What’s the best way to make sense of investing in Africa?

The first step is to consider both cultural considerations and potential pitfalls.

Linguistic, ethnic and religious diversity makes cultural changes across the continent extreme. Demonstrating passion and interest in the local culture and its nuances is essential, not least to generate trust, but to build loyalty takes time.

Appreciate that Africa is not just a homogeneous market, but 54 countries with 2,000 languages, 521 of which are in Nigeria alone.

Africa’s current total population of 1.2 billion people is young: South of the Sahara, their average age is under 25 in all countries except South Africa.

Going forward, the continent will account for about 50% of the world’s population growth between now and 2050, predicts PricewaterhouseCoopers.

Africa’s middle classes are already growing rapidly, with one in three people now believed to be living above the poverty line, even if not among the wealthy. Meanwhile, the staggering 1.1 billion – around 42% of the continent’s population – is projected to reach middle-class status by 2060.
Of the 54 African countries, South Africa is still considered the continent’s first powerhouse and a gateway to many other African countries. But with 173.6 million citizens growing their GDP by 200% in just ten years, Nigeria is regarded as Africa’s new power actor.

FROM WEB (Romano Pisciotti)

Africa’s population will double

Projections show that by 2050, Africa’s population will double.

By 2100, one in three people on Earth will be African.

This means that, by the end of the century, sub-Saharan Africa—which already has an extraordinarily young population—will be home to almost half of the young people in the world.

With a steadily growing population heading towards 2bn, Africa’s 1.1bn workforce will be the world’s largest by 2040. Equally, with a collective GDP of $2.6 trillion by 2020 and $1.4 trillion of consumer spending, many see the impact of around 500m new middle class consumers. Africa as a continent has, on average, grown its economy by at 5% per annum over the last decade. It is already as urbanized as China and has as many cities of over 1m populations as Europe.

However clearly there are many ‘Africas’, with varied economies: from the oil exporters of Nigeria, Angola, Libya and Algeria to the already more diversified economies found in Egypt, South Africa and Morocco, there is a host of nations already with GDP per capita well over $2000. Elsewhere there are many countries such as Kenya, Tanzania, Ghana and Cameroon in transition from agricultural to manufacturing and service economies.

For years, Africa’s growth has been shaped by commodity prices – the continent has a third of the planet’s mineral resources, 10% of the world’s oil reserves and produces nearly 70% of the global diamond trade. While this has clearly been good for growth in the past, the dependency on a few key commodities, and hence their global price, has led to high levels of market uncertainty – especially around many of Africa’s currencies: at least ten African currencies, for example, lost more than 10% of their value in 2014. Although oil prices are volatile, oil and gas will however continue to be an important factor in the future of Africa – Africa will remain an important producer of oil and natural gas, accounting for 10% of global oil and 9% of natural gas production in 2035.

In a bid to diversify away from resources, several nations have been pushing hard to grow other sectors of the economy. To date, manufacturing, services and tourism in particular have all shown growth (although, whether from ebola, localized terrorism or national political change, growth from the latter source is evidently volatile). For example, while Nigeria is still very much an oil exporting economy, its service sector now accounts for 60% of its GDP – and ‘Nollywood’, its $3 billion film industry, is now the second largest in the world – bigger than Hollywood and just behind Bollywood in Mumbai. Likewise in Angola, Africa’s second largest oil exporter, where fishing, agriculture and manufacturing growth now means that a third of government revenue comes from non-oil sources. On the back of the success of m-pesa mobile payments that kicked off in Kenya in 2007, many African states, from Nigeria to the DRC, are seen as world leaders in adapting mobile technology and social networks to deliver potentially life-changing new financial platforms – many of which operate across borders and so engender greater transparency and cooperation. Older, protected, and often niche, monopolies are being superseded by collaborative, mass-market platforms from IT-enabled and, most importantly, more trusted, challengers.

FROMWEB

Presented by Romano Pisciotti

RIVA D’AFRICA

Riva d’Africa

L’oceano del silenzio

che si stende sull’Africa

è un mare stanco

di parole e promesse.

