BY GUEST BLOGGER: TOSIN NIYI
Stories written about Africa and doing business in Africa is full of misconception without proper understanding of the prevailing business environment. It is however funny when many Africa countries are classified as third world nations while the continent itself is classified as emerging market what a contradiction…..
The Africa that I know has abundance of opportunities and untapped potentials with very few foreign companies taking advantage of these potentials. Over 70% of the continent’s population are under 40 years of age with vibrancy, energy, talents and drive to excel which is what every firm will love to have in its workforce. This is the continent that has 7 out of the 10 fastest growing economy in the world. Governments in Africa are working really hard to make the continent the destination for investors despite negative reports about the continent.
Investing in Africa will not only cushion the effects of the Euro crisis on company’s balance sheet but it is also massive consumer market.
a) It is the only continent that is rich in natural resources with countries like Nigeria, Angola, Libya and recently Ghana in oil, Platinum and diamond in South Africa, cocoa in Ivory coast and many more.
b) IMF has predicted that the continent will grow more significantly in the coming years. With many African countries working to enhance the business environment and making it easier to do business.
c) Africa is the fastest growing telephony market with over 600 million subscribers still growing and over 50% of the population not connected and waiting.
d) Africa is the only continent apart from some part of Asia that grew during the global economic recession in 2009 and even get better in 2012.
e) When the spending power of Europeans and Americans are falling, the spending power of Africans is increasing with increase in the middle class of over 250 million people.
Lots of multinational firms took advantage of this abundant opportunities and have never looked back since then or regretted taking that investment decision.
Guinness Nigeria a subsidiary of Diageo Plc UK is the second largest market in the world is expected to outperform United Kingdom market by 2014 according to research carried out by Renaissance Capital in 2011. In addition more than 45% of the company’s global sales is from Sub -Saharan Africa. In recent announcement from Diageo Plc, Nigeria is the biggest market for Guinness foreign extra stout in the world overtaking the home country Ireland with the country having 6% of its global income.
PZ Cussons manufacture of healthcare products and consumer goods started its African subsidiary in 19th century and now Africa is its largest market. The consumer spending in Europe is falling while the consumer spending is ever-increasing with lots of places in Africa yet to be invested into by the firm.
Doing Business in Ghana: http://www.gipcghana.com/
Doing Business in Kenya: http://www.investmentkenya.com
Tosin Niyi⎢⎢ is a financial adviser and a business analyst that has a passion for politics and economic policies in countries around the world but with a special interest in emerging markets. He also blogs regularly for EcoInshore