Unreliable as they might come in Africa, statistics all indicate that the continent is ready to take off economically. Six out of the 10 fastest growing economies over the past decade were African – a fact that has too easily been overlooked in the shadow of much more publicized growth numbers in China and India. Foreign direct investment into Africa has grown more than three-fold over the past 10 years to US$ 46 billion in 2012. And trade with China, where I am writing this, has exploded from US$ 11 billion to US$ 166 billion over the same time.
With China now by far the biggest single investor in Africa, the old-fashioned vision of Europe, the Middle East and Africa as a market unit is destined to be relegated to history. The new organizational set-up of multinational businesses looks much more closely aligned along a combination of Asia and Africa, with the Middle East a crucial logistics and transport hub connecting both continents. The combined population of that region accounts for 5.5 out of 7.2 billion people in the world.
This new world order is nothing new. It is, in fact, a reenactment of ancient trade routes connecting China and India to the Middle East and Europe in the North and China and Africa in the South. Silk was traded along those routes as long ago as 200 years before the Common Era. This was followed by incense and spices during the great Age of Discovery.
A recent report by HSBC speaks of the new Southern Silk Road connecting Asia, the Middle East and Africa, and further across the Atlantic Ocean to Latin America, with projections of tenfold growth of trade and investment.
Africa today has a real opportunity that needs to be carefully nurtured and exploited to drive further growth and development.
Author: Kevin Taylor, President, BT Asia, Middle East and Africa, and President, Global Logistics.
Image: Traffic is seen on a bridge in Lagos REUTERS/Akintunde Akinleye