Cape Town – The latest World Economic Outlook (WEO) by the International Monetary Fund (IMF) suggests that South Africa is now only the third-largest economy on the African continent – behind Nigeria in first place, followed by Egypt.
Were it not for the rand’s slump, South Africa would not have surrendered its second place during 2015, said Cristie Viljoen, manager in Financial Risk Manager at KPMG in South Africa.
Viljoen regards the latest WEO as reflecting “sobering” gross domestic product (GDP) statistics for SA. South Africa has been known as the continent’s second-largest economy since Nigeria rebased its GDP data in early 2014.
The WEO data further suggests that the SA economy will grow by a mere 0.6% this year.
Viljoen emphasised that SA remains Africa’s most developed economy and has a more diversified economic base than the Egyptian economy.
“However, SA’s fall from first and now second place among the continent’s giants is of great concern, especially as this development is largely attributed to weakness in the rand that, in turn, has largely been as a result of domestic issues,” said Viljoen.