The best time for American companies to invest in Africa is now. With
African Continental Free Trade Area commencing as of January 1 st , 2021.
The agreement will create the largest and single free trade market. The
pact connects 1.3 billion people across 55 countries with a combined gross
domestic product (GDP) valued at US$3.4 trillion.
The scope of AfCFTA is large. The agreement will reduce tariffs among
member countries and cover policy areas such as trade facilitation and
services, as well as regulatory measures such as sanitary standards and
technical barriers to trade. Full implementation of AfCFTA would reshape
markets and economies across the region and boost output in the services,
manufacturing and natural resources sectors.
New and emerging market place with a booming in Demography. 2.4 billion Of population by 2050, and 4.39 billion by 2100 to claim over 1/3 of the world’s population.
Africa hosts 60% of the world’s uncultivated arable land. Yet most farms
occupy less than 2 hectares and only responsible for 10% of the world
The gap is huge. (For example, The DR Congo has one of the lowest rates
of electrification in the world with only 9%. Installed Capacity: 2,677 MW.
While this country has a potential to install up to 100,000 MW of
Africa Continent’s infrastructure needs amount between $130 to 170 billion a year according to “African Development Bank”.
D. Abundance in raw materials.
- 90% of the world’s platinum and cobalt.
- 50% of the world’s gold supply.
- 35% of the world’s uranium.
- 2/3 of the world’s manganese.
- 75% of the world’s coltan, an important mineral used in electronic
devices, including computer and cellphones.
In 2017, the Democratic Republic of the Congo alone accounted for 58% of the world’s cobalt (used in electronics production) while South Africa
accounted for 69.6 % of the world’s platinum production in 2016 (used for
catalytic converters and in other goods).
E. Work force
12 Million young people join Africa labor market force every year. However, Nigeria has more than 55 per cent of young people unemployed or underemployed.
The hourly wage in Africa is less than 50 cents per hour. (For example; its $0.27 in Mozambique, $0.57 in Nigeria and $1.62 in Morocco).
G. Trade between continents
70% Africa-Europe, 51% Africa-Asia and 16% between African countries) that why African countries wants to increase the number of trade throughout “African Continental Free Trade Area and Free Movement of People”.
As every investor knows, where there is demand, there is opportunity.