A Middle Class Market of 350 Million People January 10, 2017
Curt Cultice is a Senior Communications Specialist in ITA's U.S. Commercial Service
Country Commercial Guides Put Africa into Focus
With so many global opportunities, what are some expert suggestions as to which markets U.S. companies should include in their initial research? In a recent blog, Jack Leslie, Chairman of Weber Shandwick and the U.S. African Development Foundation as well as a member of the President's Advisory Council on Doing Business in Africa, offers some valuable insight:
"The integration of the African continent in the global economy is one of the most significant?-?and, to me, energizing?-?trends of our time. Companies looking for the next great business market to invest in or sell goods and services are flocking to Africa?-?and for good reason. Africa's middle class has expanded to 350 million people. Between now and 2025, Africans are expected to spend an estimated $4 trillion?-?equal to the size of Japan's economy today."
Expanded U.S. Commercial Service Footprint
As part of President Obama's Doing Business in Africa initiative (DBIA), the U.S. Commercial Service recently expanded its footprint throughout sub-Saharan Africa. In addition to its offices in Nigeria, Kenya, Ghana and South Africa, the U.S. Commercial Service has increased its presence from four countries to eight by opening new offices in Angola, Ethiopia, Mozambique, and Tanzania. The U.S. Commercial Service also partners with the State Department in 23 U.S. embassies throughout Africa which also provide export promotion services.
For many current and potential U.S. exporters and investors, the growing opportunities in Africa make the new Country Commercial Guides (CCGs) even timelier. Why? Because now there's even more Africa market research available through updated and expanded CCG global coverage. In 2016, the Africa portfolio has been upped to 32 countries, with the addition of new CCGs from the Sub-Saharan Africa countries of Chad, Sao Tome and Principe, Uganda, and Zimbabwe-bringing the total CCG coverage to more than 140 countries worldwide.
Each CCG features "boots-on-the-ground" market intelligence compiled by U.S. commercial and economic officers based at U.S. embassies and consulates abroad. The CCGs include market-by-market economic overviews, selling techniques, investment climate considerations, trade financing options, and business travel advice and resources.
In addition, the CCG portfolio also includes a World Bank Group Commercial Guide that provides insights into how World Bank-funded projects work, and how American firms, from prime contractors to subcontractors and suppliers, can identify and access opportunities, including those in Africa.
A Growing Regional Business Environment
According to the International Monetary Fund, Africa has three of the world's top-ten growing economies in terms of projected percentage real GDP growth for 2016: Côte d'Ivoire is the 3rd fastest growing economy at 8.0%, Tanzania is 6th at 7.2%, and Senegal is 9th at 6.6%. The World Bank's Doing Business Report recently ranked Sub-Saharan African economies among the world's top improvers of business climate.
Along with citing Africa's sustainable growth, rising incomes, and economic diversity, Leslie points to another major trend of interest: while Africa's GDP and labor force are today highly dependent on agriculture, the manufacturing sector is also growing and is expected to double from $500 billion in economic output today to $930 billion by 2025.
"Africa has the advantage of a young population and will soon have the world's fastest rate of urbanization," Leslie says. "Africa's young workers are highly entrepreneurial and increasingly skilled and educated. Within two decades, Africa's workforce will be larger than either that of China or India."
Need further incentive to explore the African market? Read on to what Leslie has to say:
"In my capacity as Chairman of the U.S. African Development Foundation, I have seen first-hand the power of African entrepreneurship, and the eagerness of the continent's young workforce to partner with investors from the U.S. and around the world. Africa is the continent of the future. I would encourage U.S. companies to update their global business strategies today to ensure they are positioned to take advantage of Africa's rising."
Is your company ready to get started? Do your research now by visiting the U.S. Country Commercial Guides at www.export.gov. On the site, you can also find out more about U.S. Commercial Service export assistance through our global network of 108 U.S. Commercial Service offices across the United States and in U.S. embassies and consulates in more than 75 countries, including our offices in Africa.
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