Three Emerging Trends to Shape Black African Markets

By Ecobank Research with Irene Gaitirira
Published November 18, 2017

Ecobank operates in Angola, Benin, Burkina Faso, Burundi, Cameroon, Cape Verde, Central African Republic, Chad, Congo (Brazzaville), Congo (Democratic Republic), Co^te d’Ivoire, Equatorial Guinea, Ethiopia, Gabon, Gambia, Ghana, Guinea, Guinea Bissau, Kenya, Liberia, Malawi, Mali, Mozambique, Niger, Nigeria, Rwanda, Sao Tome and Principe, Senegal, Sierra Leone, South Africa, South Sudan, Tanzania, Togo, Uganda, Zambia and Zimbabwe.A guidebook that provides expert knowledge and analysis on African markets for investors and businesses forecasts three key trends to characterise the market of Africa south of the Sahara over the next 12 months.

The 2017 edition of Fixed Income, Currency and Commodities (FICC) guidebook by Ecobank Research indicates an economic rebound in sub-Saharan Africa driven by a recovery in the region’s economic heavyweights–Nigeria and South Africa–and ongoing growth in the top performers–Ethiopia, Ivory Coast and Ghana.

Growth will be driven by a rise in oil production–notably in Ghana, Congo-Brazzaville, Nigeria and Angola–strengthening infrastructure investment across West and East Africa, and improved weather conditions which bode well for crops.

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Strengthening economic activity, plus a moderate improvement in oil and mineral prices, will help narrow the current account deficit, but pressure on sub-Saharan Africa’s currencies will remain.

The second emerging trend points to West Africa’s gas sector becoming a hive of activity in 2018 from Senegal to Angola, with the development of gas pipelines, floating liquefied natural gas (FLNG) platforms and major gas field projects.

EcoBank Research forecasts three key trends to characterise the market of Africa south of the Sahara over the next 12 monthsGovernments in the Gulf of Guinea and across West Africa have ramped up efforts to secure gas supply in order to boost domestic power generation and diversify their revenues away from crude oil.

Deregulating the gas market and allowing market-driven gas prices will be key to unlocking further gas infrastructure investment across the region.

The third trend suggests Fintech innovation in Africa picking up speed in 2018 buoyed by a new generation of Africans who are ‘digital natives’. The proliferation of tech hubs across Africa–notably in South Africa, Kenya, Rwanda, Nigeria, Ghana and Ivory Coast–will nurture the next wave of African start-ups and help connect them with investors.

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Digital innovation in black Africa is being driven by the explosion in mobile phone usage, enabling African consumers to leapfrog existing business models and technologies.

African Fintech firms are increasingly driving this innovation, deploying digital tools to build credit profiles for the previously ‘unbankable’, providing electricity to rural households that were previously off the grid, even using artificial intelligence to diagnose health problems remotely.

“The digital world moves apace, and so must we,” says Edward George, Head of Ecobank Group Research. “We think these three trends are strong evidence that Africa has weathered the storms of late and is very much on track for improved growth in 2018.”

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