La schiuma grigia

dei vecchi riti dell’ignoranza

inquina pace e sogni

cercando l’alibi nella storia.

Non ci sono più

le rive degli schiavi

ma insistono pesanti verità

di corrotti e inutili parolai.

Folli trascinatori

con folle di sciocchi creduloni

bruciano ogni ragione

nell’illusione che l’orgoglio

stia solo nella pelle nera.

Che siano il tuo cuore,

l’intelligenza, la bellezza e la forza

a gridare il tuo orgoglio!

di Romano Pisciotti

ITALMOTOR AFRICA

http://italmotor.africa/

Big Africa

In our experience, the instinct of most businesspeople is to underestimate Africa’s size and potential as a market and overestimate the challenges of doing business there.

Romano Pisciotti 300x225 Big Africa

Romano Pisciotti teaches at the Rome Business School in Lagos

Most valued nation brand in Africa

South Africa is still Africa’s most valued nation brand, but Nigeria is catching up fast.

Africa features six of the world’s ten fastest-growing nation brands, which includes the Democratic Republic of the Congo, Egypt, Kenya, Tanzania, Ethiopia, and Ghana.

NIGERIA IN SHORT:

Nigeria is a middle-income, mixed economy and emerging market, with expanding manufacturing, financial, service, communications, technology and entertainment sectors. It is ranked as the 30th-largest economy in the world in terms of nominal GDP, and the 23rd-largest in terms of purchasing power parity.

Oil industry and mining

The basis of the Nigerian economy is the oil industry. At present, the oil industry is the foundation of the economy. Nigeria is the 1st in Africa and the world’s 8th exporter of oil. Oil provides more than 90% of the country’s export earnings. Today the daily oil production is 1.59 – 1.65 million barrels a day. Now the quota of Nigeria in OPEC is 1.8 million b/d. 65% of the produced oil is light grades with low sulfur content.
In Nigeria, coal, tin, cassiterite, and columbite are also mined. Extraction of cassiterite and concomitant columbite mineral (niobium ore) is produced by an open method. After the tin-smelting plant commissioning in 1962, most of the tin is exported as ingots. Following 1960, because of the railroad turning to diesel fuel and the appearance of cheaper and more environmentally friendly oil products, coal mining began to curtail.
Agriculture

In agriculture Nigeria employs 65% of the population. The main food crops are yams, sweet potatoes, and corn. Many lands are irrigated. Cacao beans (340 million tons), natural rubber (112 million tons), and cotton (0.4 million tons) are also grown. 31.29% of the land is cultivated.

Romano Pisciotti: working for Great Nigeria

FUTURE: AFRICA !!!…FUTURO: AFRICA !!!!

By Salih Booker and
Ari Rickman

(Versione originale con traduzione in italiano e miei commenti. Romano Pisciotti)

Beginning in 2035, the number of young people reaching working age in Africa will exceed that of the rest of the world combined, and will continue every year for the rest of the century. By 2050, one in every four humans will be African. At the end of the century, nearly 40 percent of the world’s population will be African. Yet, instead of preparing to build a relationship that can grow with the continent, based upon diplomatic cooperation, the United States is doubling down on more than a decade of reliance on its military as the primary vehicle of engaging with Africa. The consequences, as one might expect, are overwhelmingly negative.

A partire dal 2035, il numero di giovani che raggiungono l’età lavorativa in Africa supererà quelli del resto del mondo messi insieme e continuerà ogni anno per il resto del secolo. Entro il 2050, un uomo su quattro sarà africano. Alla fine del secolo, quasi il 40% della popolazione mondiale sarà africana. Eppure, invece di prepararsi a costruire un rapporto che possa crescere con il continente, basato sulla cooperazione diplomatica, gli Stati Uniti stanno facendo affidamento sulle proprie forze armate come principale veicolo per impegnarsi con l’Africa. Le conseguenze, come ci si potrebbe aspettare, sono assolutamente negative.

The impending demographic dividend will only add to Africa’s economic importance. Since 2000, at least half of the countries in the world with the highest annual growth rate have been in Africa. By 2030, 43 percent of all Africans are projected to join the ranks of the global middle and upper classes. By that same year, household consumption in Africa is expected to reach $2.5 trillion, more than double the $1.1 trillion of 2015, and combined consumer and business spending will total $6.7 trillion.

