Dr. Deanne De Vries, author, speaker and Africa advocate
We’ve all seen headlines describing Africa as the hopeless, hopeful, rising, dark, fastest growing, emerging continent.
Africa has always been a continent full of diversity and opportunity for those who had an appetite for it, built the bandwidth and invested capital in social, cultural and economic infrastructure.
For the past 30 years, I’ve had a front row seat participating in the growth of my own company and those I’ve worked for, as well as advising entrepreneurs, and local and international companies on their growth across Africa and its 55 countries.
To me, Africa is AfriCAN – the “can do” continent.
The secret to their successes? First and foremost, they are on the ground, in the communities, partnering with local companies.
Expanding not just across the continent but across the globe, Africa is the birthplace for companies such as about Dangote Industries, Tanzanian-based MeTL group, telecoms companies like Econet Global and MTN, as well as banks, retailers, insurance companies and many others who continue to find plenty of opportunities across Africa.
The secret to their successes? First and foremost, they are on the ground, in the communities, partnering with local companies. They also invest in infrastructure to grow not just their own operations, but that serve the larger communities as a whole: power generation, in-house training academies, roads and bridges. Furthermore, they localize their products and services to the African market.
The secret to their successes? First and foremost, they are on the ground, in the communities, partnering with local companies. They also invest in infrastructure to grow not just their own operations, but that serve the larger communities as a whole: power generation, in-house training academies, roads and bridges.
Furthermore, they localize their products and services to the African market.
When Africa falls short of matching Asia’s growth pattern, fingers wag and people declare Africa lagging behind and failing. However, times have changed. So too should our perceptions and indicators of industrialization and economic growth.
A potentially more appropriate indicator is looking at “industries without smokestacks” such as horticulture and high-value agribusiness, tourism, business services, and other tradable
services, such as transport and logistics.
Between 1998 and 2015, services exports grew more than six times faster than merchandise exports across Africa. Overseas Development Institute in the UK found that the services sector in Africa contributed more than 50% to labor productivity growth in 15 of the 25 countries they researched. In South Africa, research suggests that jobs in the industries without smokestacks will account for nearly 80% of all new jobs through 2028.
Africa’s country borders do not mirror market boundaries. Rather, it is the cities and urban corridors that offer a concentrated and rapidly increasing growth for businesses as Africa’s leading cities account for 80% of a country’s consumers with the disposable income to buy the cars, TVs, appliances, and services.
According to the UN, by 2030 Africa will be home to 10 mega cities (+10 million people), 17 cities with more than 5 million inhabitants and nearly 90 cities with at least a million inhabitants. That is a lot of consumers and a lot of opportunity to meet their desire for services, retail goods, healthcare, education, and hospitality. With such concentrated numbers of people, companies can benefit from lower fixed costs and easier product distribution.
Africa’s rapid acceptance of mobile telephony was helped by their lack of legacy infrastructure. They leapfrogged over the telephone poles and copper wires and went straight to digital.
Africans are also able to move from kerosene to solar-based electricity, leapfrogging grid-based electricity.
It’s wonderful that people can study, stream a video, do their banking and make an appointment for their baby’s next check up via digital technology, however too many still live without running water or electricity.
Leapfrogging cannot replace lack of infrastructure or good governance. Which brings us to our final reason why now is the time to invest in Africa.
The World Bank estimates that Sub-Saharan Africa’s GDP would grow by 1.7% a year if it were to close the infrastructure gap.
Infrastructure
The World Bank estimates that Sub-Saharan Africa’s GDP would grow by 1.7% a year if it were to close the infrastructure gap. Successful companies in Africa know that by helping to close the infrastructure gap everyone benefits. This is more than a contract to build a road or hospital. It is imitating Dangote Cement that builds power generation for their cement factories that are also accessible to the local population. Or partnering like MTN and Airtel who share cell towers in Uganda not only because it lowers their costs; it also improves services and access to the internet for everyone, which in turn improves the economy and, of course, increases MTN and Airtel’s revenue.
For 30+ years, Dr. Deanne De Vries, international best selling author of “Africa: Open for Business”, has been changing people’s and companies’ mindset about business in Africa as she opens the doors for entrepreneurs and companies to establish themselves in Africa by challenging outdated images and introducing them to AfriCAN: the can-do Continent. This is helped along by her fluency in six languages.
