Seeds of Opportunity: The African Growth Series
August 2024 | Issue 2
In this week's issue, you will learn more about:
- AFRICA TREND: Special Economic Zones Fuel Industrial Growth
- AFRICA TREND: Alternative Fuels in the Energy Transition
- AFRICA TREND: Nigerian Currency Reform – The Naira is Evolving
- AFRICA TREND: The Road to Universal Healthcare in South Africa
AFRICA TREND: Special Economic Zones Fuel Industrial Growth
Special Economic Zones (SEZs) are emerging as powerful catalysts for Africa's industrial growth. From Ghana to Ethiopia, governments are leveraging SEZs to attract investment, boost exports, and create jobs. Ghana's Free Zones generated over 35,000 direct jobs and USD 1.7B in export revenue in 2023. Meanwhile, Ethiopia's industrial parks attracted USD 586M in investments, with 90% from domestic sources.
This trend is reshaping Africa's economic landscape, positioning the continent for sustainable growth in the AfCFTA era.
AFRICA TREND: Alternative Fuels in the Energy Transition
E-fuels derived from vegetable oils and animal fats are revealing themselves to be the most accessible short-term solution for alternative fuel production. While sources such as these are insufficient in availability to substitute higher percentages of petroleum-based fuels, they can be used in conjunction with other green fuel alternatives (green hydrogen) to substantially impact the energy transition.
Alternative fuel sources are an important aspect of the transition to green energy in transportation. While electric vehicles gain attention as cleaner alternatives, e-fuels, and biofuels are also something to consider for their applicability and use in current internal combustion engines. While vegetable oil and animal fats constitute the traditional sources for bioethanol and biodiesel production, new trends are emerging for using organic wastes as feedstock for production. This could be organic biomass waste, sugar bagasse, and corn husk, to name a few.
AFRICA TREND: Nigerian Currency Reform – The Naira is Evolving
Nigeria’s president, Mr Bola Tinubu, was elected in the first quarter of 2023 and has since allowed the national currency, the Naira, to depreciate twice. As the second-largest economy in Africa, many are waiting with bated breath as currency reforms begin to emerge.
Nigeria faces issues such as a US dollar shortage, a balance of payments crisis, and inflation closing in on 30%. These concerns show the need for reform but are inhibited by inefficient public spending of scarce capital, which strains public finances biased towards expensive and ambitious government projects. This is because projects typically involve complex infrastructure, which boosts the demand for imported building materials.
Currently, reform-oriented technocrats are in place at the central bank, which indicates a shift towards currency reform. Additionally, President Tinubu has promised a less interventionist approach in his term but will need to manage the historically entrenched interests of all stakeholders.
Nevertheless, building blocks are in place to move Nigeria forward and benefit its people. And Frost & Sullivan Africa will be closely watching what is to come!
AFRICA TREND: The Road to Universal Healthcare in South Africa
Learn more as Senior Consultant Yaa Ngonyama at Frost & Sullivan Africa discusses the National Health Insurance (NHI) Bill and how its recent signing by President Cyril Ramaphosa marks a step towards universal healthcare in South Africa. However, full implementation is still a long way off, with the Bill needing to pass through public hearings and parliamentary debates and address various concerns before it becomes fully operational. The NHI aims to provide all South Africans access to quality healthcare, but the journey to achieving this goal is complex. Private healthcare will remain largely unaffected until then, with medical schemes offering complementary cover.
To find out more about opportunities in Africa, please get in touch with Lynne Martin.