L’imminente crescita demografica non farà che aumentare l’importanza economica dell’Africa. Dal 2000, almeno la metà dei paesi al mondo con il più alto tasso di crescita annuale si trova in Africa. Entro il 2030, il 43% di tutti gli africani è destinato a entrare nelle fascia delle classi medie e superiori globali. Entro lo stesso anno, il consumo delle famiglie in Africa dovrebbe raggiungere i $ 2.5 trilioni, più del doppio di $ 1.1 trilioni del 2015, e la spesa congiunta di consumatori e imprese ammonterà a $ 6.7 trilioni.

Romano Pisciotti: …e l’Europa sta a guardare, preoccupandosi solo di raccogliere qualche disperato dal mare.

Tutto questo mentre la Cina sta investendo in modo massiccio nel continente.

… and Europe is watching, just worrying about picking up some desperate people from the sea.

All this while China is investing heavily on the continent.

AFRICA – Beautiful place in Africa

A critical question is whether Africa’s surge represents a one-time event or an economic take-off. The continent’s growth also picked up during the oil boom, but slowed sharply when oil and other commodity prices collapsed during the last years.

Today, individual African economies could suffer many disappointments and setbacks. While short-term risks remain, Africa has strong long-term growth prospects, propelled both by external trends in the global economy and internal changes in the continent’s societies and economies.

Romano Pisciotti: Like

Red skies of Africa

Red skies of Africa:
enchanted sunsets
as a prelude
to hunting nights
among the stars.
Songs of passion
from peoples who,
in the darkness,
watch over their dead.
Silent warriors
seek the pride lost
in the eddies of oil
and in the hatred
between brothers.
The great rivers
drag shame to the sea,
but they can not
wash consciences.

Romano Pisciotti

Cieli di Africa rossi di tramonti incantati, preludono a notti di caccia tra le stelle e canti di passione di popoli che vegliano nel buio i loro morti. Silenziosi guerrieri cercano l’orgoglio disperso nei gorghi di petrolio e nell’odio tra fratelli. I grandi fiumi trascinano al mare la vergogna, ma non possono lavare le coscienze.

The Louisiana Offshore Oil Port (LOOP)

TANKER OFFLOADING

LOOP safely and efficiently offloads tankers of crude oil that are imported into the U.S. from the Arabian Gulf, Russia, West Africa, the North Sea, Mexico and South America. Many tankers that discharge their cargoes at LOOP are supertankers and are designated as either “very large crude carriers” (VLCCs) or “ultra large crude carriers” (ULCCs). These massive ships can be longer than the Empire State Building is tall.

In response to change US supply patterns, LOOP has made modifications to it’s mooring configuration to receive Jones Act compliant Medium Range (MR) tankers to receive cargoes from US ports. It also allows for FPSO shuttle tankers to deliver their cargo to LOOP.

The LOOP oil port and pipeline were specially constructed to accommodate these enormous vessels. Standing in 110 feet of water some 20 miles from land in the Gulf of Mexico, the LOOP Marine Terminal can comfortably accommodate tankers calling at the port.

Once anchored at one of the three single point mooring (SPM) buoys, hoses are attached to a ship’s manifold for offloading. Hi-tech, flexible hoses are attached to the ship’s manifold to receive and transport the crude oil. It is pumped from the ship in an underground pipeline.

Oil movement controllers from LOOP, in close communication with the ship, initiate the offloading of the vessel to the LOOP Marine Terminal where it is pumped into a 48-inch diameter pipeline to the LOOP storage facilities at a rate of up to 100,000 barrels per hour.

The oil arrives at the LOOP storage facility in Clovelly, Louisiana, some 45 miles from the marine terminal. There the oil is stored in a network of underground caverns and aboveground tanks. The LOOP marine terminal, pipeline and storage facilities reside in a Foreign Trade Zone (FTZ) which provides opportunities for companies importing foreign crude oil to optimize their U.S. Customs duties.

Romano Pisciotti surfing web