September 28, 2018
Video pills /
Posted by NCID
Video Pills: 

Sub-Saharan Africa has not usually been considered a region of investment opportunities, but this is changing thanks to public and private initiatives.

The private sector can help "either creating the market or landing on it", said International Finance Corporation principal, Carlos Reyes, in his session Outlining the opportunity for private sector investment in Sub-Saharan Africa, organized on September 20 by the Navarra Center for International Development.

Talking about Sub-Saharan Africa means most of the times talking about the problems that the media shows: political and social instability, war, starvation, etc. According to Reyes, although those problems exist, the media has created a narrative and some myths about what the region really is. That narrative forgets economic, political and social characteristics and advances that should motivate investment in different sectors that could promote development.

Africa, for example, is the continent that will grow the most in terms of population and percentage of working age population (almost 225 million by 250 and 40% by 2100, respectively), and meanwhile, Sub-Saharan Africa is living its most recent urbanization process. Through investment, both situations, such as the growing middle class in the region, could be oriented to socioeconomic development. Also, against the stereotype of permanent volatility, there are countries in both anglophone and francophone markets that have strengthened their democracies and the business environment, like South Africa, Nigeria or Senegal.

On the other hand, there are difficulties, as Reyes admits. Populism, that could affect the private sector; geography, sometimes problematic; lack of infrastructure,; stable and reliable power generation and transportation costs are the main obstacles for investment that he points out. All the above are challenges for a region that is a potential powerhouse of goods and services.

Considering both opportunities and obstacles, Reyes argued there are  optimum sectors for investment in Sub-Saharan Africa, such as telecommunications and information services, due to the general increase in its use. Other sectors include the electricity sector,  due to the increase in the need for power; consumer products and services, because of an increasing demand from the buoyant middle class population, and financial services, as an example of a developing market that could help a structural transformation in the region.

Recent Posts
Archives