Seeds of Opportunity: The African Growth Series

In this week's issue, you will learn more about:

AFRICA OPPORTUNITY: Powering Regional Integration with the Zambia-Tanzania Interconnector 

Zambia is set to resume construction of the USD320 million Zambia–Tanzania Interconnector Project (ZTIP) is a transformative 620 km, 400kV double-circuit transmission line stretching from Kabwe in Zambia to Iringa and Sumbawanga in Tanzania. Co-financed by the World Bank, European Union, and the UK, the project is expected to be completed by 2028. 

The interconnector will enable efficient power exchange between Zambia and Tanzania, enhancing grid stability and catalysing regional electricity trade. By improving access to reliable electricity, the project supports industrial development, job creation, and economic growth in both countries. 

Achim Fock, the World Bank's Country Manager for Zambia, noted that an integrated market connecting the Southern and East African power pools would lower electricity costs, boost energy security, and unlock new opportunities for trade and investment across Africa. 

Additional benefits include improving power supply reliability for future plants in southern Tanzania and creating a major transmission corridor that connects Ethiopia–Kenya–Tanzania to Southern Africa through Zambia. 

This initiative highlights the power of cross-border collaboration in driving sustainable development and energy integration across the continent. 

AFRICA OPPORTUNITY: Advancing Flexible Gas Power in Mpumalanga, South Africa​

South Africa's energy transition is gaining momentum with the introduction of a 1,000 MW flexible gas-engine project in Mpumalanga by independent power producer FlexED. Known as Khanyazwe Flexpower, the project is launching near Malalane, in close proximity to the National Transmission Company South Africa’s (NTCSA’s) Khanyazwe substation and with confirmed access to the Rompco gas pipeline from Mozambique to South Africa. This initiative aims to provide the necessary grid stability and ancillary services as the country increases its reliance on variable renewable energy sources. ​​

​The project's location in Mpumalanga, a region historically dependent on coal, signifies a strategic move towards diversifying energy sources while leveraging existing infrastructure. By incorporating flexible gas engines, the project addresses the intermittency challenges of renewables, ensuring a more resilient and reliable power supply.​​

This development also presents opportunities for local economic growth, job creation, and skills development, aligning with South Africa's broader goals of a just energy transition. As the energy landscape evolves, such projects underscore the importance of adaptable solutions that balance sustainability with economic imperatives.​ ​

​How can your organisation contribute to South Africa's evolving energy mix while promoting regional development?

AFRICA OPPORTUNITY: Kenya’s Industrial Boom Takes Shape with SEZs​​

Kenya is fast-tracking its industrial future with a landmark USD 3 billion, three-year commitment from Afreximbank to boost trade and industrialisation. The focus? Developing industrial parks and special economic zones (SEZs) like Dongo Kundu and Naivasha II, set to follow a Public-Private Partnership (PPP) operating model. These SEZs, part of Kenya’s Vision 2030, aim to drive export manufacturing and economic growth, leveraging shared infrastructure and strategic locations.​​

Backed by Arise IIP and the Kenyan government, these projects tap into Africa’s projected industrial CAGR of 5.2% through 2030. With Naivasha II positioned along the Northern Corridor and Dongo Kundu enhancing Mombasa’s economic clout, Kenya is poised to become a hub for value-added exports. ​

​What are your thoughts on Kenya’s industrial strategy—game-changer or gradual evolution?

AFRICA OPPORTUNITY: Atlantis SEZ Zone 1 Launch with Quantum V3 Facility Groundbreaking​​

On April 7, 2025, the Atlantis Special Economic Zone (ASEZ) in the Western Cape marked a significant milestone with the official launch of Zone 1 and the groundbreaking ceremony for the Quantum V3 facility. ​​

This R18-million Quantum V3 investment is set to boost South Africa's green economy through the sustainable production of acetylene gas using sustainable practices. The Quantum V3 facility will incorporate solar energy systems and utilise hempcrete construction and advanced digital technologies, showcasing a bold commitment to eco-conscious manufacturing. The launch of Zone 1 is expected to attract further investments, stimulate local employment, and position ASEZ as a hub for green technology and industrial innovation.​

The Deputy Minister of Trade, Industry, and Competition, Andrew Whitfield, said, “The ASEZ is not just about infrastructure. It is about unlocking the potential of high-value industries, empowering communities, and building the resilient, low-carbon economy South Africa needs”. This development underscores the potential of Special Economic Zones in driving sustainable industrialisation and economic diversification in Africa.

AFRICA OPPORTUNITY: Transitioning to a Cashless Society in South Africa​

Around the world, cash has historically been king. However, recent years have shown the rise of cashless payment systems, such as the broader use of bank cards, phone payments, and online transfers. The benefits of the move to cashless payments include the faster reflection of payments, which allows for more up-to-date business decisions than cash payments. Additionally, the transaction fees of online payments do not incur cash processing costs, allowing the business to net greater profits. Lastly, businesses and consumers need not incur safety risks associated with carrying large amounts of cash. ​

Barriers to growth exist, such as the strong link between digital devices and online payments, which exclude a proportion of the population that does not have digital access. Furthermore, there is much distrust of digital banks due to the history of hidden fees and unauthorised debit orders. This urges consumers to trust cash as a tangible measure of financial management, as individuals have complete control over their finances.​​

Undeniably, this transition provides various opportunities for African businesses, such as new avenues for small business transactions, allowing for better historical ledgers. This allows businesses to build up a credit history, enabling greater access to financial services and visibility of business performance and insight. Lastly, the public sector is presented with the opportunity to digitalise social welfare programs, which would streamline the process of distributing grants, avoiding drawn-out physical collection.​​

There are threats to overcome, such as limited consumer education, which has led to a distrust of digital payment systems. This can be overcome through more transparent communication between banks and consumers and education programs to spread awareness of the benefits of a cashless society. Despite the current prevalence of cash in South African society, the general trend indicates a gradual move towards digital payment systems, thus providing greater strength to these opportunities.​

To find out more about opportunities in Africa, please get in touch with Lynne Martin.

Lynne Martin

Sales Contact, Frost & Sullivan Africa

• lynne.martin@frost.com
• +27 21 680 3260