The rise and rise of Africa

If Africa was considered a single country similar to USA or India it would be the tenth largest economy in the world.

This view point is being ratified now by the signing of the Pan Africa trade agreement. Indeed the biggest Trade agreement globally involving 50 countries.

As a united economy it is ahead of India, Brazil, Korea, the Russian Federation and Mexico in terms of sheer size, and possibly has more potential or at least as much potential, as many of its peers in the BRICs collection.

Africa’s imports from China have risen from less than$10 billion in 2000 to $79,366,274 in 2017 and China in return imports $ 99,026,182 (2018) according to Trademap – Trade Statistics for international business development. Although $ 49 billion of that was for oil, and $15 billion for raw ores slag and ash.

There are an estimated 400 million people in what is called the middle segment in Africa,(between very rich and very poor) or classically mid income markets. This segment is affectionately known by marketers as the Power of Africa 2.

Coca Cola sells more than 90 million units every day in Africa generating about $4-5 billion in sales revenues.

Bidco Oil refineries (not related to South Africa’s Bidvest), has created a business worth more than $160 million on the sales of cooking oil in Kenya.

M-Pesa has annual revenues of over $2.24 billion, it started in Kenya but has grown into several African countries.

Nike has operations in 30 countries in AFRICA.

Samsung has developed products specifically for Africa and is growing every day on the continent.

Diageo, Heineken, and Coca Cola have built their own infrastructure where there isn’t any and have also partnered on several projects in Africa.

What are the challenges?

As brands turn their sights to the African market, they must strive to understand a continent of diverse people and conditions that is becoming increasingly confident in its own creative self-expression.

Also, while many of the large multinational companies have deep enough pockets to invest their time, energy and money, what opportunities can be manifested for the average medium sized business?

While the total market represents a mouth watering $2.5 trillion it is important to know that Africa is by far not one big market. Selecting which country and which particular market and also exactly how you will approach it will ensure you don't waste energy, time and money trying to pluck fruit from an empty tree.