A survey of more than 350 business leaders across five of some of Africa’s fastest-growing economies reveals a high degree of optimism – 81 per cent report that the business situation in their country is good or satisfactory, despite ongoing and well-documented challenges
The expansion and improvement of physical and digital infrastructure and the growth of customer demand are some of the principal reasons for this underlying business optimism and anticipated growth. This is despite enduring challenges within the economic environment and a pressing need for upskilling employees within the workforce.
Produced by The Africa List, a membership community of Africa’s rising private sector leaders, and developed in partnership with The Wheeler Institute for Business and Development at London Business School, The Africa List Business Barometer aims to shed light on five economies that often go under-reported in global and African private-sector studies.
The Africa List Business Barometer leverages the on-the-ground insights of The Africa List’s unique membership to offer thought-provoking perspective on subjects related to skills, leadership, and perspectives on how companies do ‘good’ beyond their bottom line.
Nieros Oyegun, head of network at The Africa List, said, “Through this research, we want to uncover the factors for business success on the ground in these high-potential growth economies, and in doing so, reframe the well-trodden macroeconomic views held on the region. The Africa List Business Barometer also provides a platform for hundreds of our members, all exceptional business leaders, to shed light on the realities of doing business in their markets, and showcase their work, businesses, and economies beyond The Africa List community.”
A total of 357 business professionals operating in the Democratic Republic of Congo (DRC), Ethiopia, Tanzania, Uganda and Zambia answered questions on business confidence and investment, future economic conditions, finance, principal risks and opportunities.
While there are slight differences across countries and industries, there is generally strong optimism, with 87 per cent of respondents predicting that the business environment will remain the same or improve over the next year. In addition, 85 per cent intend to maintain or increase the level of investment in their business in the same period, translating their optimism into positive actions.
Need to address the challenges
This optimism is despite persistent challenges, including regulatory challenges and unstable political environments. For instance, although DRC’s respondents acknowledge the challenges of the political environment in the past year, they are the most positive about the improvement in business conditions in the year to come.
Skills shortages are identified as a constraint to growth, with nearly a third of participants expressing concerns in this area. In interviews conducted alongside the survey, respondents report channelling considerable investment in upskilling their workers.
Indeed, financial services and telecommunications stand out as the sectors considered to most noticeably be ‘doing good,’ with mining also featuring significantly positively. This may be due to the higher-quality jobs, salaries and worker benefits associated with employment in industries and sectors of the type.
Elias Papaioannou, co-academic director of the Wheeler Institute for Business and Development Professor of Economics at London Business School and Hal Varian Visiting Professor of Economics at the MIT Department of Economics commended the report for offering a practical and accessible resource with which to stimulate and inform the discussion.
“For Africa to enter a sustainable development path, its businesses need to flourish. While governments, local and foreign, and international institutions have a crucial role, African entrepreneurs, business leaders, and innovators will spur employment, investment, and opportunity. It is vital that Africa maintains the successes of the past decades and does not revert to another period of conflict, mismanagement and authoritarianism. It is, therefore, encouraging that the views of the business leaders recorded by The Africa List Business Barometer are optimistic, even when operating in challenging environments.”
