While there has been political and civil conflict in North Africa in recent years, the region’s geographical position and business opportunities makes it an attractive area for foreign investors and local business expansion.
So says Dr Mohamed Kayyali, CEO and co-founder of business consultancy firm 4DIT (also known as 4D). The company was founded in 2008 in Dubai (serving the Middle East) and has since opened offices in Rabat, the capital of Morocco, to cater to the business needs of companies in North Africa.
Dr Kayyali, who is a Harvard Business School graduate, author and prominent speaker on technology and business, spoke to How we made it in Africa about the business environment in North Africa and the industries worth investing in.
Can you give us examples of some of your clients in North Africa?
We work with clients across industries and geographies to integrate sustainability approaches into their business strategies, operating models and critical processes. Our holistic approach encompasses strategy, design and execution to increase revenue, reduce cost, manage risk and enhance brand reputation and intangible assets.
What are some of the challenges that businesses face in North Africa?
North Africa in general is a great place to invest for the long term, especially large-sized industries that are always looking to expand in Africa, starting from the north… Its positioning also offers a link between the African market and Europe, as well as West Asia.
However, the biggest challenge facing many multinational businesses is the limitations to expansion and allocating investments, mostly for medium-size businesses that struggle with several poor public and government conditions which cut off their ability to launch new businesses in these regions. This is where our expertise comes in as a business consulting firm advising multinational companies.
What are some of the business trends and opportunities that you are witnessing in the region?
Mining and metals is a great industry to invest in, along with energy and chemicals. In particular, there are also regions that produce petrol and diesel profitably from coal and natural gas. Manufacturing, information and communication technology (ICT) development, and mining are the key industries, while agriculture and copper mining have traditionally been important in many regions.
Tunisia has a diverse economy. Important sectors include agriculture, mining, manufacturing, petroleum products and tourism. In 2009, Tunisia was ranked the most competitive economy in Africa in the Global Competitiveness Index by the World Economic Forum.
In Morocco, the tourism, telecoms, information technology and textile industries are showing the strongest growth. Morocco has made starting a business easier for limited liability companies.
Drawing from your knowledge, what advice do you have for multinational companies looking to expand into North Africa?
I do believe in order to avoid the major problems of doing business in Africa – such as facing poor business models, poor infrastructure, poor education levels, government constraints and poor management of technology (which I personally call the Big Five) – multinational companies must launch their own businesses by empowering and supporting human manpower, preparing the right tools for managing their business, building a large portfolio of decision makers and approaching the correct commercial and business model.