Nigeria’s unprecendented economic growth rate, especially with data recorded in 2012 and 2013, has seen its economy surpass the combined average for BRIC (Brazil, Russia, India, and China) countries.
Economic growth during the period – largely attributed to policy reforms that encouraged foreign direct investment (FDI) and accelerated economic activities – saw Africa’s largest economy grow faster than the combined average of BRICs.
For the past two years, the West African country’s economy grew at an average of 6.45 percent, 2.39 percent higher than combined percentage of 4.06 for the BRIC countries.
The acronym ‘BRIC’ was coined by Jim O’Neill in a 2001 paper entitled “Building Better Global Economic BRICs”, but came into widespread use as a symbol of the apparent shift in global economic power away from the developed economies towards the developing world.
According to FBN Capital analysts, the glow surrounding the BRIC has faded and it has led to reductions in the International Monetary Fund (IMF)’s forecasts for 2014 growth, with Brazil dropping from 2.3 percent to 1.8 percent and Russia from 2.0 percent to 1.3 percent.
However, the fading glow did not affect China, as the Asian powerhouse grew faster than the BRIC average, according to data from the IMF’s latest World Economic Outlook (WEO).
“The commentary argues that the sell-off in emerging markets in late January was most painful in economies with large current-account deficits. We have made a similar argument (in Nigeria’s favour) about external balance sheets, and note from the statistical appendices that Nigeria is one of just five net external creditors in sub-Saharan Africa,” said Gregory Kronsten, who led the team of analysts from FBN Capital.
With reforms enacted in key sectors like banking, power and agriculture sectors, and with a robust investment acitivites by its $1.5 billion Sovereign Wealth Fund (SWF), Nigeria’s economic growth has the potential to continue developing and enhance living standards for its over 170 million population – most of whom are oveften touted as living on less than $1 a day.