The report, ‘Trade with Africa’, published by Barclays Plc April 2, 2012, said despite the opportunity Africa presents, the potential of the region is far from being realised by British companies.
The research, which includes a survey of 250 UK companies currently exporting to Africa, found that the vast majority (92%) of these companies believe “there is opportunity for UK businesses in Africa today”, including around a third (29%) that believes there is ‘huge opportunity’.
Supporting this positive sentiment, Barclays said two thirds of the businesses surveyed believe this opportunity will grow in the next five years, as well as a similar number believing that they will increase the amount they export to Africa.
Kah Chye Tan, Global Head of Trade and Working Capital at Barclays, said that while the findings appeared broadly positive, he strongly believes the potential for UK producers in Africa was still being significantly underestimated.
“For many exporters Africa is the final frontier, and the vast and diverse nature of the continent and its people can make trading with Africa seem simply too much of a challenge. However, the infrastructure across many of Africa’s largest economies is improving rapidly, and I encourage all UK businesses to view Africa as a fast growing new market to be explored,” Kah Chye Tan stated.
The reputation of British goods and services, growing infrastructure spending across Africa and an expanding middle class were cited in the report as key areas that provide the biggest opportunity for UK businesses on the continent.
The survey also found that while exporters were optimistic about African trade, 70% of the businesses also describe doing business in Africa as challenging, including almost a third that believe it is ‘very challenging’.
“Corruption remains the biggest single issue for UK exporters, followed by poor payment systems and infrastructure,” it adds.
Chye Tan noted “With more than 50,000 employees on the ground in Africa, we know very well the challenges that businesses face, but also the success so many of our clients have experienced when they do begin supplying African companies.”
By Ekow Quandzie