UK Meets EGYPT: The Potential Gateway for UK's Expansion into Africa
In 2022, Africa’s economic landscape stood out favorably on the global stage, demonstrating resilience in the face of obstacles like tightening global financial conditions and exacerbated supply chain disruptions resulting from the Russian-Ukrainian war, unlike many other regions worldwide.
Growth is expected to rebound to 4% by the end of this year and stabilize at 4.3% in 2024, showcasing Africa's resilience to shocks.
1. AFRICA AT A GLANCE
I. The Business Titans of Africa
– There are around 345 companies in Africa that generate yearly revenue of $1 billion or higher.
– They jointly generate over $1 trillion in revenues.
– Out of the 345 companies, 230 were founded by local entrepreneurs in African countries.
– These major corporations are present in all sectors across the continent.
II. The Status of Africa’s Trade Affairs
– The trading correlation between Africa and the rest of the world is uneven. Africa mainly exports basic commodities and imports mostly manufactured goods.
– In 2021, the amount of manufactured goods imported by Africa was triple the amount of goods exported.
– Africa’s merchandise exports in 2022 comprised mostly of primary goods, accounting for 77% of the total.
III. FDI Inflows Across Africa
Over the past 5 years, foreign direct investment (FDI) inflows have increased in four African regional economies. Although intraregional investment has grown, it still makes up a small portion of all projects; intraregional greenfield projects showed a slight increase from 13% to 15% in 2022. While international project finance deals for Africa declined by 47% in value in 2022, the number of projects increased by 15%. On the other hand, Egypt has witnessed a substantial surge in FDI, with cross-border (M&A) transactions driving a twofold increase in overall investment, reaching a total of $11 billion. This increase in FDI has also resulted in a doubling of greenfield projects in the country. Conversely, Morocco has seen a minor dip of 6% to $2.7 billion in FDI flows.
III. Africa’s Natural Treasures
In 2018, the estimated value of Africa’s natural capital was $6.2 trillion.
It is worth noting that Africa has 65% of the world’s arable land and significant freshwater resources, which makes up 10% of the planet’s internal renewable freshwater source.
