The Gross Domestic Profit (GDP) of a country is a relatively comprehensive measurement of the monetary value of all the goods and services being produced within a certain period of time in a country. It seeks to give an accurate estimate of the economic output as well as the size and growth rate of a country’s economy. According to an article by Investopedia, GDP provides a scorecard or snapshot of a country’s economy. Thus, the higher the GDP of a country, the higher its economy and standard of living.
Gross Domestic Profit is calculated by considering factors such as personal consumption, business investment, government spending, and net exports. It may be adjusted to reflect inflation for better discernment since the growth of GDP is usually accompanied by inflation. Although it is typically measured annually, in some situations, there may be quarterly GDP reports.
The GDP is important for various reasons
1. By giving an accurate estimate of the size and growth rate of a country’s economy, the GDP helps numerous investors to make well informed and strategic decisions that will yield profits. It becomes easier to decide on which country’s economy to invest in by just simply comparing the GDPs of the various countries of interest.
2. GDP enables policymakers and central banks to accurately determine if the economy is expanding or declining.
3. It also creates room for economists, businesses and policymakers to take necessary actions towards boosting the economy and allows them analyze the impact of variables such as economic shocks, taxes and spending plans, and monetary and fiscal policy.
Now, let us focus on the ten African countries we believe have the highest GDPs.
Nigeria: With a GDP of about $514.05 billion in 2021, this country has no doubt earned its place as the country with the highest GDP. According to several published articles, Nigeria remains the biggest economy in Africa.
Egypt: We expect nothing less from a country with history as old as time. Located in North Africa, this country has a GDP of about $394.28 billion, making it the second-highest economy as well as the first country from North Africa region on this list.
South Africa: This country has a GDP size of $329.53 billion, making it the third-largest economy. Currently, it remains the only country in Southern Africa that made it to this list.
Algeria: According to Statista, a GDP size of about $151.56 billion makes it the fourth-largest economy in Africa. It is also the second country located in Northern Africa on this list.
Morocco: Based on data obtained from Business Insider Africa, this Northern African country had the fifth highest GDP size in Africa at $124 billion.
Kenya: Not only is Kenya the sixth-largest economy with a GDP size of about $106.04 billion, it is also the only country located in the Eastern African region to make it to this top ten list.
Ethiopia: This country has a GDP size of $93.97 billion based on reports from Statista. It is also the only country in the Horn of Africa on this list.
Ghana: Like Nigeria, this country is located in the Western Region of Africa and has a GDP size of $74.26 billion.
Ivory Coast: At $70.99, this francophone West African country has the ninth highest GDP in Africa.
Angola: Finally, with a GDP size of $66.49 billion, Angola has the tenth largest economy in Africa.