- African Wealth: The Tenth Largest Economy in the World
- A Different Type of Oil and Diamonds
- An Irish Beer Finds Its Future in Africa
- An Inflection Point
- Looking East: The New Gold Rush
- Entrepreneurship Is Alive and Well in Africa
- Trade Not Aid
- The Need for Leadership
- Africa's Rise: Hidden in Plain Sight
- Inexplicable Optimism
- Rising Opportunities
An Inflection Point
Although Novartis has had a long presence in Africa, I had a chance to join senior executives from Europe in July 2006 for their first major meeting in Nigeria, recognition of the rising importance of the continent and the need for an on-the-ground understanding. "It may be at this moment in time we are coming to a kind of inflection point in the development of Africa," said Kevin Kerr, who was in charge of Novartis business in the region, during a meeting in the Little Crockpot restaurant in the Sheraton Lagos.
The Coca-Cola Company, which has been in Africa since 1928, has seen its business on the continent increase steadily over the past two decades, despite the ups and downs of individual countries, as shown in the following figure. The company now sells 93 million servings of its beverages every day across Africa, generating about $4 to 5 billion in system revenues for the company and its bottlers in 2006. The African business accounted for 6.5 percent of global sales by volume in 2006.
As a sign of Africa's rising development and importance, in June 2007 Coca-Cola relocated its African headquarters from Windsor, United Kingdom, to Johannesburg, South Africa. Alex Cummings, an African-born leader, was at the helm (see sidebar). Muhtar Kent, president and chief operating officer of The Coca-Cola Company, said of the move: "I believe that our business in Africa should be managed locally, by Coca-Cola associates who live and breathe the continent. Johannesburg is an ideal location for our new office since it has excellent business infrastructure, as well as good transport and communications networks with the rest of the continent."
It is not just large companies that are finding opportunities in Africa, but also visionary entrepreneurs. We discussed the successes of companies such as Bidco in Kenya and Innscor in Zimbabwe. In South Africa, Herman Mashaba founded Black Like Me in 1984 in Garankuwa, manufacturing hair and beauty products at night and selling them during the day. He built one of the most respected brands in the industry in South Africa. The business was brought to the brink of bankruptcy in a suspicious fire that destroyed his factory in 1993, but he rebuilt it from scratch and sold a majority stake to Colgate-Palmolive two years later. Two years after that, he negotiated to buy the business back. Today it is a multimillion-rand business, with products distributed throughout Africa and the United Kingdom. He is regarded as one of South Africa's most successful entrepreneurs.
Bill Lynch, CEO of South Africa's Imperial Holdings transport group, with annual turnover of R42.5bn ($6.2 billion), was born in rural Ireland. He came to South Africa in the 1970s with nothing, and built his own multimillion-dollar fortune while growing Imperial. Lynch, named Ernst & Young World Entrepreneur in 2006, weathered economic recession and a near civil war while growing the company, but expects more growth ahead. As he told the Financial Times in 2006, if South Africa grows at the expected rate of 6 percent, his business should grow at 15 percent to 20 percent over the next few years.13