Businesses upbeat on Africa recovery

Corporate leaders in Africa have expressed confidence in a rapid recovery for business on the continent in the first quarter of next year, a survey finds.

The business leaders are also upbeat on Africa's long-term economic growth as it emerges from the impact of the coronavirus, according to findings from the poll, which was conducted by Deloitte, a professional services company, and Africa CEO Forum, a platform for business meetings targeting private-sector investors and financiers from across Africa.

However, the respondents acknowledged that the slowdown in global economic growth will hurt their companies' domestic operations.

They point to the trend of digitalization as helping companies to ensure business continuity during the crisis, and see it as a central priority in their recovery plans.

The report said the youthfulness of Africa's population and the relative absence of technological legacy systems, which could create resistance to change, favor the faster adoption of innovation than in other regions.

The take-up of mobile-payment technology, with the widespread use of nano-savings and nano-credit solutions, is a good example, the report found.

Innovation is increasingly developed internally by companies that identify mobile and digital technologies as development priorities for the coming year, it said.

The report said the under-utilization of data represents real potential for accelerated growth for private-sector stakeholders, as innovation should enable data qualification, thus promoting their use, storage and sharing. In this way, companies can better serve customers and communities, it said.

Call for collaboration

While African business leaders are evidently convinced of the essential nature of the collection and use of such data, they express regret that too few initiatives are being developed in this area, the report said.

It said private-sector executives agree that there is a need to develop stronger collaboration between private and public stakeholders in innovation at the continental level in order to enhance Africa's attractiveness for innovation investment.

The business climate, regulations, infrastructure development－like the electrification of rural areas and establishment of data hubs－must be considered. The report said this would promote standardization and the creation of more favorable conditions for the development of new technologies on the continent.

Business leaders are also better prepared to manage risk. Some 41 percent of executives report that they have set up a formalized risk-appetite framework internally, aligned with strategy, and operationally implemented throughout the company.

"The coronavirus crisis is a reminder that there are many exogenous risks which can affect companies and come on suddenly. Hence they need to be adequately prepared for," the report said.

Sixty percent of leaders think that the coronavirus will have a long-term, more structural impact on corporate governance that will transform them and equip them better for future crises.

For 37 percent of business leaders surveyed, Cote d'Ivoire, Ghana, Kenya, Rwanda and Senegal are the most attractive countries for investment in 2020.