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Industry Growth in Africa Draws Global Attention

If you want to ride Africa’s business boom, choose your country well and be ready for bumps on the road. But the momentum is upward and you will be rewarded if you stay the course.

African policy-makers and chief executives of companies operating in Africa are spreading this upbeat message, qualified with some caveats, as interest in what was once dubbed the “hopeless continent” blossoms along with growth rates.

Few doubt that the Africa rising narrative, which has grabbed the attention even of traditional sceptics, is based on solid fundamentals: growth outpacing most of the world, a rising young population of workers and consumers and global demand for the continent’s commodities.

“I absolutely believe in a consistent upward trend,” said Diana Layfield, Chief Executive Officer for Africa of Standard Chartered, the London-listed bank which is investing $100 million in Africa to double its business in the next five years.

But this bullish pitch for Africa, enthusiastically echoed by most participants at a Reuters Africa Investment Summit this week, comes accompanied with a caution that the continent remains a volatile, uneven and challenging place.

“If you were to compare it to the emergence of some markets in Asia, you’ll see … more bumps in the road,” Layfield said.

While hubs like Nigeria and Kenya project the continent’s potential, pockets of instability and flickering violence in old and new hotspots such as Democratic Republic of Congo, Mali and, more recently, Mozambique, serve as a constant reminder of a turbulent track record.

Investors in the continent of 54 states – most of them south of the Sahara – must also get to know the different markets, cultures, and regulatory frameworks. That makes it distinct from fast growing Asian giants India and China.

“With the best will in the world, nobody can be a good investor across 44 countries,” said Marlon Chigwende, Managing Director of the Carlyle Group’s $500 million Sub-Saharan Africa Fund, which has just signed its second deal.

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