Africa’s economic renaissance is a key global theme today, and multiple studies have been targeted at the continent with a view of fully understanding its dynamics and potentials. One of such recent reports, produced by PricewaterhouseCoopers (PwC), defines the key determinants of an African City of Opportunity.
Current development or future potential: The pace of growth of an African city today is a significant indicator of its potential tomorrow. Countries that continue to improve their ease of doing business, for instance, may not be economic super-powers today, but are laying a solid springboard for a superior economic leap in the future. “In the long run, intelligent investment will be determined by access to a growing middle-class and not to rich natural resources,” the report reads.
Location: The geography of an African city can be representative of the kind of opportunity it presents – it isn’t a co-incidence that the top African economies today have access to water ways, which enhances their potential for trading.
Nature of the opportunity: Not all African cities are currently suitable for every kind of opportunity. The key, therefore, to determine an appropriate target city starts from the nature of the opportunity itself and the capabilities of the city in terms of resource and infrastructure base. Investors eyeing the extractive industries in Africa may require a different economic due-diligence to those set to pour funds into telecommunication or ecommerce.
Time Scale: In business today, what you do is as important as when you do it – timing remains a critical determinant of success even in investments. Depending on the time required for the investment to start bringing returns, many investments might simply not prove profitable. Be that as it may, the most profitable investments are the longer-term variety. The quickness of establishing a business is also key. Investors don’t want to waste resources to manoeuvre bureaucratic and environment challenges when setting up their businesses on the continent.
Based on these criteria, PwC has identified 20 African Cities of Opportunity. They are Luanda, Kinshasha, Maputo, Antananarivo, Douala, Dar es Salaam, Lusaka, Kigali and Abidjan.
Others include Dakar, Kampala, Addis Ababa, Lagos, Nairobi, Accra, Algiers, Casablanca, Johannesburg, Tunis and Cairo.
