Has Africa reached a ‘tipping point’?

This was a phrase coined at the Africa Investment and Finance Conference on 22nd February 2008. The consensus of the optimistic audience was that Africa has moved on from being the destination of only high-risk investments, to a burgeoning market where the investment rewards are waiting to be reaped. The African Development Bank proudly asserted that now only 3% of their investments in Africa are unsuccessful. And in a time of extreme volatility in the markets of the developed western world, Africa offers a promising alternative destination for new capital.

Companies who ten years ago took a long-term view of investing in Africa are now reaping the benefits. Celtel for example has experienced extraordinary growth in the mobile telephony market, and has recently been involved in setting up Satya Capital to invest in other business opportunities on the continent.

And it is not just one sector that is showing high potential, but expectations of growth are predicted in the hotel industry, the power sector, infrastructure and construction, mining and financial services. It is not just big business either – SMEs growth is also ready to explode.

Amidst all this possibility, what about the bouts of political instability that we cannot deny occur? Kenya being the most recent example which is currently experiencing an economic downturn as a consequence of the violence. The delegates I enquired of at the conference all concurred – it was anticipated to only be a short-term fall (with today's news a sign of real hope).

The future for Africa is considered bright and it is the long-term view that the conference delegates considered all important for the continent.

Afrika! Afrika!

Apart from being one of the most spectacular shows I have ever seen, Afrika! Afrika! is also hugely important. With over 100 outstandingly talended performers from 17 countries, this André Heller show presents Africa in all its vibrancy - a welcome antidote to the overly-pessimistic nature of much of the reporting on the continent. Businesses - including those in Business Action for Africa - know that Africa is a continent of enormous diversity and opportunity, and the recent positive data backs up this view. Currently at the O2 in London, Afrika! Afrika! is a remarkable showcase of a great continent, and I recommend you join the 1.5 million people who have already seen it as soon as you can.

Doing business in Africa: the path to Africa’s prosperity

Every economy around the world has been lifted through the energy of its entrepreneurs. Every family around the world sees getting a job or growing their business as the single most important route to a better life. This is no different in Africa.

That is why I was delighted to be involved with last week’s European launch of the Doing Business Report 2008 - an annual survey of life for enterprises around the world, produced by the International Finance Corporation and the World Bank.

And there is good news from Africa. Ghana and Kenya both rank among the top 10 reformers worldwide, and Mauritius tops the rankings in Africa on the ease of doing business. The Finance Ministers from Ghana and Kenya, and the Finance Secretary from Mauritius, received World Bank awards at the London event that was hosted by Unilever, Business Action for Africa, the World Bank, the International Finance Corporation, and the UK's Department for International Development.


According to the report, Mauritius ranks eighth globally for ease of starting a business, South Africa is in the top ten for strength of investor protections, and Botswana ranks 14th on ease of paying taxes. If a country were to copy the best practices from across the Sub-Saharan region, it would rank eighth on the ease of doing business - ahead of Japan, Germany and France.

Helping entrepreneurs grow is dramatically more powerful and sustainable as a route to ending poverty, than aid alone. That is why the speech by DFID Minister, Baroness Shriti Vadera, was so refreshing:

“I am concerned that sometimes we lose sight of the simple fact that, without growth, sustainable human development is a largely theoretical proposition. We also sometimes lose sight of the fact that the purpose of aid is to no longer require it.”

This signals an important and welcome shift of emphasis, and better reflects what is needed to tackle the scourge of poverty across the African continent.