UK-based insurance company Prudential is expecting Africa to mirror the economic progress seen in Asia over the past two decades.

“We think Africa can be the new Asia, both for us as a company and for the global economy,” said Matt Lilley, CEO for Africa at Prudential, during a recent conference at the University of Cambridge Judge Business School.

He highlighted the continent’s young growing population and urbanisation as potentially positive economic fundamentals.

Last year Prudential bought a life insurance business in Ghana. It has ambitions to also expand to other countries across the continent.

The company has a strong presence in a number of Southeast Asian countries, including Indonesia, Vietnam, Malaysia, Thailand and the Philippines.

Lilley said Prudential’s growth in Southeast Asia has been driven by the fact that despite diverse lifestyles, human needs are similar in that “everybody wants to protect against the risk of losing their breadwinner; everybody aspires to give their children a better education than they had themselves”.

“We don’t see Africa as any different… There is a broad-based growing middle class in most African countries… who have the same hopes for the future, for themselves and for their children, as in any other part of the world and we just see an opportunity… to build a successful and profitable business in Africa, just as we have in Asia,” he noted.

However, emerging markets often suffer from volatility, making a long-term investment approach essential.

“In 1995, we opened a business in Indonesia. Two years later it was one of the hardest hit countries in the Asian financial crisis. The government had to ask the IMF for a US$40bn bailout, and in 1998 GDP growth was -14%… A lot of multinationals scaled back their operations [and] stopped investing. For us though, the long-term fundamentals and reason we were there hadn’t change. We continued to invest in the business.”

Companies looking for a quick buck and not willing to take risks will find Africa’s many challenges insurmountable, according to Lilley. Those with a long-term mindset could however reap great rewards over the next 10 to 15 years.

Of all the challenges to doing business in Africa, Lilley highlighted security concerns, such as those currently seen in countries like Nigeria and Kenya, as the most worrying to Prudential.