Awolowo Road has long been a destination for enterprising Nigerian traders. In the 1990s, Kola Karim became one of them, setting up shop on the road that links the plush neighbourhood of Ikoyi to the tumult of the Lagos Island business district, selling shirts and jeans to the throngs.
Today, Karim has been propelled by ambition, friends in high places and a string of well-timed investments to the status of “minigarch” – one of an emerging tier of tycoons flying private jets, driving fast cars and playing polo. This new elite has prospered on the back of a decade-long boom fuelled by soaring oil prices and market reforms that together have helped shake Africa’s most populous nation out of commercial torpor.
Over the next decade, he and other cosmopolitan business people – “Afropolitans” using Asian, European and US capital to invest in African opportunities – have their sights on expanding their businesses across the continent. Nigerian, Kenyan and South African companies are moving
faster across borders, tapping into neighbouring growth markets. The perception that the sum of the continent’s many moving parts is now greater than the whole, is taking root in multinational boardrooms, even if many Africans have yet to see the benefits.
This week, the Financial Times will explore Africa’s evolving business landscape. The series will include a look at the growing presence of private equity firms in Africa, evolving consumer markets, technology innovators and new pan-African multinationals. Influential Africans and business people will also give their views on the continent’s prospects.
“If you go to Kenya now, versus the Kenya of 10 years ago, it’s two different places. The cars are much newer,” says Johan Van Zyl, deputy head for Africa, Latin America, the Middle East and the Caribbean at Toyota. “In Angola, you see infrastructure, you see roads, you see new areas being developed, residential areas. If you go to a place like Senegal, there’s this fantastic shopping mall, with all the branded shops in it. That was not there five years ago.”
Market liberalisation has spurred growth and a jolt of entrepreneurial energy has charged the formal and informal sectors. But perhaps the biggest factor has been the engagement of emerging powers, led by China.
The accelerating influx of Chinese capital, labour and goods into Africa gets a mixed press. But Asian demand for African resources has spurred a boom in the commodities the continent has in abundance. Trade between China and Africa increased 20 times over the past decade, reaching more than $200bn in 2012.
The investment bandwagon has also gained momentum because opportunities elsewhere have shrunk amid the debt crisis in Europe and a slowdown in the Americas. Meanwhile, banks and multilateral finance institutions are promoting “Africa surpasses Asia” as the growth story of the next decade. Renaissance Capital, the Russian investment bank, recently published its own upbeat account titled “The Fastest Billion” – a riff on The Bottom Billion, the UK academic Paul Collier’s treatise on the poverty trap.
These investment stories can seem overheated on a continent that is patchily developed and still represents only a tiny proportion of global trade. Those influencing the course of events also remain a mixed bunch – from kleptocrats, warlords and narco-terrorists to entrepreneurs, reformers and social innovators.
