Business leaders maintain a positive outlook for 2010, with 95 percent of those surveyed expecting to expand their business over the coming year.
Results of africapractice’s annual business survey support the growing belief that Africa is beginning to recover from the financial crisis. 100 percent of respondents said that they anticipate levels of foreign direct investment to rise in 2010, the majority expected to come from China.
This represents a much-improved outlook when compared to last year’s survey, in which 69 percent of respondents predicted a reduction in FDI flows.
When asked what they thought would be the biggest challenges to their business in 2010, executives were split between access to credit and availability of talent, which received 35 percent and 30 percent of votes respectively.
This echoes last year’s survey in which 31 percent of respondents cited talent as the biggest concern. Physical infrastructure and legislative environments were also cited as potential growth limitations.
The future role of the United States prompted a mixed reaction, with only 17 percent of business leaders expecting the Obama administration to have a positive influence on Africa.
However, there is a consensus of optimism surrounding the impact of the FIFA World Cup, although most (54 percent) believe that benefits will be felt only in South Africa itself.
The majority of respondents cited advancements in technological infrastructure as being more significant for business opportunity than politics, thus reaffirming the common assertion that ICTs are key enablers of productive business.
Increased intra-African business and moving away from a reliance on international exports was cited as key in Africa’s private sector development with Alasdair Munn, Director of Rebuild Zimbabwe commenting, “The biggest market for Africa is Africa herself. Growth in private investment and empowering communities has greater potential for Africa than just exports.”
Marcus Courage, Managing Director of africapractice said, “It is fantastic to hear business leaders speaking so positively about Africa again, with so many expecting their businesses to grow significantly in 2010. However, finding talent and access to credit are recurring challenges, which should act as a clarion call to both government and the private sector about where investment needs to be made, in order to facilitate and encourage further growth.”
The africapractice survey of business leaders was conducted in the first last two weeks of November 2009. 37 executives from telecoms, beverages, banking, media, private equity and mining businesses, all of them invested in Africa, were interviewed.
Africapractice is a strategic communications consultancy with a network of offices across the African continent.
Summary of survey results
What will be your company’s biggest challenge in 2010?
Credit – 30%
Political / legal infrastructure – 5%
Crime / Security—0%
Other — 16%
What investment plans does your company have in 2010?
Expand significantly – 68%
Expand slightly – 27%
Maintain existing business levels – 5%
Reduce slightly – 0%
Reduce significantly – 0%
Do you expect Foreign Direct Investment (FDI) in Africa to grow in 2009?
Yes, with the greatest proportion coming from China – 83%
Yes, with the greatest proportion coming from Europe – 11%
Yes, with the greatest proportion coming from Asia excl China – 3%
Yes, with the greatest proportion coming from Latin America – 0%
Yes, with the greatest proportion coming from other African nations – 0%
No, FDI flows will reduce slightly – 3%
No, FDI will reduce significantly – 0%