A DIVERSE CONTINENT WITH VARIED OPPORTUNITIES

Africa holds myriad opportunities for experienced exporters. The continent is home to seven of the world’s 10 fastest-growing economies, yet not a single African country ranks among Wisconsin’s top 30 export destinations. (The highest-ranking in 2020 was South Africa at #32, importing $100 million worth of Wisconsin goods.) Many African countries have sizable populations (with megacities such as Lagos, with 15 million people, and Cairo, with 10 million people), and the middle class is growing across the continent. Within two years, the continent is expected to be home to more than 100 cities with more than 1 million people each, and the total population will surpass 1.4 billion. Although factors such as language barrier, cultural differences and logistical considerations can pose challenges when exporting to African markets, promising opportunities exist for companies that can transcend these barriers.

The Wisconsin Economic Development Corporation (WEDC) is organizing a virtual Global Trade Venture to markets throughout Africa from Dec. 6-17, 2021, to help Wisconsin companies connect with export partners. Though necessitated by the pandemic, the virtual format poses a unique opportunity for WEDC to search across a wide range of markets to find the best-matched potential partners for participating companies. Wisconsin’s trade representatives are located in 13 African countries and can facilitate in many more, giving this virtual trade venture a much broader scope than a typical in-person trade venture, which focuses on one or two markets.

Although the larger markets will be a primary focus during the “matchmaking” conducted for each participating company, potential partners may be located in any market served by Wisconsin’s African trade representative: Algeria, Angola, Botswana, Democratic Republic of Congo, Comoros, Côte d’Ivoire, Egypt, Ethiopia, Ghana, Kenya, Lesotho, Liberia, Madagascar, Malawi, Mauritania, Mauritius, Mayotte, Morocco, Mozambique, Namibia, Nigeria, Rwanda, St. Helena, Senegal, Seychelles, Somalia, South Africa, Swaziland, Tanzania, Tunisia, Uganda, Zambia or Zimbabwe. Not every country in Africa is a good target market for every exporter; with the broad scope of this virtual trade venture, Wisconsin’s trade offices in Africa can help exporters connect with prospects in markets that might otherwise be overlooked.

To adapt to the pandemic, WEDC converted its Global Trade Ventures into a virtual format that consists of online meetings between Wisconsin companies and potential customers, distributors and other prospective partners in international markets. After learning about your company and products, WEDC’s in-country trade representatives will bring potential partners and distributors to you. All participants need to do is show up ready to make their pitch and ask questions to determine if the potential partner is a good fit.

Because of the time difference, meetings will be held over the span of a two-week period, at times that are the morning in Wisconsin and the afternoon in African markets. Companies in the following sectors are especially encouraged to participate:

• Agri-business
• Automotive manufacturing
• Consulting (particularly business process outsourcing)
• Education (particularly technical and vocational education and training)
• Energy/power solutions
• Health care, medical devices and consumables, and related training
• Information technology and related management consulting
• Mining equipment and technology
• Security
• Water technology and security

OUTLOOK FOR AFRICAN MARKETS

Africa is growing out of its role as a primary resource supplier and is quickly becoming a knowledge-based economy, driven by a youthful entrepreneurial class. The African Continental Free Trade Area (AfCFTA), an agreement among 55 African countries that took effect this year, creates a single continental market for goods and services, with the goal of accelerating intra-African trade and boosting Africa’s trading position in the global market. Taken as one market, AfCFTA is the world’s largest by geography and is expected to overtake China in terms of population to become the world’s largest by 2023. The African continent’s manufacturing output is expected to grow significantly due to the new opportunities created by this agreement.

Particular sectors of opportunity include:

• Health care and medical devices. Africa’s population is expected to grow to 2.4 billion by 2050. Africa bears 25% of the global disease burden and is served by merely 2% of the world’s health care workforce. As the population grows, there will be an increasing need for high-quality, accessible health care. Currently less than half the population has access to modern health care facilities. Africa’s pharmaceutical market is worth approximately $30 billion, and medical devices approximately $4 billion. Needs include digital health, diagnosis and patient services, medical equipment and devices, education and specialty architecture.
• Information technology. Africa’s e-learning market reached $2.2 billion in sales in 2020, and its financial technology market will soon reach $150 billion in annual revenue. The market for general IT services to support company growth in South Africa alone is presently $20 billion.
• Food processing and agricultural technology. Agriculture is Africa’s largest economic sector, representing 15% of the continent’s GDP, or more than $105 billion annually. It is highly concentrated, with the top 10 countries generating 75% of the output. While more than one-quarter of the world’s arable land lies on this continent, it generates only 10% of global agricultural output. The growth of the middle class is leading to a diversification of dietary requirements. Agricultural technologies of all kinds, specialized equipment, crop and husbandry science, and a wide range of other industry support are all promising areas for export sales. Food processing technologies are also in demand as the middle class grows.
• Mining equipment. Mining companies continued to enjoy gains in commodity prices in 2020, assisted by weaker emerging-market currencies. This improved profitability resulted in increased gains and distributions to shareholders, a near doubling of taxes to governments, and strong balance sheets. These gains were achieved despite higher operating costs and decreased production due to the pandemic. Africa’s mining sector has outperformed the global mining index, and is expected to rebound in 2021. The continent has approximately 18% of the world’s new exploration.

MAKING BUSINESS CONNECTIONS VIRTUALLY

During the trade venture, participants will be scheduled for one-on-one meetings with potential partners in the target markets. These partners are identified based on each participating company’s specific goals and objectives. Each trade venture participant will receive a market assessment that details considerations to keep in mind when introducing their product or service into the markets where potential partners are located—including existing trade relationships, logistical issues to address, and nuances in the way business is conducted. WEDC has eyes and ears on the ground, in the form of Wisconsin’s in-market authorized trade representatives—thus making it easier for Wisconsin companies to find local partners they can trust, taking some of the guesswork out of launching in a new market or growing exports within the market. With all your appointments arranged for you, you can focus on business rather than logistics and scheduling.

WEDC’s in-market trade representative will screen businesses for the best matches to your firm’s target partner, whether that’s a distributor, agent or end-user customer. Participating in a virtual trade venture is much less expensive than traveling to the market for an exploratory visit. In addition, the virtual format allows for “visiting” multiple different cities and countries without the time and expense of air travel. With a series of virtual meetings, you will be able to evaluate multiple candidates and select the top ones to visit and engage in more in-depth conversations once international business travel