Seeds of Opportunity: The African Growth Series
May 2023 | Issue 1
In this week's issue, you will learn more about:
- AFRICA OPPORTUNITY: The Opportunity of Critical Metals in Africa
- AFRICA TREND: Resilience in Africa’s Start-up Funding
- AFRICA OPPORTUNITY: Zambia and DRC as Electric Vehicle Manufacturers
- UPCOMING EVENT: ENLIT AFRICA 2023
- UPCOMING EVENT: ENLIT AFRICA 2023
AFRICA OPPORTUNITY: The Opportunity of Critical Metals in Africa
The global energy transition is underway, driving the demand for critical metals (e.g., copper, lithium, cobalt, etc.). Africa hosts vast reserves of these critical metals and is uniquely positioned to take advantage of this opportunity to supply the world with critical metals. These reserves will drive the development of African countries and bring about new investment opportunities to be taken advantage of.
In this video, Management Consultant Patrick Prestele discusses the opportunity of critical metals in Africa - https://youtu.be/HQQnbj6evxo.
AFRICA TREND: Resilience in Africa’s Start-up Funding
Despite facing challenges, funding into African startups demonstrates remarkable resilience compared to other regions. Since the global economic downturn in Q1 2022, Africa is the only region where the quarterly year-on-year (YoY) growth in startup funding has consistently surpassed the global average every quarter. For example, in Q1 2023, funding in Africa was 29% lower than in the previous year's period. In contrast, funding in the United States dropped by 54% YoY, in Asia by 65% YoY, and in Latin America by a staggering 80% YoY. The comparison with Latin America is relevant since both regions have similar funding volumes and stages of ecosystem development. Historically, Africa has lagged behind Latin America. In 2021, over US$20 billion was raised in South America, more than four times the total raised in Africa (US$4.5 billion). However, this gap narrowed rapidly in 2022, when African startups held up better than those in other regions, whilst funding in Latin America plummeted. By the end of 2022, Latin American startups only raised 50% more than their African counterparts (US$7.7 billion versus approximately US$5 billion). Finally, in Q1 2023, African startups raised more funding than those in Latin America.
AFRICA OPPORTUNITY: Zambia and DRC as Electric Vehicle Manufacturers
The Democratic Republic of Congo (DRC) and Zambia seeks to unlock Africa's potential in the electric vehicle (EV) manufacturing market. Through a collaboration of private and public investors, progress is underway in plans for establishing dedicated special economic zones (SEZs). The SEZs will see the production of battery precursors, batteries, and electric vehicles, utilising abundant critical mineral resources in both countries. In 2022 the two countries collectively accounted for 11% of the global copper supply, with DRC accounting for approximately 70% of the global cobalt supply and 88% of cobalt exports. Yet, Africa largely remains an exporter of unprocessed critical minerals, with value addition done by foreign manufacturers. The recent plans will require multi-stakeholder collaboration, as input critical minerals required for EVs are not wholly concentrated in a single country. Eliminating bottlenecks in mineral production through refined governance is also critical in attracting new investments into the African mining sectors. Key stakeholders for the proposed SEZs include the African Export-Import Bank (Afreximbank), the United Nations Economic Commission for Africa (ECA), and ARISE Integrated Industrial Platform. For Zambia, the plans come at an opportune time as it has welcomed new investment in copper mining through a JV signed between Arc Minerals Limited and Anglo American for copper interests in the northwestern region of Zambia. As the energy transition topic continues to snowball, Africa has the potential to be a key player, but current challenges around manufacturing, power, infrastructure, and governance need to be addressed.
UPCOMING EVENT: ENLIT AFRICA 2023
Frost & Sullivan Africa is excited that its Partner & CEO, Hendrik Malan, will speak at Africa’s Most Influential Power, Energy & Water Conference and Expo, Enlit Africa 2023 on the 18th of May.
His topic, titled ‘’Tracking Project Development in Africa’’ will provide an update on the latest infrastructure investment progress across Africa. It will also highlight the direction of the funding and the pipeline of opportunities currently undergoing viability assessment. The analysis is based on Frost & Sullivan’s Infrastructure Barometer which tracks project data on a monthly basis and is then combined with its sector insights.
To learn more about Enlit Africa Visit: https://lnkd.in/d4Z2ya8N
⚡SECURE YOUR FREE ENLIT AFRICA PASS HERE: https://lnkd.in/dnhkSJB8
⚡Unlock more opportunities & purchase your exclusive delegate pass here: https://lnkd.in/dGeQQ8gt
UPCOMING EVENT: ENLIT AFRICA 2023
Big 5 Construct Southern Africa is celebrating its 10th edition and you're invited! Join thousands of construction industry professionals for three days of valuable business.
Register now for free and unlock your business potential, with access to:
⚡World-class products and cutting-edge technologies from over 200 local and international suppliers, all in one convenient location
⚡Valuable insights with over 30 free, CPD accredited seminars and workshops led by industry experts
⚡Endless opportunities to grow your network
⚡Solutions to the industry’s most pressing issues at the Stakeholders Engagement Forum
⚡ A sneak peek into the future of construction in Southern Africa with exclusive project showcases
⚡And so much more!
To register and secure your spot, please follow this link: https://bit.ly/3LmJzvE
To find out more about opportunities in Africa, please get in touch with Lynne Martin.
