The State of Consulting in Africa: A Growing and Dynamic Industry

Article By lawrence Maina

The consulting industry in Africa has witnessed significant evolution, with a market size now estimated at USD 10 billion, It expands at approximately 5-7% annually according to consulting quest. This sector is undergoing transformative growth, influenced by several key factors, such as an increase in local consultancies and an ever-increasing demand for services across different industries.?

Historically, the consulting industry on the continent did not take off until the early 21st century, but today it presents substantial growth potential, especially given Africa's economic and social challenges.

Growth of the African Consulting Industry

Africa's consulting market has grown at a steady rate, with firms adapting to the continent's specific needs and the increasing diversification of its economy. Currently, the industry comprises approximately 29% of large multinational firms According to data collected by ConPulse, a CQ Global directory, which is significantly higher than the global average.

Meanwhile, local consultancies are on the rise, making up 57% of firms, many of which specialize in niche areas such as strategy, operations, and human capital according to the same source.

Key markets driving this demand include Nigeria, South Africa, Ethiopia, Morocco, and Kenya. These countries have seen a growing need for consulting services, especially in sectors like financial services, energy, and infrastructure development.

Despite challenges such as political instability, economic volatility, and issues with payment collection, the industry continues to expand, adjusting to regional dynamics and customer demands.

Shifts Toward Local Expertise and Technological Advancements

One of the most significant trends shaping the African consulting landscape is the increasing role of local firms. While global firms maintain a strong presence, the rise of indigenous consultancies reflects a shift in the industry’s focus toward understanding and addressing local challenges. Many local firms are positioning themselves as experts in specific areas, providing tailored solutions that foreign firms may overlook.

The SMART Africa initiative is an example of this shift, promoting digital projects across the continent and encouraging a move towards leveraging technology for economic growth. As Africa continues to integrate new technologies such as mobile services, the Internet of Things (IoT), and digital marketplaces, consultants are needed to help businesses navigate these rapidly changing landscapes. This has created a growing demand for consulting services that support technological transformation across industries, enabling businesses to stay competitive.

Regional Strengths and Sectoral Focus

Southern Africa, particularly South Africa, accounts for nearly two-thirds of the continent's consulting market. West Africa, especially Nigeria, is also showing double-digit growth, while East Africa, buoyed by its emerging middle class and fast-growing economy, continues to attract investors. Ethiopia stands out as a leader in East Africa, with projects aimed at infrastructure development and industrialization driving consulting demand.

The African consulting market is diverse, catering to various sectors including financial services, energy, infrastructure, education, and agriculture. Despite the prominence of financial services, consulting services targeting agriculture and natural resources remain essential in many regions, as countries seek to diversify their economies and become less reliant on exports of raw materials. For instance, Ethiopia, Senegal, and Ghana are adopting policies aimed at bolstering agriculture and energy, which further increases demand for consulting expertise.

Challenges and Opportunities in the African Consulting Market

Africa’s consulting industry faces its share of challenges. Political instability in certain regions, reliance on foreign investment, and market volatility continue to be significant risks. However, these challenges also present opportunities. Governments across the continent are increasingly seeking consultancy support for their development goals, particularly in the areas of tax reform, access to banking services, and the expansion of capital markets.

Moreover, as African economies embrace digital transformation, consultants are becoming vital partners in guiding this transition. With McKinsey Global Institutes predicting a 25% increase in the use of mobile technologies and IoT in Africa, consultants are playing a key role in helping businesses adopt and optimize these technologies.

The Future of Consulting in Africa

The future of consulting in Africa looks promising, with several factors contributing to its growth. The continent's young population, abundance of natural resources, and increasing political stability create a fertile ground for economic expansion. As more African businesses turn to consultants for strategic guidance, the industry is expected to grow at a rate of around 5-7% annually.

African consulting firms should upgrade their strategic, human capital, and technological capabilities in the coming years. By focusing on these areas, consultants can help businesses become more competitive in the global market, fostering innovation and economic development across the continent.

Axcel Africa Consulting?

Axcel Africa plays a crucial role in the emerging industry by providing the much-needed linkage between African economies and the Japanese industry. Through our deep understanding of both markets, we facilitate cross-border partnerships that foster innovation, technology transfer, and economic development. By bridging these two regions, we empower African businesses with access to Japanese expertise, investment, and industry best practices. Furthermore, we also enable Japanese companies to explore new growth opportunities in Africa. This strategic collaboration not only drives mutual economic growth but also strengthens long-term partnerships between Africa and Japan.

In conclusion, the African consulting industry is undergoing a dynamic transformation, fueled by economic diversification, increasing demand for specialized services, and the rise of local consultancies. As Africa positions itself as a key player in the global economy, the consulting sector plays a crucial role in driving growth across industries like financial services, energy, and infrastructure. Despite challenges such as political instability and economic volatility, the industry’s resilience and adaptability continue to unlock new opportunities. Firms like Axcel Africa are at the forefront of this shift, bridging the gap between African markets and global players, particularly Japan, and facilitating cross-border innovation and sustainable development. With continued investment in human capital and strategic initiatives, Africa's consulting landscape is set to play an even greater role in shaping the continent’s future.

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