11 Questions for SFO Principal Erwan Camphuis

Having met Erwan Camphuis multiple times at different occasions across Africa left a profound impact on me. Erwan is the Founding Partner of OSEC Holding, a Mauritian Single Family Office. But he is best described as a true gentleman. Kind and humble, Erwan's vast experience and immense knowledge of Africa make him for a courageous advocate of the continent.

I am immensely thankful that he agreed to answer my 11 Questions.

Enjoy the read!

1. The first question might be the hardest. Can you please briefly summarize the history of your family business in just a few words??

After the Second World War, my father lost his father and was sent by his mother from the Netherlands to study in the UK. There, his roommate, a Nigeria-born Iranian, offered him the opportunity to trade with Western and Central Africa. In 1949, recently graduated, my father and his uncle started buying consumer goods in Europe and Asia, loading a boat so that my father could ply the coastal trade between the ports of the West and Central African coast from Nouakchott to Port Gentil. He bought his first house in Senegal in 1949 and reached Douala (Cameroon) in 1950, where he met his lifelong partner and friend. The mainstay of their business between 1950 and the end of the 1990s was the sale of consumer goods across 28 countries in West and Central Africa, where they accounted for a large share of the market. During these years, a significant proportion of the profits were reinvested in real estate, local production companies, and even European suppliers. When our fathers died, his partner's son and I formed a family office based in Mauritius. We invest in Africa (West and Central) mainly in three sectors: real estate, agriculture, and health.??

2. You have businesses in over 20 countries. What are the key strategies that have driven that growth??

?Although my partner and I have had strong international business development experience, our strategy in Africa follows a different pattern. Africa hosts 65% of the world’s remaining uncultivated arable land, yet the continent generates only 10% of global agricultural output, and net food imports to Africa cost, on average, $35 billion to $42 billion a year and are predicted to reach $110 billion by 2025. Despite accounting for 18% of the global population and 15% of the global workforce, Africa only accounts for 3% of global GDP. Africa will have the largest working population in the world in 20 years.?

Africa needs industries, jobs, simple solutions, and collaborative structures to disseminate innovation across 54 countries. Our strategy is geared towards efficiency in creating added value in Africa, creating jobs, and focusing on vocational training, which is essential for creating new opportunities in Africa. While energy commodities like coal, oil, and gas make up most African exports, manufactured products account for about 60% of the continent's imports. We aim to increase the value of African trade by creating new industries, thus trying to manufacture many of the imported commodities locally.?

3. The motto of this year’s Africa Wealth Summit is: Africa: A Continent, Not A Country. How true has this been with regards to your activity in so many African countries??

It’s also the name of Astrid Madimba and Chinny Ukata’s book, “It's a Continent,” published last year, which lets you discover Africa's diversity, beauty, and complexity. In January 2021, the African Continental Free Trade Area (AfCFTA) was launched, creating a unified market of over 1.4 billion consumers, becoming the largest free trade agreement in the world, surpassing the EU single market, USMCA, and MERCOSUR combined. Despite this launch, intra-continental trade is the lowest of any world region - constituting less than 13% of Africa’s total trade, in comparison to 66.9% in Europe, 63.8% in Asia, and 44.4% in the Americas. Africa has over one-fifth of the world's land area but less than 8% of the world's road and rail infrastructure, thus facing a major infrastructure deficit.?

On top of this infrastructure deficit, we African businessmen have been searching too long for solutions outside Africa when Africa is full of experience, natural wealth, and concrete, effective solutions to the day-to-day operational problems we encounter. In recent years, we have successfully implemented many of the solutions learned from other African countries and colleagues. Africa must continue to believe in itself and its enormous potential in the world. A demographic potential (4.2 billion inhabitants in 2100) as well as a natural resources potential (27% of global surface freshwater, the world’s primary tropical carbon sink, the Congo Basin forest, and the potential to feed 9 billion people in the world by 2050). We Africans unconditionally represent the future of the world.??

4. We all know it takes more than a clever idea. Which qualities do you believe are crucial for running a family business in the African context??

Undeniably, doing business in Africa is complicated and represents a completely different mindset than in Europe or the developed world. The first requirement is pragmatism: you have to be realistic and observant. You need to know the environment and all the details of the operations. The second quality is efficiency. For a business to work in Africa, it has to run perfectly, without a hitch, having studied and foreseen any setbacks or pitfalls that may be encountered during the development of the project. We never do business plans; we do feasibility studies.?

We have always developed private projects. We have never committed our group to public projects. Our main vocation is to create jobs and sustainability for the community. We respect the law and contribute to local development. This perspective enables us to gain the respect and support of everyone for our projects because everyone knows that they bring wealth to the economy.??

5. What emerging opportunities do you see in Africa's economic landscape that family businesses should pay attention to??

Abba Bello, managing director of the Nigerian Export-Import Bank, highlighted at the recent International Cocoa and Chocolate Forum in Abuja and Lagos that the cocoa industry — including beans, cake, and chocolate — is worth US $200 billion annually. As he stated:?"Unfortunately, the entire West African cocoa-producing region (made up of Cote d’Ivoire, Ghana, Cameroon, and Nigeria) earns only $10 billion while accounting for about 70-75% of the global output."?

