Africa Videos - Worrying reports to temper our enthusiasm and a few errors to learn from, as folks across the earth eye Africa for possible investment and South Africans head north there's some encouraging news to feed those ambitions.
Ghana's capital Accra is awash with well-informed, well-dressed youthful up-and-coming people, driving top-of-the-range cars dwelling in trendy houses. It's indicative of Ghana's economic growth, 14.4% last year. As Stated By the Planet Bank many African economies are forecast to be among the planet's quickest growing in 2012. Top of the listing are the DRC, Nigeria, Ghana, Liberia and Ethiopia.
"There's a fresh narrative appearing out of Africa: a story of growth, progress, potential and profitability." US secretary of state for African affairs, Johnnie Carson is quoted as declaring that Africa represents the next international economic frontier. China's trade with Africa attained $160 billion in 2011, producing the continent among its largest trading partners.
"Since The Economist unfortuitously labelled Africa 'the despairing continent' a decade before, a profound modification has taken hold." Now "the sun shines bright... the continent's remarkable growth looks likely to keep up."
Africa's trade with the remainder of the globe has skyrocketed by over 200% and yearly inflation has averaged just 8%. Foreign debt has fell by 2 5% and foreign direct investment (FDI) grew by 27% in 2011 alone
Despite projections for growth in 2012 being revised downward as a result of the so called Arab Spring, Africa's market is forecast to grow by 4.2%, according to an UN report previously in the year. The Global Monetary Fund (IMF) is expecting Sub-Saharan African markets to increase at above 5%. In addition to that, there are currently more than half of a billion cell phone users in Africa, while enhancing abilities and increasing literacy are imputed to some 3% increase in productiveness.
According to an UN report the think-tank, McKinsey Global Institute writes, "The price of return on foreign investment is higher in Africa than in any developing region."
An end to the access to ample natural resources, numerous military battles and economical reforms have promoted a much better business climate and helped propel Africa's economical growth. Greater political equilibrium is greasing the continent's financial engine.
Urbanisation and all this growth is putting a strain on social services in the towns, it has also resulted in an increase in urban consumers.
Subsequently there is the more sobering news. "A sustained slowdown in advanced states will dampen demand for Africa's exports," writes Christine La-Garde, managing director of the IMF. Europe is the reason more than half of Africa's exterior trade. Tourism may also experience as fewer Europeans come to Africa, effecting tourist dependent economies like Egypt, Tanzania and Kenya.
The South African Reserve bank warned in May the financial crisis in Europe, which consumes 25% of South Africa's exports, poses big dangers. Adverse effects on South Africa could have serious consequences for neighbouring economies.
Another worry is the resurgence of political disasters. Due to the so called Arab Springtime, economical growth in North Africa plummeted to only 0.5% in 2011. Recent coups in Mali and Guinea Bissau could have broader economic repercussions. "Mali was scoring very well, now we're straight back to square one," states Mthuli Ncube, the AfDB's chief economist. Uganda, Kenya, Ethiopia and also other states have militarily participated in Somalia, which might impede their economic systems. And Nigeria is grappling with Boko Haram, a terrorist sect in the north of the country.
A trigger for anxiety what many are talking about as Africa's "jobless recovery." Investors are focusing in the extractive sector, especially gold and diamonds, including oil, which generates fewer employment opportunities. 60% of Africa's jobless are aged 15 to 24 and about 50 % are girls. In May Possibly, UNDP raised an alarm over food insecurity in sub-Saharan Africa, 1 / 4 of whose 860 million people are undernourished. Africa Business review
But n one of this is deterring South African company interest north of the edge. One might ask why? South Africa's national market isn't providing local businesses with enough growth opportunities, prompting many to go through the remaining portion of the continent. This according to Ernst & Young's Africa Company Center's leader, Michael Lalor in an online press meeting recently: "While South Africa is still-growing well compared to the complex economies, it is definitely not keeping up with some of another rapid-growth markets." Says Lalor.
Analysts are pointing out that many of another emerging markets, such as China and South America, are difficult to enter, making the remainder of Africa the clear choice. Asia is viewed as almost excessively competitive. Latin America ventures mean dealing having an extremely strong and ever present Brazil. So Africa, offered its possible and its sustainable increase story, is an apparent area for South African firms to develop into.
Africa Business forum - Quoted by howemadeitinafica.com Lalor says that most Johannesburg Stock-Exchange-listed firms are developing techniques for the rest of the continent. Ernst & Young is encountering strong interest from foreign companies to purchase the continent. "The reply from our customers and from prospective investors is overwhelmingly favorable, to the extent that people just cannot keep up. Consequently there's no uncertainty that we're seeing important interest, both spoken, interest in nature, but also people putting their money where their mouths are," he mentioned.
A CEO survey released by PwC found that 94% of South-African firm heads expect their business in Africa to increase in the coming 12 months. 32 South-African CEOs were interviewed by pwC in the ICT, financial services, and customer and industrial products and services industries.
Bearing this in mind it is worth looking at Raymond Booyse, founder of consultancy company Expand into Africa, who determined four errors often made by South African companies venturing to the remaining continent.
The first was: Not performing your homework. South African companies are often not willing to spend cash on market research. "Go and look if there is a marketplace for the services or products. When you have confirmed that there is indeed a marketplace, find out who your competitors will be," claims Booyse.
Booyse points out that South African businesses underestimate transportation costs and dismiss how neighborhood laws and rules influence doing business.
Secondly: Ignorance. Many South-African business individuals are unaware of local cultures and approaches based on Booyse. Through example, ignorance does not realise that just simply because they are both former Portuguese colonies, what functions in Angola's capital Luanda, doesn't always mean it'll work in the northern Mozambique. In a recent report, research firm Nielsen noted that African consumers' approaches towards technology, fashion and the best way to spend leisure time vary considerably.
Thirdly: Conceit. Booyse says that South Africans occasionally believe they understand what folks in the remaining part of the continent demand. "In the rest of Africa, South Africans are regularly regarded as haughty."
Finally: Many South-African companies are not aware of the high costs involved with doing company in the rest of the continent. "If you wish to spend two weeks in Angola it will cost you R40,000 (US$4,700)," notes Booyse. "It isn't affordable and simple." Flights for example, from South Africa to both Kinshasa or Lubumbashi can be costly, and hotel rates are also very high.
It Is apparent that Africa is a rich place to plant seed. But Africa is perhaps not for the fainthearted as company is completed in a totally different manner to elsewhere on the planet, with all manner of social and political hoops to jump through. South African businesses possess clear advantages if they are prepared to take risks, stay humble and do their assignments and a potentially bright future.
I'm Matthew Campaigne-Scott. I spent 19 years working in Missions and Ministry. I'm currently enjoying the life of a freelance author.
I have written for periodicals and web sites, composed sermons and speeches and ready copy for web advertisements and research papers. I can tailor my work according to your requirements. I adore a challenge and take pleasure in establishing work relationships.