WHY YOU SHOULD INVEST IN THE AFRICAN ECONOMY

 Africa is progressively transitioning from a continent of handouts and liabilities to one of possibilities, investment, innovation, and development. This is due to Africa's expanding young population, urbanization, which is predicted to shift over half of Africa's population to metropolitan by 2050, and the continent's establishing economic. Venture capitalists should be aware, however, that Africa is a place where perseverance will be challenged. Concepts that have succeeded in other parts of the world may not work in Africa. An investor that is patient and invests in Africa will prosper.

Why trade in Africa, one might wonder.

The following are some of the factors why an investor should be interested in Africa.

1. Young and expanding population: Africa now boasts a population of over one billion people. According to United Nations demographic forecasts, about 60% of Africa's population would be under the age of 25, ranking Africa the world's youngest continent in 2019. In 2020, Africa's average age 2020 was 19 years 8 months. Africa has a youthful population compared to the rest of the globe. This means that, despite the fact that the working population is shrinking, Africa's workforce would be around 1.1 billion, which is larger than China and India's combined. The fact that the population is youthful might be an indication of economic prosperity. Young Africans also like to acquire the most up-to-date items, services, and technologies, all of which benefit the investor.
2. Customer preferences are shifting: Africa's middle class is expanding, resulting in new demands and a shift in buying patterns. The young African middle class, according to the World Economic Forum (WEF), is youthful, brand-aware, and smart in terms of production and consumption. This means that multinational merchants and consumer brands may profit from these Africans' requirements and desires by investing in the continent.
3. Cash to spend and a passion for companies: According to McKinsey, consumer spending would exceed $2.1 trillion by 2025, while company expenditure will reach $3.5 trillion, totaling $5.6 trillion in business and investment potential. Before acquiring any goods, most Africans prioritize quality and brand. According to a McKinsey consumer survey, roughly 58 percent of customers are brand loyal, and many are prepared to pay more for well-known companies. The consumption of such items is higher among city inhabitants.
4. Economies that are more diverse and stronger: Previously, African nations' economy were mainly reliant on agriculture and natural resources. African economies, on the other hand, are now expanding beyond goods. Diversification of the economy is also aided by the improvement of Africans' talents to enable them to enter industries where there were previously no or few Africans. African nations are also concentrating their efforts on non-commodity areas in which they can compete. Every African country already has "Investment Promotion Agencies," which serve like one storefronts for investors, dealing with registrations, taxation, and other aspects of establishing businesses in the country.
5. Transformation to the digital age: By 2025, 475 million individuals in Sub-Saharan Africa will be using mobile internet services, according to the GSMA. In terms of mobile uptake, Africa is in the forefront. Mobile money networks, which began in East Africa, gave unbanked metropolitan and rural inhabitants access to the global economy. In Africa, the usage of technology is on the rise. Olam, for example, uses mobile to connect with new African suppliers and farmers, while  Pharma uses technology to eliminate inefficiencies and price swings that keep prescription medications from reaching ill patients.

WRITTEN BY:

John Sele Philip

Founder/Director General, SWOP

https://swopafrica.com