The African continent is going through a phase of transformative growth in terms of its economic development at the present time, with key sectors of the economy experiencing rapid improvement and fast acceleration. There are a number of opportunities that have come together to unlock this transformative growth, and these all feed into the continent’s upward economic progression. Having been recognized in many African countries for his charitable and philanthropic work, Alessandro Bazzoni has a vested interest in Africa’s potential for sustained economic growth. Here, he takes a closer look at these long-term trends.
A rapidly urbanising and growing population
Currently, Africa has a population of about 1.2 billion, and this figure has been estimated to reach around 1.7 billion within the next decade. Over 80% of this population growth will almost certainly take place in cities, and this makes Africa the world’s most rapidly urbanising region. Furthermore, Bazzoni points out that incomes are also rising across much of Africa, and this is opening up new opportunities within the consumer marketplace for businesses. By 2030, Bazzoni predicts that African businesses and consumers will be spending over $6 trillion annually – an increase of $2 billion from 2015. This trend for upward growth is fostering the growth of markets in sectors where the population’s needs are currently unmet, including beverages, food, financial services, education, healthcare, and pharmaceuticals.
An industrialising continent
An industrial revolution in Africa is taking place, with manufacturers ramping up their production of a wide range of goods. Bazzoni calculates that industries in Africa have the chance of doubling their production within the next ten years with around 75% of that growth coming from manufacturing which will substitute for imports and help to meet the increased local demand. Manufacturing of exports is also likely to occur, and Bazzoni believes that Africa will become the next world manufacturing centre that will overtake China as the lowest-cost region. Sectors such as agro-industry, tourism and ICT services will be instrumental in this shift.
Closure of the infrastructure gap
Bazzoni states that poor infrastructure has long been a key impediment to growth and investment in Africa. As a former high-level executive within the sustainable energy industry, he is well-placed to understand the impact that the lack of access to the grid has on around 600 million Africans. However, thanks to investment and also the sustainable energy revolution, progress is now being made and more entrepreneurs and investors are coming forward to solve the infrastructure challenges that face the continent as a whole.
Innovations that unleash resource wealth
It has been known for centuries that Africa is abundant in both mineral and agricultural resources. However, until quite recently, the continent has found it difficult to turn those resources into long- term economic development and shared wealth. Now, though, new investments and innovations are promising the alter that picture, creating interesting business opportunities for growth. Bazzoni’s own field of interest – sustainable energy – is a valuable untapped resource in this region, with the potential to take advantage of solar, hydro and wind energy to help generate sufficient power for the population’s needs, thus taking millions of Africans out of energy poverty.
Increased access to mobile and digital services
It goes without saying that having access to mobile and digital services is vital if any country is to progress in today’s modern age. Until recently, the African continent was behind in this respect. However, over the past decade, huge strides have been made forward, with Sub-Saharan Africa seeing huge numbers of broadband connections and an enormous increase in mobile data traffic continent-wide. Mobile money accounts are extremely prevalent in Africa, with over 120 million being owned by the continent’s population which equates to more than half of the world’s total number. This has helped those who previously lacked access to traditional banks progress and move forward, with companies seeing improved productivity, faster transactions and access to wider worldwide markets. It has been predicted that improvements to access to mobile and digital services will add as much as $300 billion to Africa’s GDP within the next 5 years.
A final word from Bazzoni about Africa’s economic growth
Although the African continent still faces challenges when it comes to improving its economic growth, it’s clear that African countries are seizing the above opportunities and taking advantage of them to propel their growth forward. As a younger, growing workforce rapidly upskills, the opportunities are increasing for those who are keen to invest and innovate in this region. By tapping into the region’s unused sustainable energy resources, Bazzoni believes that African nations can spur their economic growth onwards more rapidly and more effectively, enabling them to become more productive, more successful and, ultimately, more profitable within the next couple of decades.
