Africa is getting growing attention as the today’s biggest opportunity hotspot. Sub-Saharan Africa (SSA) is the “final frontier” for growing your business and expanding your market reach. So if you’re ignoring it, you’re doing so at the peril of your business.
SSA is a region larger than the United States, China and India combined and has five of the world’s ten fastest growing economies. The investment and business development opportunities for micro and small foreign businesses are unparalleled in comparison to those of other continents, and the region’s sustained growth prospects are strong. But to see and appreciate them, you have to be willing to go through the looking glass.
Don’t look at Africa in a warped mirror
When we look into the traditional investment mirror, the image reflected back is a backwards image of Africa. It just does not reflect today’s Africa. Sub-Saharan Africa has morphed into a hopeful continent on the rise. It has the most untapped investment potential and business development opportunities and offers immense prospects to U.S. micro small companies looking to grow, expand or diversify.
Unfortunately, most U.S. businesses are overly skeptical and shy away from the reflection in the mirror. If you’re one of them, what you don’t realize is that what you see in the mirror is distorted by tainted negative historical beliefs, foreign territorial interests and business monopolies, and stereotypes and perceptions of the continent: poor and corrupt, unstable and insecure, lacking in infrastructure and with small and fragmented markets.
I lived in West Africa for ten years, and I can assure you that this is a very limited and limiting view of the region and its peoples. It also does a great disservice to U.S. micro and small business with potential to do business in SSA. Today, I invest in West African countries by helping small businesses like yours see and appreciate the REAL reflection of SSA in the mirror.
Africa through the looking glass
Many analysts and big business investors look at Africa and see a scramble, the reflection of an alarming image of confusion, disruption, and a free-for-all tussle. But if you look through the looking glass, what U.S. policymakers and big business investors interpret as a “scramble” is actually an unscrambling of the disorder and disarray introduced by European Partition of Africa between 1881 and 1914, later continued with the subsequent wave of resource and strategic exploitation by European nations, the U.S, Canada, and China.
Comprised of 47 nations, the region no longer reflects a “hopeless continent”. It is the next rising sun in our overcast world economy. Its population of almost 1 billion people is projected to double by 2050. The size of the regional economy has more than quadrupled since 2000. It has the most dynamic consumer market in the world, with its present $1 trillion consumer spending expected to reach more than $2.1 trillion by 2025. And its economies have been resilient and gaining momentum, sustaining a remarkable 18 years of sustained growth.
According to the African Development Bank, real output growth is estimated to accelerate to 4.1% in 2019, up from 3.6% in 2017, and poised to continue accelerating to grow by 5%-6%. Compare that to the Congressional Budget Office’s forecast for the U.S: a projected growth of 2.4% in 2019 and a continued slowdown from there.
Look out at Africa from the inside
Ungraspable for those who see SSA from the outside in, the unscrambling of the region’s true image by those looking out from the inside has given African governments more bargaining power and the ability to negotiate better deals to capture more value from their resources and require sharing of management skills and technology from buyers. Government policies have strengthened the regulatory and environment and legal systems, enabled improvements in critical physical, market and social infrastructures, and facilitated the emergence of a stronger private sector comprised of mainly micro and small businesses.
SSA’s business environment has also improved significantly since 2009 and its economy has diversified away from natural resources. Although the region has benefited from a surge in commodity prices, it is actually non-resource-intensive economies that have surged forward. Two thirds of the region’s growth comes from a range of other sectors, including agriculture, manufacturing, construction and especially services (transportation and logistics, retail and wholesale, telecommunication, business services).
These improvements have helped SSA gain increased access to international capital. Capital inflows into the region have increased from less than 2% of GDP in 1990 to 10% in 2011; after dropping to 6% in 2013, it is now at 8% and increasing. Direct investment has grown to become a larger share than that of portfolio or other types of investment. And although still mainly concentrated in Nigeria, Angola and South Africa, foreign direct investment (FDI) is rapidly diversifying into the West African Economic and Monetary Union (WAEMU).
Why are you losing out?
You and your small business are losing out, because American mainstream press and international trade support organizations continue looking at Africa in the dark mirror of yesteryear.
Sure, there are pockets of unrest, insecurity and violence. And, yes, there are certain countries I wouldn’t recommend doing business in right now, unless you have a very strong stomach for high risk. But let’s be real. Those pockets exist anywhere and everywhere in the world, even in the U.S.
What’s important is to recognize that the next wave of change forward in sub-Saharan Africa is in the making and picking up momentum. It is powered by a youth-driven demographic dividend, evolving technological advances in the mobile ecosystem, expanding internet access, and what may perhaps be the most dynamic entrepreneurial spirit in the world. Domestic economic opportunities are growing as markets increase connection and integration across the continent and beyond, and by 2030 GDP per capita is expected to reach the level where emerging Asia is today.
As SSA economies lessen dependence on commodities and foreign aid, expand the private sector, increase productivity levels and create jobs, the region will be the one leading the world economy on a path to more inclusive, sustainable and robust growth. The opportunities for U.S. micro and small businesses are immense.
So let’s STOP looking in the traditional dark mirror that reflects a backwards image of Africa.
It’s time to start looking at the sub Saharan region through the looking glass. SSA has morphed into a hopeful subcontinent on the rise. It has the most untapped investment potential and business development opportunities of any region in the world. It is, indeed, the “last frontier” for smart business: it offers immense prospects to U.S. micro small companies in non-extractive sectors looking to grow, expand or diversify.
Can you imagine creating a leap in value and shaping industry conditions in your favor to achieve rapid and profitable growth without scaling to big while also generating wealth and benefit for Africans? Are you ready to stand apart from the competition? Then GO! through the looking glass. Seize the new growth opportunities that are untapped in sub-Saharan Africa!
If you want to find out more, UpBoost can help you look through the looking glass to identify specific viable opportunities for your business. All you need to do is contact me at firstname.lastname@example.org.
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