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A logistics survey has revealed that South Africa, Nigeria, Kenya and Ghana are the most promising markets in sub-Saharan Africa, despite having to face a host of challenges
The 2016 Agility Emerging Markets Logistics Index has revealed that while the four countries have potential, power outages, lack of infrastructure and corruption pose a growth risk to these economies.
There were 1,100 respondents to the survey – only 21.2 per cent said their companies had operations in Africa, 12.7 per cent were planning to enter the market but disappointingly, 43 per cent said they have no plans to begin operations in Africa.
“The results show a serious disconnect between the perception of the market and actual opportunities. These are some of the world’s fastest-growing economies. Africa’s requirement for logistics services and supply chain expertise is huge and growing every day. At the same time, many of the companies that need logistics to enter the market don’t know how to get started in Africa or aren’t willing to take the risk,” said Agility Africa CEO Geoffrey White.
“The market is open for first movers who can navigate risk and nurture African talent. The opportunity is for those seeking to build long-term, sustainable businesses that bring world-class practices and adapt to local conditions.”
In sub-Saharan Africa, South Africa is ranked at 16th place and Nigeria at 17th place. South Africa has Africa’s most advanced logistics industry and transport infrastructure, but its economy is getting affected by chronic power shortages, slumping commodity prices, a plunging currency and labour unrest, said the Index.
Nigeria climbed 10 spots in the 2016 Index, tying with Egypt at 22nd spot for the biggest gain by any country in the seven years since the Index was first published. However, its economy is heavily reliant on oil and is now feeling the impact of low energy prices.