The continent of Africa is home to seven of the fastest-growing economies in the world. Seen as the “final frontier” for investors, Europe and China have pioneered these investments. Consequently, China has become Africa’s number one trading partner and job creator. American businesses, on the other hand, have been slow to invest in Africa and lag behind. As Josh Becker, the CEO of Impele Consulting Group, said, “We are seeing tremendous growth in interest in Africa [from the U.S.], but not the same growth in action”.
Africa is in a position that many envy. Different from the rest of the world, Africa is a frontier with the capability to build on lessons learned from other countries. Without the fuss of resistance and a lengthy trial-and-error period, they can establish institutions and infrastructure with the most effective methods that have been tested by others.
Africa is a clean slate. It has the capacity to lead sustainability continent-wide without having to change an existing framework. American businesses specializing in these areas have the opportunity to invest in Africa to assist in its development.
Much of Africa’s landmass has been largely untouched agriculturally and has the potential to become a big name in world food production, and possibly a sustainable one.
Much of sub-Saharan Africa lacks well-built airports, railroads and highways. Africa can implement efficient, modern and sustainable transportation methods that other countries wish they could execute on a mass-scale. Once transportation hubs are built, markets will be connected and Africa can expect impressive gains in production.
Sub-Saharan Africa faces repetitive power outages, leaving households and businesses without electricity. This curbs production and ultimately threatens economic growth. If this problem is fixed, a higher standard of living and economic gains will result.
- Mobile Connectivity
Currently, Africa is the leader in mobile adoption. Cell phones have linked African countries to each other and with the outside world. In a 2014 pilot program in Ethiopia, a telephone hotline was established, allowing farmers to discuss agricultural techniques with agronomists. In the first couple of months of the program, 30 million calls were made. Communication flow is so vital in production, and investors can encourage this elsewhere by building telephone lines and bringing mobile companies to Africa.
The World Bank predicts that Africa has just started growing, and will only flourish more with investment. However, current Chinese investment is damaging and will eventually stunt Africa’s growth. The George W. Bush Presidential Institute stated that China does not help Africa fight corruption, encourage gender inclusion, promote sustainability or connect its regions. The United States needs to step in and be the source of positive encouragement Africa needs. By competing with China, American businesses can ensure they will benefit from investment and Africa will exceed its potential.
In 2017, President Trump expressed desires to enhance trade and partnership with Africa. One can hope these desires will be implemented and inspire businesses to invest in Africa. If so, vast economic advancements await Africa and lucky American businesses.
– Mary McCarthy