South Africa’s economy is estimated to be about 5% larger than previously reported after a benchmarking and rebasing exercise, its statistics agency said on Thursday, moving it further ahead of Nigeria as Sub-Saharan Africa’s biggest economy.
Statistics South Africa said last year’s nominal gross domestic product (GDP) was now estimated at 8.04 trillion rand (about $483 billion), up from 7.64 trillion rand
Statistics agencies worldwide rebase and benchmark their GDP estimates to take into account changes in the composition of the economy and other factors
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Nigeria, Sub-Saharan Africa’s second-largest economy, recorded nominal GDP of 441.5 trillion naira ($328 billion) last year
Nigeria used to have a bigger economy in dollar terms, but devaluations of its currency the naira meant South Africa overtook it
South Africa’s latest rebasing exercise changed the base year for its GDP calculations to 2022 from 2015
It also incorporated previously non-observed parts of the economy like self-generation of electricity, illicit and illegal mining and manufacturing activity and e-hailing services
The 10 sectors it tracks were all shown to have higher output, with mining, finance and trade registering the largest increases
Johann Els, chief economist at financial services firm PSG, said the revisions to the size of the economy would make South Africa’s debt numbers look better, in particular its closely-watched debt-to-GDP ratio, which the government is trying to bring down