Africa Rising: Business Opportunities in Africa

Africa is a rising star, with key business opportunities in services, infrastructure and transport, communications, mining and energy

Business opportunities in Africa are rising

Despite negative media perceptions business opportunities in Africa abound

Investment climate supports creation of business opportunities in Africa

The international media are again focusing on negative news stories in Africa. There is a growing risk that international perceptions of Africa and its business prospects will be clouded by this adverse media trend. We need to refocus on the positives, and to remind ourselves that Africa continues to be the continent of hope and burgeoning business opportunity.

The investment climate in Africa is changing and investors are responding. Let’s look at some of the key facts:

Business opportunities in Africa are supported by government reforms

Promoting business, trade and inward investment is a key government priority

  • Promoting business, trade and inward investment is a key priority of all African Governments.
  • Many African states now have sizeable and growing business sectors, with expanding cadres of innovative and experienced entrepreneurs.
  • Of the world’s 20 fastest growing economies, 11 are in Africa.
  • Africa in 2016 will have the world’s most rapid continental growth.
  • Global Greenfield FDI grew one per cent on 2014. In contrast Africa experienced a 65% increase in capital investment compared to 2013.
  • FDI in sub-Saharan Africa in 2014 totalled $42 billion, despite the impact of Ebola, regional conflict and falling commodity prices. Western Europe provided over half of this, with the USA and China ranking second and third.
  • Six of the 10 countries with the highest urbanisation rates in the world are in sub-Saharan Africa. The related housing and infrastructure sector is huge.
  • Africa’s potential additional agricultural land area totals some 300 million hectares (60% of the global total).
  • With 618 million mobile phones in use, Africa offers the fastest growth in this all important telecommunications sub-sector.
  • Africa’s total population of around 1.2 billion is growing annually at 2.6%. While this presents challenges in terms of education, housing and job creation, the growth is accompanied by an expanding middle class, which in turn is generating a bigger and more sophisticated consumer market.

The list goes on…..

Current key sectors for FDI and business opportunities include:

  • Services, with finance accounting for over half of the accumulated FDI, followed by transport and communications
  • Mining and energy
  • Infrastructure, including retailing and tourist-related construction

The prospects and opportunities in these sectors are highly positive. The World Bank estimates that an extra $75 billion of investment annually is needed in infrastructure alone. But beyond these sectors there is significant and largely untapped potential in the critical agricultural sector. The challenges here are great, but given that Africa has the majority of the world’s remaining undeveloped agricultural land, with the right planning, partnership and management, the prospects are almost unlimited.

Africa is truly rising!

For information on specific tender opportunities in Africa go here

Former British diplomat with 36 years’ experience of bilateral relations, commercial promotion and policy advising in Latin America, Europe, Africa and Australasia. Head of British High Commission, Papua New Guinea and Head of the British Embassy in Liberia. David is an experienced networker with a strong track record of promoting UK business in less developed markets.

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