BY: Patson Chapeyama
In this article, I would like to unpack vast business opportunities in Africa focusing on Africa’s key economic drivers such as Mining, Agriculture, Infrastructure, Energy, Transport and Logistics, Tourism and Water Sanitation. I would like to take this space to drill down into greater detail. It is undeniable that Africa is endowed with remarkable business opportunities. I sturdily believe that the information that I will share with you in the following paragraphs will baffle and puzzle you. I am that one soul who believes Africa is poised for economic growth if entrepreneurs take their stand to tap into massive business opportunities this continent has to offer. To begin with, let us look at Africa demographic shifts. The African population is estimated at 1.2 billion people and 40% are under the age of 15. Africa population is expected to double to 2.4 billion by 2050. 48% of Africans are living in dire poverty, living below $2 a day. Already the above statistics presents a great opportunity for business. As the population doubles that means the demand for goods and services will increase. However, this could be a topic for another day. Let’s take a closer look at the following key economic drivers and enormous opportunities that lie in them:
Africa has 30 % of world mineral resources and is estimated to have more than 60 different minerals. 87.9 % of global Platinum Reserves, 84% of Chromium, 60% Diamonds, 40% of gold, 17% of Uranium and 49% of cobalt . With this great endowment of mineral resources presents vast business opportunities in the mining sector. It is also believed that some other mineral deposits are not yet discovered. China imports mineral resources worth US 200 billion annually from Africa.
Africa has vast arable land for farming. The sector contribute only about 15% to total Africa Gross Domestic Product (GDP). Total Africa GDP is 2.2 trillion. 70% of the workforce of Africa are in this sector. Africa imports more than 29 billion worth of food annually. This presents a massive business opportunity in this sector.
The Africa Development Bank has indicated that 630 million people in Sub-Saharan Africa have no access to electricity. Africa consumption is 423 terawatt hours per annum which is less than Brazil which consumes 426 terrawatt hours. More than 40 % of electricity in Africa is generated by South Africa. Africa electric generation is less than New York City. This offers a US $800 Billion investment opportunity. Zimbabwe is experiencing a power deficit, with daily electricity of demand of 2,200 Megawatt (MW) against an installed capacity of 1,100MW and the government has encouraged independent private producers (IPPs) to step in to cover the shortfall. The above statistics illustrates the bigger business opportunity in this sector.
Tourism is one of key sectors that presents massive business opportunities. It is also one of the fastest growing sectors in the continent. It is estimated that about 4 million jobs could be created by 2021. In 2011 it was reported that only 23 hotels were operating in Sub- Saharan Africa. It is also reported that Africa only have 5% of world’s scheduled airlines services. The above statistics clearly indicate great opportunities in the continent.
It is estimated that road networks covers 204 kilometers per 1000 square kilometers. About 80% deficit in terms road infrastructure development. This also shows massive business opportunities in the transport sector.
Water and Sanitation
Only 39 % of people in Africa have access to clean water. 61% of the people have no access to safe drinking water. This is another sector which presents great opportunities for business development.
Patson Chapeyama is a cutting edge Writer, Speaker and Business start-up consultant. He is the author of bestselling success books and columnist in local and international news platforms such as Newsday (Zimbabwe) and Making Finance for Africa (African Development Bank Ivory Coast) . He is also an editor for a number of local magazines and books. He has been involved in several local and International business startup projects. For any engagement can be reached on, +263733551626/ firstname.lastname@example.org.