An Inflexion Point for African Growth?

“The question for executives at consumer packaged goods companies is no longer whether their firms should enter the region, but where and how,” A.T. Kearney, the management consultancy, wrote in recent research that found west African subsidiaries achieving nearly twice the profit margins of their parent groups. Other research amassing at investment banks and international financial institutions highlights the potential for Africa – or at least parts of it – to become a significant driver of global economic expansion in coming years.
No one sensible believes that the road will be smooth for all of sub-Saharan Africa. But in almost every sector demand outstrips supply. “The reality is Africa is probably 30 years behind China and 20 years behind India on the developmental curve in that regard, so I think the Chinese and Indians will start to look at parts of Africa as potential sites for low-cost manufacturing and outsourcing and things like that,” says Michael Lalor of Ernst & Young.