The Cotswolds has long enjoyed strong economic links with Africa. From investment giant Investec linking London to Johannesburg via Cheltenham through to projects like Minchinhampton’s twinning with Nkokoto in Tanzania – our relationship with the world’s second largest continent is well established. But African economies are growing fast and a different relationship with the UK is evolving.
Rapid innovation in mobile technology, agriculture and finance are helping people think differently about what a future relationship with Africa might become. Brits are helping in new ways and being rewarded differently. Rikard Svendsen, Chairman of Enterprise Africa, promotes UK business across the continent. He explained…
“China has intensified its investment across the African continent contributing to a global capital investment of US$128B, up 136% on previous year. Not wanting to be left behind, the UK has taken a fresh look at the worlds’ fastest growing economy. They have realisedthat the Africa of today, no longer wants aid or charity but instead craves highly technical and innovative solutions to provide basic services to its 1.1 billion people. Companies specialising in renewable energy, telecommunications, financial services, health, education and agriculture have seen the potential to not only make millions in profit but also improve the lives of millions of African people – all at the same time. And it’s this ‘win-win’ that makes investing in Africa so attractive to UK companies.”
Agricultural innovation in many African nations is world-beating. New initiatives involving Cotswolds companies are helping to foster fruitful links for British business. A key part of the UK government’s Agri-tech strategy since 2013 has been to help Africa, by linking together the best UK, Chinese and African research and private sector organisations. More knowledge and expertise is now being shared between Africa and the UK than ever before – helping UK Agri-tech flourish in concert with Africa rather than in competition against it.
Another reason for economic optimism is the explosion of the mobile industry across Africa. Over 600 million people – about 56% of the population – are now likely to own a mobile phone, with some researchers estimating the figure could hit 80% in the next few years. To put things into perspective the number was just 1% in the year 2000. There are now more than 35 mobile network operators in Africa busily extending their base station networks to improve coverage. British business is waking up to the opportunities this presents. Whether it’s farmers accessing local market prices for their produce or doctors using medical data – mobile innovation is transforming the way people work. Mobile payments in Africa have similarly seen dramatic growth. Vodafone and Safaricom’s M-Pesa mobile payments system already handles £7 billion worth of payments in Africa each year.
Africa is home to 6 of the top10 fastest-growing countries on earth but a big challenge facing many African countries is how to deal with national debt. Many governments struggle not just to repay debt but crucially they often lack expertise in how to negotiate and re-structure complex contracts. The economic climate this creates can then stifle both business growth and customer sentiment. One key way UK firms are helping is by providing direct support to governments. This year a number of large UK based law firms will be at the forefront of providing economic support to the government of many African countries. With the fall in global commodity prices, a number of oil and metal exporting nations like Angola, Nigeria, South Africa and Zambia are only forecasting a modest recovery from the global financial crisis. In many situations, banks have agreed to renegotiate contracts to help make debt repayments easier but they cannot always be relied on to show the foresight and flexibility required to keep pace. Law firms are increasingly getting involved and providing the expertise needed to secure favourable payment terms. Work like this helps sustain healthy conditions for business and allows investment to thrive while economies develop.
Trade worth £10 billion now flows between the UK and South Africa every year while financial powerhouses such as Old Mutual and Investec provide access to an array of investments spanning both markets. This means South Africa remains the most important gateway to the continent for entrepreneurs and investors alike. However, things are changing fast and new opportunities are emerging every day across another 53 African countries where people brimming with talent and innovation are ready to do business