Abdelmonem Fawzi
Instability sweeps through African economies, poverty is widespread, and many African countries are now at war with either terrorist insurgencies or one another, which puts further strains on their economies.
Despite these challenges, Africa’s 54 countries include some of the fastest-growing economies in the world.
Africa’s Gross Domestic Product (GDP) is expected to reach $29 trillion by 2050, powered by its agriculture, trade, and natural resources sectors.
The region has an eager and expanding workforce, with 20 million new jobseekers a year in sub-Saharan Africa alone.
However, in terms of total GDP, Egypt wins out as the richest country in Africa for 2021.
Egypt has the highest total GDP of any African country, but with 104 million people, it ranks only eighth in terms of GDP per capita. Egypt is Africa’s third-most populous country.
Also, Nigeria is the most populous country in Africa, with 211 million residents — nearly twice the population of Egypt — contributing to its GDP.
Nigeria is a lower-middle-income, mixed economy focused on petroleum and (to a lesser extent) agriculture.
It is also an emerging market with growing financial, service, communications, and technology sectors.
Egypt is a mixed economy with an advantage in tourism, agriculture, and fossil fuels. It also has an emerging information and communications technology sector. ٤
Africans are starting to catch up with the rest of the world technologically as well. Every day, over 90,000 residents of sub-Saharan Africa log onto the internet for the first time.
Africa may be the least developed of the major continents — even the richest African countries lag far behind the wealthiest countries in the world – but its potential is both substantial and undeniable.
While there are several ways to compare various nations’ wealth, one of the best methods is to evaluate each country’s GDP. This is the value of all the goods and services produced by a nation in a given year.
To make country-to-country comparisons more precise, GDP is often first adjusted for Purchasing Power Parity (PPP), which modifies each country’s GDP relative to local prices, and expressed in a fictional currency called international dollars (INT).
Egypt comes top in the International Monetary Fund’s 2021 list of the 10 Richest African Countries by Overall GDP with $1.38 trillion. It is followed by Nigeria ($1.14 trillion), South Africa ($861.93 billion), Algeria ($532.57 billion), Morocco ($302.77 billion), Ethiopia ($298.57 billion) Kenya ($269.29 billion), Angola ($217.97 billion), Ghana ($193.63 billion) and Sudan ($189.87 billion).
Although GDP is an extremely valuable metric, it is also quite broad.
For example, it disregards the number of citizens contributing to a country’s GDP, which means a country with a vast, but less effective workforce, can post a higher GDP than a country with a smaller, but efficient workforce.
To get a more granular look at this and other factors, economists often turn to GDP per capita, which divides gross domestic product by the number of people in the country.
The Richest African Countries by GDP per Capita (INT$ at PPP — World Bank 2021) are Seychelles ($30,898), Mauritius ($23,841), Equatorial Guinea ($18,625), Botswana ($18,507), Libya ($15,816), Gabon ($15,582), South Africa ($13,010), Egypt ($12,261), Algeria ($11,997), and Tunisia ($11,096).
Switching the measurement to GDP per capita has a significant impact on the list of Africa’s richest countries.
Seychelles is the richest country when using this metric. The Seychelles economy is primarily driven by fishing, tourism, boat building, processing coconuts and vanilla, and agriculture, especially cinnamon, sweet potatoes, tuna, and bananas.
Its public sector contributes the most employment, and gross revenue, employing two-thirds of the total labor force.
Nigeria does not even make the new list — in fact, it is in 22nd place.
Furthermore, the total private wealth currently held on the African continent is $2.1 trillion. It is expected to rise by 38% over the next 10 years, according to the latest 2022 Africa Wealth Report, published by citizenship planning firm, Henley & Partners, in partnership with global wealth intelligence firm, New World Wealth.
The report reveals that Africa’s ‘Big 5’ private wealth markets, South Africa, Egypt, Nigeria, Morocco, and Kenya — together account for over 50% of the continent’s total wealth.
There are currently 136,000 high-net-worth individuals (HNWIs) with a private wealth of $1 million or more living in Africa, along with 305 centi-millionaires worth $100 million or more, and 21 US dollar billionaires.
Despite a tough past decade, South Africa is still home to over twice as many HNWIs as any other African country, while Egypt now has the most billionaires.
Mauritius has the highest wealth per capita (average wealth per person) in Africa, at $34,500, followed by South Africa at $10,970 and Namibia at $9,320.
Stuart Wakeling, head of Henley & Partners Nigeria, says Covid-19, climate change and conflicts, including the war in Europe, are currently key drivers of investment and wealth migration.
“In addition to the traditional benefits of enhanced global mobility, for the African investor”, he said, “residence, and citizenship by investment programmes offer a proven diversification strategy in terms of wealth and legacy management and domicile optionality, and many programmes also include the option to invest in real estate, which itself has multiple yields”.
Group Head of Private Clients at the firm, Dominic Volek, concludes that the appeal of investment migration for affluent families is truly universal.
“This is due to its many benefits, ranging from domicile diversification to global mobility enhancement, to accessing world-class education and healthcare, to having a plan B in times of turmoil,” he said.
“No matter where you were born, or where you currently reside, wealthy investors can future-proof themselves and their families for whatever might lie ahead through investment migration,” Volek added.
