Despite the recent economic drag responsible for sluggish regional growth, African economies are rapidly expanding, offering significant opportunity for private enterprises and investors across the globe, a report has shown.
This, according to a report launched by the International Finance Corporation (IFC), a member of the World Bank Group, on new investment opportunities in Africa, at the 6th Africa CEO Forum, in Abidjan, Cote d’Ivoire, finds that the region’s economic potential is beyond recovering commodity prices, but other forces like favourable demographic trends, economic reforms, infrastructure investment, buoyant services sectors, and strong agricultural production.
Entitled Shaping the Future of Africa: Markets and Opportunities for Private Investors, in partnership with the Africa CEO Forum, the report notes that growth recovered from a two-decade low of 1.3 per cent in 2016 to an estimated 2.4 per cent in 2017, is projected to improve further to 3.6 per cent in 2020.
The report states that certain sectors show potential for high growth due to productivity gains or consumer demand. “Food production and agriculture stand out in a region that continues to import food, while a rapidly urbanising population requires more choice. Africa’s need in infrastructure remain vast, and a range from power to transport to sanitation, among other areas.
“Beyond conventional policies to improve productivity, adopting innovative practices and technology can help Africa’s growth through leapfrogging. Access to finance, for example, is low, yet Africa has led the world in innovative financial services based on mobile telephony, that is opening new opportunities to increase financial and other services through reliable payment systems.”
It also highlights obstacles that has continued to constrain Africa’s development and competitiveness, which include lack of financing and the infrastructure gap. It also states that joint efforts by governments and private sector, supported by development partners, can beat address such challenges and create opportunities.
Vice President, Economics and Private Sector Development, IFC, Hans Peter Lankes, assures that there are considerable opportunities for investors to seize on favourable trends, adding that Africa’s growing middle class is consuming a wide range of goods and services, while technology is changing the services delivered to consumers. “The result is enormous potential across a range of sectors in Africa.”
Founder and President, Africa CEO Forum, Amir Ben Yamid, described the report as a demonstration of the abundance business opportunities today in Africa, noting that the event was founded to provide a dialogue that engages business leaders and helps investors turn the opportunities into successful projects that create jobs and drive Africa’s economic development.
IFC Vice President for the Middle East and Africa, Sergio Pimenta said the continent is the top priority for IFC. He said IFC aims to mobilise more private capital to address development and inclusive growth challenges in Africa, notably in infrastructure and agribusiness.