Opportunities for export and business in Africa
Africa has opened itself to the world and it would be a wise business decision to invest in the countless opportunities the continent has to offer. Find out what Africa has to offer you but more importantly, where in Africa should you start your ventures.
Only a few countries within this economic region have shown prominent growth so far i.e. Cote d’Ivoire, Ghana, Nigeria, and Senegal. These areas have become large trading centers, which are slowly gaining a reputation within the industry. These countries have made it their focus to strengthening trading practices through international and intra-regional means.
The trade economy in Southern Africa and neighboring regions have greatly improved. This is mainly because of its tariff policies and its transport network. These factors greatly influence the trading business in Southern Africa.
The country of South Africa is currently a leading example for the other countries in the region. South Africa has done its fellow regional countries good by setting itself as an example in how it carries itself in the trade economy.
East Africa is also doing great in the trading economy. This might be due to its large population, growing regional markets, and a strong border administration.
East Africa has become a center for trade. This claim is better explained by countries like Ethiopia, Kenya, and the United Republic of Tanzania, which have become prominent in trading due to its unique methods in facilitating business across regions.
Central Africa holds the most populated countries and/or territories and these have shown the highest economic growth. Trading opportunities and GDP growth have improved in places such as Gabon, Cameron, Sao Tome and Principe, Democratic Republic of the Congo and Angola among others.
The Central African region along with West Africa is growing and yet has untapped potential. It is steadily becoming more attractive to foreign markets and investors.
African trade has experienced a shift in trade flows from the Western world and the Asian countries. Imports from Asia have increased while European trade still retains a fair share in the market.
Manufactured goods have declined slightly but this is due to the increase in the value of fuel products. However, the fall in global oil prices might soon resolve this situation.
Growth potential for international countries seems bright due to increased consumer spending. The rise in shops, malls, and supermarkets will encourage consumers to purchase more in the light of additional income and wider purchase options.
Trade agreements and cooperation
Africa has several agreements associated with the trade. These agreements were mainly initiated by other countries in order to secure the continent’s natural resources, take advantage of the low-cost labor force, and include the continent in the fast-growing global consumer market.
International trade agreements
The European Commission (EC) has finalized agreements as partners with Africa’s three main trade blocs. Other countries have individual trade agreements with individual countries or blocks.
Regional integration has supported the growth of international and intra-regional trade and investment. Some countries and economic communities are very advanced in trade-related integration plans. These countries have also benefitted from reduced tariff and nontariff barriers to international and intra-regional trade.
Africa’s major trade and economic zones
Africa is divided into five economic zones each with a focus on several goals in strengthening their individual regional economy.
1) The Southern African Development Community (SADC):
The primary aim of the SADC is economic development, lifting poverty, improving the standard of living for its people, peace, security and growth, and providing support for the socially disadvantaged through Regional Integration.
The SADC member states include:
- The Democratic Republic of Congo
- South Africa
2) The East African Community (EAC):
The EAC is considered to be one of most rapidly growing regional blocs in the world. By deepening cooperation among its member states, EAC works towards the mutual benefit of the states in this region in the areas of political, economic and social reforms.
These 6 EAC states include:
- South Sudan
3) Common Market for Eastern and Southern Africa (COMESA):
The Common market for Eastern and Southern Africa was formerly known as the Preferential Trade Area. COMESA is an amalgamation of free independent sovereign states that are in mutual agreement to develop their natural and human resources for the good of all their people. The COMESA has a wide range of objectives which mainly centre around promoting peace and security in the which necessarily include in the region. Economic prosperity through regional integration sums up COMESA’s mission.
Its member states include:
- The Union of Comoros
- Congo DRC
4) Economic Community of West African States (ECOWAS):
To encapsulate the objectives of ECOWAS, it would be best to look at the ECOWAS’ VISION for 2020 which is aimed at setting distinct goals in the direction that significantly raises the standard of living of the people of this region via conscious and participatory programmes towards a hope-filled future for West Africa.
The states that make up this economic community include:
- Burkina Faso
- Cabo Verde
- Cote D’Ivoire
- The Gambia
- Sierra Leone
5) Central African Economic and Monetary Community (CEMAC)
The main idea behind CEMAC is to facilitate trade among its member states. For this, they created the Customs Union that harmonized taxes and duties and established a common external tariff. The results of this were numerous infrastructural developments, along with the harmonisation of national fiscal and customs systems. It also managed to encourage the individual state level political leaders to meet and work together towards mutual betterment.
CEMAC states include:
- The Central African Republic
- The Republic of Congo
- Equatorial Guinea
Right now, the continent is working hard to develop transport and energy infrastructure across the regions. Many states are also planning to improve customs clearance procedures, ensure better government departments, and facilitate greater cooperation among regions.
Opportunities can be seen in the growing population, in the rapid economic growth, rising household incomes, urbanisation and an improved access to finance. Devise your business strategy to take advantage of the many opportunities that Africa presents and experience the dynamism of a developing economy.