Unlocking value to grow beyond the possible
EY's first Strategic Growth Forum (SGF) in Africa attracted more than 300 attendees including CEOs, leading entrepreneurs, investors and government officials all with a passion forunlocking value in Africa to ensure she achieves her potential.
The themes and purpose of the forum were amongst others, to connect those with a passion for unlocking value in Africa, and for companies to network and capitalise on the growth opportunities Africa has to offer.
A clear theme and strong message running throughout the forum was that there is a new story emerging about Africa; a story of growth, progress, potential and profitability. We heard that 7 of the 10 fastest growing economies in the world over the next 5 years will be African; we heard of the successes and optimism of a range of business leaders from Ecobank, Diageo, DHL, Standard Bank, Tullow Oil, Ford, Chevron, BAT, Equity Bank, Engen, Notore, Educomp, IBM, Transnet, among various others; we heard from leaders in government about concrete steps being taken to create environments conducive to investment and doing business.
However, despite growth and progress, a perception gap continues to exist between the negative images of poverty, corruption, conflict etc and the emerging African growth story. It is clear that all those with a passion for Africa - government, business, development agencies, and broader civil society - need to start talking with a single voice; celebrating Africa's successes, but equally not shying away from the challenges that still need to be
|5 key issues affecting accelerated growth, development and investment attractiveness were consistently raised during the course of SGF |
|1 ||Perceptions |
Perceptions that Africa is inherently corrupt remain a key barrier to growing investment into the continent. Sanusi L. Sanusi, the Governor of the Central Bank of Nigeria, described to us how endemic corruption in the financial sector in that country has been rooted out and the system transformed. What other government anywhere else in the world criminally prosecuted CEOs of leading banks in the wake of the global economic crisis? While corruption remains a key challenge across many countries, African leaders like Mr Sanusi are tackling the challenge head on.
|2 ||Regional integration |
Regional integration, and, in the shorter term, breaking down the barriers to intra-African trade and driving towards greater regulatory harmonisation will create larger markers and significantly boost economic growth and development. South African Deputy President, Kgalema Motlanthe, spoke of his government's commitment to the implementation of a tripartite Free Trade Area, combining 26 countries and creating a market of up to 600m people (rivalled only by China and India).
|3 ||Africa's infrastructure deficit |
There is no doubt Africa's infrastructure deficit is one of the greatest factors of underdevelopment and a constraint to doing business in Africa. A study of infrastructure across 24 Sub-Saharan countries by the African Development Bank estimates US$93 billion will be needed annually over the next decade to develop the well functioning infrastructure required for Africa to realise its true economic potential. Sourcing the required level of financing provides both challenge and opportunity. The US$93 billion will not be funded by government loan finance alone. Donor funds, the private sector, pension funds and private equity players all have a role to play.
|4 ||Unlocking the potential of Africa's human capital |
There is a much to be done to unlock the potential of Africa's human capital. Education, skills development, job creation and poverty reduction remain critical long term challenges. But there are also shorter term opportunities, like reconnecting the diaspora, removing barriers to the mobility of African professional talent across the continent, and prioritising investment in education and vocational upskilling.
|5 ||The relationship between government and business |
|The relationship between government and business is not always as engaging and productive as it could and should be. Business should be a key partner in developing solutions to these challenges, and, ultimately, to enabling sustainable economic and social development in Africa, through investing in critical capital projects, paying taxes, job creation, skills and enterprise development, technology transfer, corporate social investment, and so on. Many African governments are making good progress towards creating more business friendly environments, but there is still much scope to build on and accelerate this process, and to ensure sustainable win-win relationships for all key stakeholders. |
To download a soft copy of our SGF document, click here.