We often use this example to demonstrate the reality of the processing industry in Africa. Africa has an abundance of raw materials and natural resources, but nothing is processed locally. Investment in manufacturing production or the local transformation of natural resources will undeniably be an enormous source of prosperity in Africa in the short, medium, and long term. In view of Africa's demographic growth, it is a moral and economic duty to concentrate investment in the creation of jobs and sources of local wealth in Africa. Family Offices, free to make their own choices and drawing on their own experience, can play an extraordinary role in bringing about this change.??

6. Succession is a challenge for just any family business. Your business has two families as owners. How did your families (yours and that of your Cameroonian partner) manage the transition between generations??

We face the same challenges as any other family office around the world. Succession is always a thorny issue. Fortunately, our parents understood that running a family office was no different from running a company. My partner and I make the majority of decisions, which allows us to have an effective and clear business strategy for our expansion.?

In our position in Africa today, we have above all a duty and a responsibility towards young people and the generations to come. Coming from families that have achieved economic success, we must in return be an example and a source of economic development. If this vision is at the heart of your family office strategy, then you demonstrate to your family members that this wealth does not belong to you, that you are its guardians, as in the parable of the talents in the Gospel, and that you must make the talents that have been entrusted to you bear fruit for others.??

7. As mentioned at the very beginning, you have European roots. But you see yourself as African. How do you balance your European roots with the diverse cultures and business practices in Africa??

My partner studied and worked in the UK, the US, and Europe. I studied in the UK and China and worked across all continents. Business anywhere in the world requires the same skills. Doing business in Africa does not require different skills than in other countries, but it does require absolutely all of them! You need political intelligence, local wisdom, European skills, local agility, Asian resourcefulness, American frankness, South American ingenuity, and local pragmatism.?

European and African cultures are not antagonistic; they are perfectly complementary. They allow us to calmly tackle the required challenges. What serves us most is the experience we have gained. Having the humility to learn from our mistakes or the successes of others allows us to have a creative vision and adapt to constant challenges.??

8. Do you think you’d be as successful if you had invested and did business in Europe??

Our parents invested in Europe in some of their suppliers. These investments, which are more than 40 years old, still prove to be very profitable today. However, it is undeniable that the opportunities we have encountered in Africa for more than 50 years are extraordinary, and the growth of the African continent brings us exceptional opportunities.?

We need to prepare ourselves to face this African growth. Europe represents an economic challenge, and certainly, we find interesting investment opportunities there, but our focus is on setting up these opportunities for development in Africa. We buy European SMEs whose technology or economic development is uncertain in the European industrial and economic context but which, from the perspective of African needs, take on a totally new and interesting aspect.??

9. What excites me most about the continent is that it is embracing technology and innovation. How has your African business adapted to the digital transformation we see worldwide??

Efficiency! What is efficient in Africa works! Africa accounts for 70% of the world’s mobile money market, which reached $1 trillion in 2021, with the value of Africa’s mobile money transactions reaching $701.4 billion. The main reason for this boom is not due to a lack of functioning of the traditional banking system but because of the African reality. To open a bank account, you must be able to prove a legal identity, but more than 50% of African children do not have a legal identity, so many Africans are unable to open a bank account. From this disadvantage, Africans have been able to create an asset.?

Technology is present in the lives of Africans. It provides a fantastic training tool where it is not available, and it brings cultures closer together. It sometimes makes us dream too much about the successes of developed countries. It also exploits many workers in Madagascar and Kenya who are paid very little to feed artificial intelligence by helping with pattern recognition.?

10. How does your family business approach social responsibility and contribute to the communities in which you operate??

As said previously, we feel extremely responsible to the community with the opportunities given to our families to succeed. Success came from efforts, relentless, unstinting hard work, and unwavering discipline. To ensure the future of our investments, the growth and sustainability of our markets, we must grow our businesses as much as the people around us. We have the responsibility to train and grow the people around us. The middle class is built in this way and brings new opportunities.?

It is therefore an ethical approach that is deeply important to us, but also based on common sense and the long-term vision of our markets. We knowingly invest in projects that we know very few will succeed due to their complexity or inherent challenges, our added value being our 75 years of operational experience in Africa. By doing so, we are sure to fulfill our goals: job creation and training of new skills.?

11. Last but not least. Where do you see the future of the African continent in the next 20-30years, and how is your business preparing to adapt to these changes??

We are trying, humbly, in our own way to ensure that the African countries in which we are present can gradually transform themselves, create jobs, processing industries, and thus create sustainability for years to come.?

Africa represents an incredible opportunity for growth, wealth creation, and human transformation. For decades, Western countries have extended a charitable hand to Africa by offering few solutions for real economic transformation. It is now the last hour for them to realize that Africa will be an integral part of their demographic and economic future.?

There are tangible opportunities in Africa's economic development. These are long-term occasions and represent for family offices undeniable opportunities for those who want to be part of the next generation of wealth creation. To conclude, let me quote William Ruto, Kenya’s president, who said during the last Africa CEO Forum:?“Africa is no more on the menu; it now sits at the table”.??

Interested in learning and hearing more about Africa??

Join our Africa Wealth Summit on 13 & 14 of November 2024 in Mauritius. ?

https://grammigadvisory.com/africa/