Middle class in Nigeria, others to balloon, says Standard Bank

AFRICA – Middle class households in eleven leading sub-Saharan African economies, excluding South Africa, are set to balloon to about 40 million by 2030, as the benefits of economic growth are more inclusively distributed, according to Standard Bank Group Limited.

AFRICA – Middle class households in eleven leading sub-Saharan African economies, excluding South Africa, are set to balloon to about 40 million by 2030, as the benefits of economic growth are more inclusively distributed, according to Standard Bank Group Limited.

About 15 million of the 110 million households in Nigeria, Angola, Ethiopia, Ghana, Kenya, Mozambique, South Sudan, Sudan, Tanzania, Uganda and Zambia are lower middle class and middle-class, consuming from $15 to $115 a day, the continent’s largest lender said yesterday.

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About 86 per cent of households are low-income, consuming less than $15 a day; it was quoted to have said by Bloomberg.

The emergence of a middle class was found to be most profound in Nigeria, which has Africa’s largest economy. About 4.1 million households, or 11 percent of the West African nation’s population consume $23 to $115 a day. That’s six times more than in 2000.

“Between 2000 and 2014, we’ve seen a tripling of middle class households across these 11 countries,” the political economist at Standard Bank, Simon Freemantle said in Johannesburg.

“It confirms the idea that Africa has structurally changed, that there has been real improvement in the last 10 years. Not just cyclical, it’s been a real structural change,” he added.

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East Africa lagged behind other regions in the study, with more than 90 per cent of households in Ethiopia, Tanzania, Uganda and Kenya defined as low-income.

“Africa remains predominantly low-income,” Freemantle said.

“A big part of these households are exceptionally vulnerable, exceptionally marginalised and very far from being able to allocate any kind of spending to what would be defined as non-staple. These are people clinging to survival, and that’s obviously a big socio-economic challenge that needs to be faced very pragmatically.”

Nigeria has the potential to be one of the world’s top 20 economies by 2030 with a consumer base exceeding the current population of France and Germany, McKinsey & Co, a global management consulting firm had said.

Nigeria, Africa’s biggest economy may expand about 7.1 per cent a year through 2030, boosting gross domestic product (GDP) to $1.6 trillion, possibly pushing it above Netherlands, Thailand and Malaysia, the New York-based company had said in a report.

About 60 per cent of Nigeria’s estimated population of 273 million by then may live in households earning more than $7,500 a year, fueling a consumer boom, McKinsey further said.

“Nigeria has a very positive outlook,” co-author of the report, Acha Leke, said in an interview on Bloomberg TV Africa.

August 20, 2014; http://www.thisdaylive.com/articles/middle-class-in-nigeria-others-to-balloon-says-standard-bank/186808/

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