With a population exceeding 1 billion, the African continent is home to six of the top 10 fastest growing countries in the world, and U.S. exports to sub-Saharan Africa now top $21 billion a year. Though there are always challenges in doing business outside of the U.S., opportunities abound for those small businesses that are properly prepared.
David Bekele, president of Elado International, a Chicago-based export, projects, logistics, and investment management and consulting firm specializing in Africa and the Middle East, recommends starting with the Commerce Department Website on Doing Business in Africa. BE spoke with the native of Ethiopia to pick his brain on how to best position U.S.-based companies to take advantage of the opportunities that exist in Africa:
Which countries are most conducive to doing business with people from outside the continent?
Bekele: I would encourage U.S. entrepreneurs to look at Africa in terms of regional blocs with varying degrees of integrated economies, customs, and cultures. In East Africa, Kenya, Tanzania, and Rwanda are very conducive for doing business with partners from outside the continent. In Southern Africa, economic powerhouse South Africa is the gateway to entering markets in the region. Namibia, Botswana, Zambia, and Mozambique have proven that mutually beneficial agreements in various sectors will bear fruit. Lastly, in West Africa, Ghana, Senegal, Gambia, and Gabon have fast-growing economies and are actively seeking U.S. partners.
What are the services or goods that are most in demand?
The agro industry is in very high demand, as are infrastructure, telecommunications, medical services, and hospitality. Elado International and Urban Clean Energy Ventures have invited a selected group of top corporate executives from small and medium-sized U.S. companies to explore investment opportunities in Tanzania, South Africa, Namibia, and Senegal this year.
What are the biggest challenges with U.S.-based entrepreneurs trying to conduct business in these countries?
In general, knowing the culture and understanding how to do business is important. In America, we have an instant society. Africa moves at its own rhythm and speed with the important dynamic of personal trust and confidence serving as the lynchpin for success. With patience, perseverance, and the right partners, the challenges of corruption, infrastructure, and bureaucracy can be overcome.
The news reports a lot of problems in countries such as Somalia and Uganda. Doesn’t that make it hard to convince American entrepreneurs to seek out business on the continent?
As you know, there are more than 50 countries in Africa. As you can see, we have identified 12 countries that we firmly believe are very secure and easy to do business and invest in. First of all, do your homework. Reputable companies can help you navigate how to successfully do business in Africa.