With the growth rate of the food sector in developed markets trailing that see in emerging markets, investment firm Silk Invest has suggested that investors are increasingly looking to emerging markets in Africa for opportunities.
Here are some key facts on the economy, food industry and foreign direct investment in the region.
1. The population of the African continent is projected to overtake that of the developed world by 2050. In 2009, Africa accounted for 7% of the world’s population. This compared to the US, which accounted for 21%, and Western Europe, which accounted for 19%. By 2050, the population of Africa is expected to account for 14% of the global population, compared to the US at 12% and western Europe at 10%.
2. Over the last 20 years, the population of Africa has grown faster than any other region. In 1989, the population of Africa was 577m, by 2008 the population had increased to 913m people.
3.Gross domestic product (GDP) in both North Africa and Sub-Saharan Africa currently out paces average global GDP. In 2009, global GDP constricted by -2.9% compared to GDP of 3.3% in North Africa and 2.1% in Sub-Saharan Africa. In 2010, it is estimated that global GDP will grow by 2%, compared to estimated GDP of 4.1% and 3.7% in North and Sub-Saharan Africa respectively.
4. FDI in Africa is rapidly expanding. In 2000, FDI in the region totalled US$10bn, in 2005 that level had increased to $30bn and last year FDI in Africa rose to $53bn.
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5. The food industry in Africa is a growing sector. Average annual turnover growth, over a four year period, totalled 17.3% in Egypt, 16.6% in South Africa and 18.1% in the rest of Africa. Average earnings growth, again taken over a four year period, outpaced revenue growth at 22.1% in Egypt, 23.8% in South Africa and 19.8% in the rest of Africa.
For more on the opportunities afforded by the African food industry, click here to check out this month’s just the answer with Silk Invest CEO Zin Bekkali.
Sources: Silk Invest; The World Economy Historical Statistics, Maddison & Angus; World Bank; IMF.