There is a general acknowledgement that the African continent is poised for growth in the 21st century. Some commentators have even gone so far as calling the 21st century the African century. The debate is no longer about whether there will be significant growth from the continent or not, but rather about the scale of the growth. A recent McKinsey study reported that every indicator – economic, social, political – are showing positive trends. Africa’s collective GDP, at $1.6 trillion in 2008, is now roughly equal to Brazil and Russia, having grown at 4.9 per cent per year since 2000. According to the Economist Intelligence Unit, from 2012-2015 the sub-Saharan regional economy is forecast average growth of nearly 5% per annum. The World Bank is also forecasting similar growth percentages (5.5% for 2012) for sub-Saharan Africa, making it amongst the fastest growing regions in the world, albeit from a modest baseline.

Political and macroeconomic stability on the continent have improved significantly, with a number of long-standing conflicts resolving their deadly hostilities to create the political stability necessary to foster economic growth. Africa’s economies have grown healthier as governments lowered inflation, trimmed their foreign debt, and shrunk budget deficits. State-owned enterprises have been privatised, trade barriers reduced, corporate taxes cut, and regulatory and legal systems have been strengthened. Investments into primary, secondary and tertiary education, welfare and health have created a workforce with unprecedented capacity and skills – labour force productivity has climbed 2.7 per cent annually since 2000. Although many governments still have a long way to go, these important steps have enabled a private business sector to emerge, which has allowed for growth across a range of industries, including the wholesale and retail trades, transportation, agriculture, communications, telecommunications, and manufacturing.

For each country and region in which we engage, Belief performs a country specific analysis on economic outlook, business climate, culture and growth industries. We identify potential partners, customers and suppliers that will allow their businesses to flourish within a new environment, or to branch out into new markets.
Early movers can take advantage of great opportunities in industries with high-growth potential on the continent, as well as in cross-border growth regions and high traffic trade corridors. Belief will work with our partners to transform complex challenges into a series of strategic and action-orientated steps to building a sustainable business. Some key trends and drivers are worth highlighting regarding Africa’s long term economic prospects:

• African economies are diversifying, and growth is not solely fuelled by resources, extraction or construction. The active pursuits of governments to improve business conditions, to promote stability and the rule of law and to improve social conditions have resulted in economic spillover effects that have allowed economic growth across countries, regions and industrial sectors.
• Global demand for commodities will further advance the growth potential in Africa, in conjunction with international partners, who are likely to inject considerable amounts of capital in the coming years.
• Growth will be fuelled further by internal factors, such as social and democratic trends, a growing and better educated labour force, increased urbanisation and more discretionary spending power by a burgeoning African middle class.
• Key advances are expected in retail, telecom and banking, as well as in infrastructure related industries, agribusiness and resources/extractive sectors.

Political, social and macroeconomic stability and microeconomic reforms have been identified as central elements lubricating Africa’s growth surge, along with measures to lower inflation, cuts in foreign debt and reduced budget deficits. Policies have also been actively pursued to generate more favourable business environments, such as tax cuts, elimination of trade barriers, interregional cooperation and the strengthening of regulatory and legal frameworks. Even though there is still considerable scope for improvement, such steps have formed a solid foundation for businesses – local and international – to thrive.