Investing in Africa

Crystal Orderson reports on Africa's growing momentum in attracting investment.

Africa's youthful population, the African Continental Free Trade Area, and sectors like renewables and manufacturing gaining traction, are all indicators that the continent presents a wealth of potential for investors.

Africa's demographic advantage:
According to Stats SA, Africa is projected to have a population of approximately 2.4 billion by 2050, with over 75% of its population being under the age of 35. This youth dividend positions Africa as a significant market for investment and economic growth. While aging populations pose challenges in other regions globally, Africa's youthful demographic offers an opportunity for sustainable development and innovation.

The African Continental Free Trade Area (AfCFTA):

The AfCFTA has emerged as a catalyst for significant investment in Africa, with 44 countries already having signed up for the agreement. The AfCFTA, representing a combined estimated GDP of about US$624 billion, promotes intra-African trade, manufacturing opportunities and consumer spending. It provides a crucial platform for businesses to tap into regional and domestic markets, fostering economic integration and growth across the continent.

“The reality is that we do have the African continental free trade area which makes us the largest free trade zone in the world.” – Crystal Orderson

Renewable energy and manufacturing:

The renewable energy sector's vast potential in Africa is not to be underestimated. The continent boasts the world's largest renewable energy resources, positioning it as a potential leader in clean energy development.

Manufacturing has also emerged as a promising investment avenue. Ardagh Glass, a market leader in glass production in South Africa serves a broad range of leading international, regional and domestic customers, mainly in the beer, wine, spirits, food and non-alcoholic beverage sectors. It recently completed the refinancing, upsizing and syndication of its senior debt facilities worth R9.2 billion, with RMB acting as the co-ordinator and mandated lead arranger on the deal.

“This investment from a global leading manufacturer demonstrates international confidence in South Africa and Africa as a whole which will help to enable sustainable job creation and economic growth.” – John Chowthee, RMB

Nigeria is a market with abundant raw materials and immense growth potential. It currently imports glass and glassware worth approximately US$51million. The presence of untapped markets, such as the beverage industry and the nostalgia-inducing small glass bottles, present attractive prospects for investors.

Despite the challenges faced, Nigeria's sizable population and consumer preferences make it an intriguing investment destination.

“Nigeria is one of the most endowed countries in terms of availability of glass raw material – an  entity that is seeing that gap in the market. And here we have a bank that is saying: ‘We're going to help you to structure and give you the tools to be able to deal in these key markets’.” – Crystal Orderson