Six out of 10 world’s fastest-growing nation brands in Africa- Report
Six out of the 10 fastest-growing nation brands in the world are in Africa, according to a recent report.
The countries with these brands are Democratic Republic (DR) Ethiopia and Egypt, Ghana, Kenya, Tanzania, according to the issued by United Kingdom-based Brand Finance, the world’s leading branded business valuation and strategy consultancy. These countries recorded annual growth rates of between 28 percent and 38 percent, Brand Finance said in its 2018 Nation Brands report.
The other four countries among the top 10 growing brands are Cyprus, Slovenia, Germany, and Estonia, with brand value growth rates between 27 percent and 39 percent, according to the report.
Both Nigeria and South Africa, Africa’s leading economies by size, emerged lagers on the growth performance, with rates of six percent and seven percent, respectively.
Countries such as United States of America, China, Germany, United Kingdom and Japan were the top five nation brands by size, this year. Brand Finance said they measured the strength and value of the nation brands of 100 leading countries using a method based on the royalty relief mechanism.
BusinessDay analysis of the report shows that the brand value of South Africa, the most industrialised nation in Africa, fell by 7 percent to $207 billion in 2018 from $222 billion in 2017 and Nigeria, Africa’s biggest economy, grew marginally by 6 percent to $203 billion this year from $191 billion in 2017. Globally, Nigeria ranked 50th, dropping by three positions from 47th position in 2017.
Babatunde Odumeru, MD, Brand Finance Nigeria, expressed dismay that Nigeria emerged Africa’s second most valuable brand, just a shot behind South Africa. He noted that Nigeria’s brand value grew marginally at six percent, while brands such as Ghana, Kenya, Tanzania, DR Congo, Ethiopia and Egypt recorded an average growth rate of 34 percent.
“If we are ever going to compete effectively in the future with these countries for investors, exports, tourism and talent, we’ll need to do more in improving our nation brand management,” Odumeru said in a statement, made available to BusinessDay.
Analysts believe that Nigeria does not have strategies to stimulate brand growth. “You may have a good brand but it may not really translate to growth, it strategies that will stimulate growth are not in place and that is the problem in Nigeria,” Ayo Akinwunmi, Head of Research, FSDH Merchant Bank told BusinessDay by phone yesterday. He added that Nigeria has extremely weak infrastructure which is a growth enabler, and policies that scare away investors.
However, comparing national performance on an issue such as brand value growth should take cognizance of a country’s peculiar challenges at any point in time, said Ayodele Teriba, CEO, Economic Associates. In the case if Nigeria, for instance, he pointed out that the country recently experienced developments that impacted its performance on brand value.
“Nigeria had its own issues, for instance, recession and devaluation which were triggered by the weakness in global oil price. So its brand value is not growing much because it has challenges in revenue and economic growth, but it is a temporary thing,” Teriba said.
Ayodeji Ebo, MD, Afrinvest Securities Limited believes that the slow growth in Nigeria’s value reveals the slow rate of brand adoption by Nigerian businesses due to other associated costs of business which contract margins.
“Most businesses in Nigeria operate more in the informal sector and as a result, does not see a reason to brand or differentiate their products. Businesses have been expanding but maybe most businesses have not been rebranded,” Ebo further said.