Some might not include Africa in their thoughts of business. However, Africans are no less than people from other continents. The same applies in cases of business opportunities. People seem to have America or Europe in their first thoughts of business. Well, these continents are indeed leading every business sector. In some instances, Asia is also number one. But you should consider Africa’s business markets too in upcoming years. That leads to a question- why do business in Africa?
The whole Africa continent is advancing in technology and other aspects faster than ever.
If you still haven’t given enough thought about why to do business in Africa, maybe it is time you did so.
In the next paragraphs, we will share some African business opportunities that you haven’t known or thought about yet.
We will also include some good reasons about why do business in Africa.
Hopefully, at the end of the article, you will find many new ideas to think about.
Also, hopefully, you will consider Africa for your next business.
Why do business in Africa?
We will answer this question throughout the article. But, let us point out some key features first.
There are some keys to the success of a company or startup. Some features lead to those keys.
We will discuss some of those key features to evaluate the opportunities of doing business in Africa.
Demographics help us understand the opportunity of a startup. And the population plays a central role in demographics.
If you know about different generations, you maybe know how crucial Gen Y and Gen Z are. And guess what?
More than 50% of Africans are under the age of 20 years. So if you can reach them, there is much possibility for your success.
We tend to place China at the top of business opportunities. But only 28% of the total Chinese population are under the age of 20.
So although China is leading now, the future belongs to Africa. Another parameter of success is the market of that startup.
And if the population is large, the market is also large. Statistics show that by 2050, 40% of the total global population will be from Africa.
Besides, there are 500 million people in Africa between the age of 18 and 24.
This range is the known range of reproductive age.
With this many people currently in this age-range, there will be 1.1 billion in 2040, as estimated.
That is a tremendous amount for the market of any product.
But when the population reaches that number, there will be more competitors too.
As you already know, over competition will bring down the hope for your success.
So make no delay. Invest now in the African market. Hopefully, you will get better results within a short period.
Also, Africa is growing fast in population.
So if you can reach them at the heel of their population growth, you will be able to rule the market at the peak.
The workforce plays a vital role in the success of a company.
As we all know, India and China are leading the current world just because they have a large workforce.
But Africa is going to take their place soon enough.
That is to say that Africa has a growing force.
In recent years, the workforce ratio of Africa has grown from 28% to 32%.
If there is enough economic support in Africa, there will be a fair chance to use that large workforce.
And if the rate continues, hopefully, Africa will have a larger workforce than India or China has today.
Besides, more than half of the total population of Africa is under the age of 18.
It exerts an incredible potential for change and growth in the workforce.
This young generation will bring jobs, capital, innovation, skills, and so many more.
As a result, we can say that Africa has a great marketplace coming.
And that is why you should get a hold of that potential marketplace from now.
Economic performance is an essential landmark to determine the business opportunity of a country.
The same applies to a continent like Africa. And guess what?
Africa’s economic performance is growing faster than any other continent.
For example, Africa’s GDP growth was 5.4% in 2013. But in 2014, the GDP growth became 5.7%.
Since then, it has never stopped growing.
Besides, Africa has some economies growing faster than many other economies from other continents.
In fact, among the top ten fastest-growing economies of the world, six belong to Africa now.
So you can easily say that the African economy is very fertile now.
One of the most common complaints that we find about doing business in Africa is the poor infrastructure.
Maybe this is the only reason holding you back. However, the entire situation has changed.
There have been massive investments in the infrastructure sector of Africa.
As a result, we see that the expenditure in this regard has doubled in the last decade.
Now, the spending stands over 3.5% of Africa’s total GDP, as many business enthusiasts claim.
The US government has also taken long-term initiatives for the African infrastructure growth.
Across sub-Sahara, there has been an investment of about 32 billion dollars since 2013.
And in the upcoming years, we can hope for more such sponsorships.
As we go through the claims, we can say that it is just the beginning.
The infrastructure is yet to be built.
For example, there is a substantial upcoming population in Africa.
There has to be a large number of infrastructures to accommodate them.
This phenomenon gives the governments on the continent a huge opportunity. They can create jobs.
Also, economic growth is even more possible than ever, as we mentioned before.
These opportunities also include different companies and communities.
For your company, hence, you can think about the African marketplace.
If a community is already industrialized or going under industrialization, it is the perfect spot to start a company.
