway line from the port city of Mombasa to the Rift Valley through the capital, Nairobi. It cost almost $4.7 billion.