GDP forecasts for four rapid-growth markets in Africa

However, Lalor added that a key challenge for the South African government will be to make the shift to a constant focus on implementing the National Development Plan, as stressed by South Africa’s Minister of Finance Pravin Gordhan during his medium-term budget policy statement.

“The extent to which government is able to make this shift successfully will determine which of the diverging RGM growth paths South Africa follows,” Lalor emphasised.


According to the RGMF, Ghana’s “spectacular” growth seen in the last few years will move to a “solid” growth as the big boost from oil production fades. The report showed that GDP growth slowed to 6.7% in the first quarter of 2013 from 7.9% in 2012 and 15% in 2011.

“Services are still growing strongly and agriculture is picking up, but the rise in oil output is levelling out and world gold prices are lower,” continued the report. “We forecast solid GDP growth of about 6.5% in 2013 and then 5.5% to 6% a year in 2014–17.”


While growth is still forecast to slow in Nigeria, the non-oil sector remains the main driver of growth, according to the RGMF report.

“While services, agriculture, and wholesale and retail trade are engines of growth, the oil sector has stalled, posting a fall of about 1%. We still forecast GDP growth of some 6.5% in 2013. However, we expect it to slow to 5% to 6% a year in 2014–17 as the government struggles to implement policy reforms ahead of elections in 2015 and the oil sector continues to weigh on activity.”

In 2012, inflation was 12.2% and this has since eased to just over 8% which, according to EY’s research, enabled the Central Bank of Nigeria (CBN) to cut interest rates in May to try to support activity and rates have remained unchanged since.

“The CBN remains concerned about the impact of spending by the states on the budget deficit. High public expenditure is expected to lift the budget deficit to about 4% of GDP in 2013.”


Despite political turmoil in Egypt, the RGMF says the country’s economy seems to be rather resilient as “business sees the prospect of improved political and economic stability”.

“However, since the uprising in early 2011, reserves have fallen by more than US$20bn. Along with delayed payments to oil companies, Egypt may also have to pay back some $2bn to Qatar, with whom relations have deteriorated since the military intervention. Against the backdrop of slow growth, weak policy implementation and high government spending, the budget deficit continues to widen,” added the report. “This crowds out funds for private sector investment.”

The EY research states that the emergency $3.2bn economic stimulus plan, which focuses on investment projects, should support GDP growth of 2.4% in 2013–2014, up 0.2% in 2012.