The continental marketplace is no different. That is because the continent is going under colossal industrialization.
Manufacturers are producing everything. It includes automobiles as well as processed foods.
As different estimations suggest, Africa’s industries will double their production within a decade.
At least there is an opportunity to do so. And the estimated amount is no less than one trillion dollars.
Traditional manufacturing possesses three key characteristics- exportability, high labor intensity, and higher productivity.
Industries like tourism, services based on information and communication technologies, agro-industry, etc., are development escalators.
That is because they have those three key characteristics.
And as their revolution is ongoing, the manufacturing centers may shift from China. And guess what?
Regions with lower costs, like Africa, will be the center. So that is another reason why do business in Africa.
Advancement in mobile access and digitalization
Many business owners tend to forget the role of digitalization in today’s world.
As in a digital world, mobile access and networking play a vital role in the success of a company.
And that is another reason why do business in Africa.
The fastest rate of new broadband connections was in Africa between 2018 and 2015.
Between the years 2017 and 2022, mobile usage is expected to increase sevenfold in the continent.
It opens up a significant opportunity for any business. A statistic stands for the claim.
There are 120 million active mobile money accounts in Africa.
It is more than half of that of the whole world.
As a result, you can access the continent through not only traditional banking but also internet banking.
Eventually, there will be a productivity improvement, and the transactions will speed up.
This whole new aspect will add a total of extra 300 billion dollars to Africa’s GDP by the year 2025.
So why should not you join the game?
As we are standing at the beginning of a new decade, the probability of success is much more than ever.
Some more advantages of Africa for business:
We included some reasons why you should invest in Africa.
Now, there are some additional Africa investment opportunities.
Impact of women empowerment
Women are more active than ever in the current world.
As a result, we see more women’s activities and activists now than ever.
African women are leading the revolution.
90% of the total food providers in Africa are women. There is more.
70% of the whole labor in the continent is women.
We find many African women entrepreneurs and CEOs.
Besides, these women are empowering others. So if you are a female, you have greater options.
Diverse countries and cities
At this point in the article, you must remember one thing.
That is, Africa is not a single city or country.
It is a continent, and the cities and countries within are diverse.
In terms of countries, Africa has 54.
They all are diverse in terms of population, growth rates, stability, development levels.
For instance, Nigeria has a population near 200 million.
On the other hand, Egypt has somewhat near 100 million.
And most of the countries on the continent have a population of under 20 million.
The countries are also small, though.
The proper choice of country for your investment is one of those tactics.
Elaborately, three countries make up three-fourths of the total GDP of the continent.
Nigeria holds 20 percent, while Egypt and South Africa contribute 30% combined.
But that is not all. Other small countries are growing very quickly.
As a result, their share in the total consumption and continental GDP is also rising.
Experts expect a significant GDP increase in the small countries within a few years.
Now come to the point of view for your company.
If you are trying to get across the competition, you should consider the small countries for your startup.
That is because there is not much competition yet in these countries.
On the other hand, if you want to compete and win, the top 9 countries of the continent might be your place.
Either way, you have a good opportunity for success, that we can say for sure.
That is another reason why do business in Africa.
The abundance of natural resources
Natural resources are crucial for a country.
And unlike many other continents, Africa is far ahead in this aspect.
Not a single category of natural resource is absent in the continent. You name it, Africans have it.
But guess what? The country is a hotspot for oil companies.
Many other small countries also possess the same resources.
The only lack is of proper technology to unleash those resources.
However, with the advancement in technology, it has also become possible now.
Besides, in the upcoming years, the progress will continue. And hopefully, doing business will be much easier then.
Also, if you can come up with the necessary technology, you have an immense opportunity.
Maybe that is why we see many technology-based new businesses in Africa now.
The African market was once a complicated place for startups.
Investing here was thought to be one of the complex things.
However, the time has changed. And so has changed the African continent.
Africa is no more lagging now. Recent updates and statistics prove that.
Besides, there is the massive growth of population that one must consider.
All these factors indicate why you should start doing business in the continent.
Moreover, these factors removed the question of why do business in Africa.
The only question left now is when are you going to join the African industry.
And for good progress, that time is now.
In the article, we have tried to include every potential opportunity of doing African business.
Hopefully, you have learned something new. And more hopefully, you will implement those ideas into your strategy.
After all, that is what matters.