Africa, described as a fast-growing continent for foreign direct investment, has an abundance of natural and human resources and untapped market potential. Rich in commodities, it has 40% of the world’s gold reserves and 30% of mineral reserves, many being critical to the technology, automotive and energy industries.

The wealth of resources also extends beyond commodities to its vast human capital and potential. According to a recent study by Cities Alliance, a global partnership fighting urban poverty and supporting cities to deliver sustainable development, over 60% of the population in Africa is below 25, which suggests it is a hotbed for fresh talent for businesses looking to grow and invest in their workforce. 

Why is this important? According To Faniro-Dada, Managing Director of Endeavour Nigeria, “The data is clear - Africa is the next digital growth frontier. The combination of our young and digitally savvy population, an emerging technology ecosystem and the impact of the COVID-19 pandemic on behaviours is set to trigger an inflection point in our digitisation journey. We have been excited by the increased levels of funding that our entrepreneurs are attracting, but we want to make it even easier for more investors to bring out their cheque books to catalyse the growth that we believe is pending.”

The year 2021 saw private investment in Africa hit a record high of $7.4bn, according to an annual report by African Private Equity and Venture Capital Association (AVCA). The report states, “Africa’s economies are leading as a region of resilience with vast potential”.

While there may be a wealth of opportunity, there are a number of risks which growth focused investors and businesses should factor into any expansion plans.

Top five business risks in post-pandemic Africa:

In this content series, RSM’s advisers, Phillip Kruger, RSM South Africa; Mphile Manana, RSM Eswatini; Odirile Setlhoka, RSM Botswana; and Titus Marago, RSM Eastern Africa, share their perspectives and expert insight on the different types of risks and how businesses can navigate these while exploring growth opportunities in Africa.

COVID-19 impact

As the fog begins to clear in a post-pandemic Africa, how are middle market businesses faring? In this informative article, RSM’s experts in Africa provide a snapshot view of how COVID has impacted business, as well as tips on how to stay resilient during uncertain times.

Political instability

Political instability can have a multifaceted influence over areas of business risk, such as financial and economic features of a country. RSM specialists in Africa discuss the challenges and risks associated with political instability in the region.

Unstable financial markets

According to recent studies, Africa’s economy is set to expand going forward, despite struggles to gather momentum in the wake of the pandemic. RSM’s experts in Africa discuss the current state of the region’s financial markets, as well as the challenges faced.

Protectionist laws

Recent years have seen populism, deglobalisation and protectionism on the rise, as countries fight for economic supremacy and erode global free trade in the fallout. In this insightful article, RSM’s specialists in Africa discuss how these global trends are affecting the region.

Infrastructure risks

With strong infrastructure, comes increased opportunity for social and economic transformation. In this article, RSM’s experts in Africa discuss the current infrastructural climate of the region and the challenges they have been seeing.