By Adedapo Adesanya
The African Development Bank Group (AfDB) has urged entrepreneurs in Nordic countries and Ireland to make Africa their business and investment destination.
According to a statement, the call was made by the lender’s Chief Economist, Mr Kevin Chika Urama, on a spate of official visits to Denmark, Finland, Ireland, Norway, and Sweden between September 25 – 29.
He said Africa’s population boom is projected to make it the world’s most populous region by the end of the century, with up to 3.4 billion people offering huge business and investment opportunities to the rest of the world.
“With a population of more than 1.3 billion [currently], a youthful population of 600 million, rapid urbanization, and rising incomes of the middle class, Africa is the leading emerging market frontier,” he said.
According to Mr Urama, agriculture and energy in Africa offer huge opportunities for trade and investment with Nordic countries, as the size of the food and agriculture market in Africa will rise to $1 trillion by 2030 from $300 billion in 2022.
Speaking in Copenhagen, Denmark, during a meeting with businesspeople on 28 September, Mr Urama said that the African Continental Free Trade Area (AfCFTA), the largest regional bloc in the world in terms of the number of countries, is estimated at $3.5 trillion in market size.
“Danish businesses should seize these business opportunities and invest more in Africa,” said Mr Urama, who is also the Bank’s Vice President for Economic Governance and Knowledge Management, adding that bilateral trade between Denmark and Africa increased by 28.6 per cent between 2018 and 2022, from $2 billion to $2.6 billion and noted there was potential for growth.
“But this increase is insufficient in both value and relative terms. Between 2018 and 2022, total exports to Africa from Denmark represented on average only 0.3 per cent of Africa’s total global imports,” he said.
He said it was worrying that Denmark’s imports from Africa represent only 0.1 per cent of Africa’s total exports between 2018 and 2022.
“This needs to change given the huge potential and opportunities that African markets offer to Danish businesses for trade and investment and the strong partnership between Denmark and African countries,” he said.
Similarly, while addressing a business roundtable in Oslo, Norway, Mr Urama highlighted the low levels of trade between Norway and African countries, despite the enormous potential that African markets offer to Norwegian businesses.
Bilateral trade increased from $3.1 billion in 2018 to $5.2 billion in 2022, an increase of 68 per cent. Foreign Direct Investment (FDI) by Norway in Africa was estimated at $1.6 billion in 2021, a 12 per cent decline from 2020.
“Much needs to be done to improve trade and investment between Norway and Africa. Between 2018 and 2022, total exports to Africa from Norway represented on average only 0.4 per cent of Africa’s total imports,” he clarified.
Mr Urama made similar calls to investors in Ireland, Finland, and Sweden, encouraging them to seize investment opportunities in Africa, particularly in key areas such as green metals, such as lithium and cobalt, that will drive global market growth in clean technologies.
“The continent holds 80 per cent of the world’s platinum; 50 per cent of cobalt and 40 per cent of magnesium, as well as vast deposits of lithium and graphite,” he said.
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