Egypt has officially dethroned South Africa as Africa's second largest economy, according to a report from KPMG .

The news comes as a serious blow to South Africa, which slipped from No. 1 to No. 2 in early 2014, as Nigeria took the lead. However, Egypt's rise to second place has more to do with South Africa's economic decline than it does with strong economic growth in Egypt.

Source: KPGM
Source: KPGM

South Africa's economy has been declining since 2012, while the Central Bank of Egypt has tightly managed the country's currency, according to the report. As Egypt managed to see its nominal U.S. dollar gross domestic product expand by an average of 7.5 percent during the past four years, South Africa's currency – the rand – depreciated by more than 50 percent.

"Were it not for the rand’s slump, South Africa would not have surrendered its second place," KPMG senior economist Christie Viljoen said, according to Quartz .

It's a long way to fall in a short period and the people behind the report aren't optimistic that South Africa will be able to reclaim the No. 2 spot, let alone the No. 1 spot, anytime soon.

"Psychologically, I do think this is a blow [to South Africa]. We’ve always thought of ourselves as the powerhouse of Africa, and then we’re number two and now we’re pushed to number three," KPMG’s chief economist Lullu Krugel said.

While the rise of Egypt's economy to the second place position is great and though the country's economy continues to grow, it still has a bit to go before it can challenge Nigeria for No. 1. However, with Nigeria's GDP dropping sharply, you never know.