Doing business and investing in Africa is currently all the rage. The IFC predicts that sub-Saharan Africa’s economic growth for this year will come in at around 5.1%. But is the continent only looking attractive because many other parts of the world are doing so poorly?
This topic was raised by Arnold Ekpe, former CEO of Ecobank, during a panel discussion at the recent New York Forum Africa, held in Gabon.
“Africa is in fashion and Africa is sexy, but really if you stand back and ask yourself what is going on – Africa looks very attractive because all the others are doing so badly. Growth in Africa is not accelerating from 5% to 7% to 10% to 12%, as it should be. However, Europe is in crisis, the US is in recovery, China has slowed down, therefore if you are doing 5-6%, that looks very good. On the contrary, when… those regions start to grow [again], then Africa will not look that good,” said Ekpe.
He noted that the continent needs double digit growth in order to catch up with the rest of world.
“The point I’m making is not that Africa is not growing… it is that we can grow a lot faster, we should be catching up, we should not be ambling along,” Ekpe added.
Ekpe is regarded as one of the most influential African businessmen of his generation. Ecobank was established in Togo in 1985 as an initiative to create a private African banking institution in West Africa. Ekpe was CEO of the bank from 1996 to 2001. He rejoined as CEO in 2005, and led the growth and transformation of Ecobank into a leading pan-African financial institution with a presence in 33 countries. At the end of 2012, Ekpe retired from his position as CEO.
During the Forum, Ekpe called on African governments to make it easier to do business on the continent. “I’ve often wondered why we don’t have an African Union passport, because that would make travelling in Africa so easy. It is actually easier to travel in Africa with a European passport, than it is with an African passport.”
He said that Africans should, themselves, invest in the continent and not wait on foreign investors. “There are significant pools of capital in Africa that we can tap into… I think building a road from Libreville (Gabon) to Brazzaville (Congo) can be done by the governments themselves, and that would stimulate and improve trade… But if you are waiting for the foreigners to come and do it for you when you know there is a need… then I think we start to see why Africa is not growing as fast as it should be.”