CAPE-TOWN, South-Africa, It
is no secret that Africa is on the rise and increasingly offering
lucrative opportunities to local businesses due to the continent’s
steady economic growth, increased disposable income and high consumer
confidence.
Charles Brewer, Managing Director of DHL Express Sub-Saharan Africa,
says that one particular sector which has seen significant growth in
Africa is agribusiness, which entails the full value chain from
agricultural production/farming through secondary processing,
distribution and retailing to the end user/consumer (farm-to-fork
concept).
“The retail sector is booming in Africa, as is the rapid
growth of populations and the African middle class. As a result of this
expansion, there is a greater availability of and demand for good
quality agricultural produce and processed food products than ever
before.”
He
points to the recent report by World Bank - Growing Africa: Unlocking
the Potential of Agribusiness – which revealed that Africa’s farmers and
agribusinesses could create a trillion-dollar food market by 2030 – a
three-fold increase from the current size of the market which is
estimated to be worth $313 billion.
“This
expected growth highlights the growing market and many opportunities
for South African agribusiness and related value chain role players to
expand into Africa,” says Brewer.
According
to Hennie van der Merwe, CEO of the Agribusiness Development
Corporation (ADC), based in South Africa, Africa provides a new market
for agribusiness firms.
“Given
its increased spending power, demand for goods and untapped land
resources, Africa is currently experiencing a revival in terms of its
focus on agribusiness, not only to increase food self-sufficiency, but
also to create jobs and economic activity, specifically in rural areas,”
says van der Merwe.
“In
the current climate, Africa is increasingly offering greater growth
forecasts,” he notes. However, he explains that while Africa is
well-endowed with resources, it often lacks much of the necessary
expertise to unlock the commercial potential of its agriculture
resources, whereas South Africa is well regarded for its expertise in
commercial farming and agribusiness.
“One
of the major limitations on agribusiness development in Africa is a
human capacity and human skills constraint. The ability and experience
to develop and manage commercial farming and agribusiness ventures are
largely lacking in the African environment and that major technology
transfer and capacity building would be necessary in this regard.”
Van
der Merwe says this is where the opportunity lies for local businesses
and farmers to expand beyond their borders and offer expertise in
neighbouring countries.
Van
der Merwe adds that it is vital to have partnerships in place before
venturing into projects in Africa. “Partnerships with a local business
or association in the specific country are necessary as business owners
need to be provided with assistance, guidance and sometimes protection
when in the area. It is also essential/indispensable to ensure that all
the building blocks for working value chains are in place to ensure and
support successful operation. A local partnership will also assist with
analysing the market carefully to evaluate what the real market needs,
requirements and opportunities are.”
“The
market in Africa is there and ready, but the question is how local
businesses create a direct link to service the market needs,” concludes
Brewer.
Distributed by APO (African Press Organization) on behalf of Deutsche Post DHL.
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