- In less than 20 years or so, African brands have caught up, probably beyond expectations, when the region was mostly known for its minerals and crops that were exploited incessantly by countries in other regions, particularly the West. That is indeed, in good pace. But Africa has to look much beyond what it has been achieved in the last 20 years.
- Its next 20 years should have more pronounced accent on brand building.
- Africa should also have a well orchestrated perception management system amongst investors. They should realize the continent can not only provide the raw materials and primary goods for processing elsewhere but infrastructure, local skills and investment environs for doing that within Africa. It is like hard-selling Africa.
- The most populous country in Africa -Nigeria-has only a fraction of the population of India, the second populous in country in the world after China. That calls for projecting Africa as a single market of 1.3 billion people in the making to catch up with the investment flows in China and India, which individually has more than that number of people now.
There is a growing awareness about Africa as an investment destination. More companies are discussing about the African continent and its potentials for investing there more than ever before. But the moot point is whether it has emerged as a powerful brand to reckon with or an epicenter of broad room conjecture?
Let us not take extreme examples of what Coco Cola or Pepsi to the US or Mercedes Benz to Germany or Toyota to Japan. There is other less known brands across the world but still evoke respect and awe, such as Taj Group of Hotels to India or Fiat to Italy. Can there be any matching brands in the whole of Africa to play up. Some say, MTN of South Africa or Aliko Dangote’s cement plant in Nigeria are emerging as global brands. Yet, they have to traverse a long distance to catch up not only with the best in the world but also with brands lower down.
Even then, no one can berate the continent for lack of brand consciousness. In less than 20 years or so, African brands have caught up, probably beyond expectations, when the region was mostly known for its minerals and crops that were exploited incessantly by countries in other regions, particularly the West. That is indeed, in good pace. But Africa has to look much beyond what it has been achieved in the last 20 years. Its next 20 years should have more pronounced accent on brand building.
Undeniably, there are efforts by countries separately and together under the banner of several development initiatives. African Union, AfCATA, several economic and monetary unions etc are examples of that drive to make the region or subregion an economically happening place.
It is instructive to see whether Africa as a whole has to be introspective about what the investors have in mind – not about the potentials but the bottlenecks and handicaps that often the investors talk about. Some of the challenges are inherent while a lot more of them are man made. The law and order situation is more pronounced among them. Investments and investors go only to places where there is peace and tranquility. That is a cover or a hedge for investments they make. One can argue that hardly is there any place in the world, which can fit into that slot barring some of the Scandinavian countries or island nations like Singapore, and New Zealand. Yet, people invest, perhaps, more in the US, some countries in Europe, China and a lesser extent in India, where there are reports about law and order situation. But people ignore such happenings as aberrations and there are well-oiled systems in these countries for perception management. Africa should also have a well orchestrated perception management system amongst investors. They should realize the continent can not only provide the raw materials and primary goods for processing elsewhere but infrastructure, local skills and investment environs for doing that within Africa. It is like hard-selling Africa.
The second level of perception management needed is about the rate of return on capital. Nowhere in the world, is the rate of return expected by an investor is as high as in Africa. Some analysts say the investors are expecting close to 50% return on investment, whereas world over that rate is 10-12%. Why people expect more from investments in Africa? That again stems out of a perception that investments in the continent are riskier and therefore, there should be a higher return on the capital. How to address that misplaced perception should be the joint responsibility of the Africa Inc and the governments. Can they organize road shows in important centers in the US, Europe, China, India, Southeast Asia etc to promote Africa as a region for investments and to clear the doubts among them about the policy matrices that are in place to support investments and how they can unveil their investment plans in a win-win manner? That said, there are a growing number of misconceptions being floated most often by the vested interests to dissuade the potential investors. There can be among them some investors who were caught in the wrong side of law during their operations in the continent. These international road shows should also give a platform for successful businessmen from within the region and beyond to share their experiences about their investments. That will cut more ice than the policy-makers incessant high decibel pleas to have more investments. It is also instructive that Africa sends private sector delegations abroad since there is a feeling outside that most of the industries are owned by the government sector though that is not the case with countries like Nigeria, South Africa, Tanzania etc.
There is also another aspect that has to be kept in mind, which is perhaps unique to the continent unlike. There are two countries in Asia-China and India-which are of the continental size, where the foreign investors may be attracted by the sheer size of the domestic market. That is not the case with Africa. The most populous country in Africa -Nigeria-has only a fraction of the population of India, the second populous in country in the world after China. That calls for projecting Africa as a single market of 1.3 billion people in the making to catch up with the investment flows in China and India, which individually has more than that number of people now. The challenge is that most of the countries in the continent enjoy only a limited domestic market and disparities in purchasing power country-wise, which can further truncate the market.
In short, apart from the prospects, Brand Africa- has many challenges to face. At the end of the day, that is precisely the case with most of the countries and regions in their initial development trail.
