"But being right, even morally right, isn't everything. It is also important to be competent, to be consistent, and to be knowledgeable. It's important for your soldiers and diplomats to speak the language of the people you want to influence. It's important to understand the ethnic and tribal divisions of the place you hope to assist."
Sunday, December 26, 2010
By The Fletcher Africa Business Group and The Corporate Council on Africa
Sub-Saharan Africa’s gross domestic product (GDP) has been growing at a consistent rate for over a decade, and is expected to reach beyond 5% in the coming years. This sustained expansion, absent from most of Africa since the 1970s, has raised the continent’s profile as an investment destination. The struggle, however, has been for would-be investors to find the right markets beyond Nigeria and South Africa, which tend to top most lists by virtue of their size. With the exception of those with mineral endowments, most African nations simply cannot offer sufficiently large market size to be of interest to multinational corporations (MNCs).Independently, the member nations of the East African Community (EAC) represent mid-sized and small economies, even by African standards. But this dynamic is changed when we consider a combined EAC population of 126 million and total GDP of $80 billion. These numbers make the EAC a fast growing mid-sized market by global standards, with a GDP roughly equivalent to Vietnam’s.The question for investors is: can we consider the EAC to be one market? The trends are certainly moving in the right direction, and those who champion the EAC as an exciting market are justified in their enthusiasm. But investors should also be mindful of the challenges that remain...