bottom line Doing Business in Africa
The 2017 Global Innovation report
has identified agriculture as a
leading area of innovation. Africa is
poised to capitalise on this through
the Fourth Industrial Revolution.
Technology will become a
key differentiator. A Harvard
research paper showed that
venture capitalists injected a
billion US dollars into Africa,
specifically in technology
start-ups, from 2012 to 2018.Which countries
present the
biggest business
opportunities?
East Africa continues to attract
significant foreign investment,
with countries such as Ethiopia
opening for manufacturing in
fields such as agro-processing,
pharmaceuticals and leather.
In Southern Africa, South
Africa is still the strongest
economy, but growth is stunted
due to corruption and political
uncertainty. Mozambique,
with its opportunities in gas,
is attracting huge interest from
multinational corporations.
In West Africa, Nigeria has a
huge market, but is still trying
to run away from depending
on the oil economy. Ghana is
building its capacity to play on
the global market, with Google
developing the first artificial
intelligence centre in Africa there.
In North Africa, the big
players continue to be Egypt,
Algeria, Tunisia and Morocco,
with oil and population size
being the biggest attractions.What are some of
the misconceptions
about africa?
People tend to think of Africa
as one country, and oftenplease tell us
more about your
background.
I was born and bred in
Zimbabwe, have done business
in more than 20 African countries
over the past two decades, and
have completed a doctorate
on the impact of institutional
factors on strategies employed
by multinationals venturing
into the continent. My passion
is to see Africans capitalise
on opportunities in Africa.
you describe
yourself as an
african realist. Why?
I look at the opportunities
and challenges in Africa
through a healthy blend of
optimism and reality.
there Was much
hype some years ago
about the business
opportunities in
africa. Why Was this?
The continent’s population
is expected to double to
two billion by 2030, which
implies a huge consumption
base for industrialised countries
wanting to push their products
onto growing markets. Where
the majority of developed
countries are struggling with
ageing populations, Africa is
dominated by young people.
The continent has vast
underdeveloped resources.
This, in combination with the
labour offering, is attracting
large investments from
Europe, the US and China.
Where doing business in
Africa used to be like trying
to tame the Wild West, the
business environment has
become more accommodating.
Technology, for
one, has made
significant inroads,
allowing Africa to
leapfrog over many
challenges, such
as health, inclusive
banking, education
and agriculture.much of this
hype has died
doWn. What
happened?
Africa is still plagued
with corruption at
both the individual
and institutional level. Peace
and stability are lacking in key
countries, such as the Democratic
Republic of Congo (DRC), with
its diamonds, and problems with
Islamic militant groups, as is the
case with Boko Haram in Nigeria.
In Zimbabwe, a new era has
dawned, but economically the
country is still far from seeing
the light, whereas Ramaphoria
in South Africa is disintegrating
in the wake of state capture.
New presidents, such as
Paul Kagame in Rwanda and
João Lourenço in Angola,
bring nuggets of hope,
but this is not enough.
This instability has a serious
impact on investor confidence.What is the
medium- to long-
term outlook for
business in africa?
In the short term, leadership,
peace and stability will be key
factors influencing the outlook.
Long-term initiatives, such as
the African Continental Free
Trade Area agreement, will see
the unlocking of trillions of
dollars if implemented correctly.Thinking of doing business in Africa? Dr Rutendo Hwindingwi, also known as the ‘African
Realist’, spoke to Glenneis Kriel about where the potential profits and pitfalls can be found.
Africa: a continent brimming
with business opportunities
Dr rutenDo
HwinDingwisupplied30 farmer’sweekly 2 august 2019