By Ugo Aliogo
McKinsey, one of the leading global professional services in a new report obtained yesterday has listed Nigeria among the ‘volatile growers’ economies.
The firm stated this in a report titled: “Outperformers: High Growth Emerging Economies and the Companies that Propel Them.”
Other countries listed under this category were Algeria, Angola, Argentina, Brazil, Greece, Guatemala, Honduras, Iran, Jordan, Kenya, Mexico and Paraguay.
The report studied 71 emerging economies and 18 achieved rapid and sustained growth.
Out of the 18, it listed seven ‘long-term outperformers’ to include China, Hong Kong, Indonesia, Malaysia, Singapore, South Korea and Thailand.
On the other hand, 11 economies that were categorised as ‘recent outperformers’ were Azerbaijan, Belarus, Cambodia, Ethiopia, India, Kazakhstan, Laos, Myanmar, Turkmenistan, Uzbekistan and Vietnam.
Nigeria’s Gross Domestic Product (GDP) figures in the second quarter 2018, recorded a growth rate of 1.50 per cent (year-on-year).
“sub-Saharan Africa is the region with the second-lowest average per capita GDP, at about $1,750, but several countries have made great strides in recent years. Labour productivity growth at 2.5 per cent annually between 2010 and 2015—the highest rate outside Asia—and government effectiveness registered significant improvement in countries such as Rwanda and Côte d’Ivoire.
“For now, only one of the 15 countries— Ethiopia—ranks among the recent outperformers. In general, connectedness to other regions is poor and exports from countries in sub-Saharan Africa lack diversity. For example, more than 90 per cent of goods exported from Nigeria and Angola are oil-related. Improving infrastructure and continuing to build out government effectiveness to attract foreign investment remain important opportunities for the region.
“Sub-Saharan Africa can focus on more sophisticated exports and better governance This is the second poorest of our regions, with GDP per capita of about $1,750, or only about one-seventh that of East and Southeast Asia and of Central and Eastern Europe. Of the 15 countries we analysed in the region, only one is an outperformer, Ethiopia, which has grown at more than five percent a year over the past 20 years.
“Ghana, Mozambique, and Rwanda, which have undergone recent growth spurts, have outpaced the long-term outperformers in the past 10 years. Tanzania and Uganda have been more consistent growers among middling economies, while Angola and Nigeria have had a more volatile past. Six underperforming economies—Cameroon, Côte d’Ivoire, Kenya, South Africa, Zambia, and Zimbabwe—have declined relative to the United States in the past decades, although Côte d’Ivoire’s economic performance has improved,” it exlained.
On average, the report noted that more than half of the population in the region works in agriculture, with non-agriculture employment growing only 2.5 per cent over the past five years. Low per capita GDP is linked with high poverty rates—on average, over 31 percent of the population in these countries lives in a household with annual income of less than $5,000.
It noted that less than 17 percent of the population in the continent is above the middle-class threshold, and the figure is growing more slowly than in other regions.
“There are also reasons to be optimistic about the future of sub-Saharan Africa. Per capita GDP growth was slightly abovethree per cent per year between 20