Africa ranks second in size and population but has a surprisingly short coastline. Regarding growth and profit, the continent has many beached whales. These industries have huge chances for expansion. Many African nations are rolling out structural change programs. They are focusing on profitable businesses. This will increase output and create more jobs.
Some sectors have not only met but exceeded their growth goals. They are now key drivers of economic progress. Online sports betting is thriving. It is an important factor in digital transformation. Also, it aids in enhancing financial inclusion on the continent. Ten key industries are driving Africa’s economic growth and development. They promise productivity, spark innovation, and create jobs.
Let’s explore the booming industries in Africa that are attracting global interest.
Fishing Industry
Africans started commercial fishing around 1500. This growth is fueled by the rich marine life along Africa’s East and West coasts. Today, the continent accounts for 8.1% of global fish production, up from 5.9% in 1950. Factors behind this rise include:
- EEZs now expand to 200 miles.
- New tech in the marine sector comes from increased investment and better policies.
- Global attention to food security is increasing.
- Cases of undernourishment are rising.
- Developing countries want to tap into Africa’s fishing potential.
According to the World Bank, fishing contributes 24% to Africa’s GDP. The industry supports 12 million jobs, of which 59% are held by women in processing and fishing. Fishing started as a way to survive. Now, it’s a competitive and profitable industry. This change is due to new global eating habits.
A key report indicates that ‘opaque fishing practices’ hold back Africa’s blue revolution. Two-thirds of African countries miss out on this revolution, even though they are near the sea.
The industry has challenges like illegal trade, unregulated fishing, and unreported catches. These issues hurt growth and hold back progress. In the future, Africa will work on improving surveillance tech. This aims to stop those draining its valuable water resources.
Textile Industry
Africa’s textile industry has done well since before colonial times. It has grown to be an important part of the economy. Some areas grew with various sectors. Others had small industries that emerged fast. These industries had an edge due to the many low-wage daily workers. The growing population on the continent made this workforce plentiful. Heinrich Barth, a well-known German traveler in Africa, describes the wealth of these industries vividly. Barth explained that textile work was done after the harvest. This timing led to unmatched quality and skill. The items were sold in markets from modern Senegal to Chad and into Europe.
Following independence, Africa’s textile industry developed in two major phases of growth.
PHASE 1: Import substitution (Late 1950s-1980s)
Phase 1 involved import limits, taxes, extra charges, and bans on certain goods. The WTO didn’t exist yet, so these policies were easy to enforce. This sparked rapid growth in the 1960s and 1970s. Yet, the phase ended due to oil price spikes and economic shifts.
PHASE 2: Expanding exports through Export Processing Zones (from the 1990s onward).
Phase 2 began when several sub-Saharan African countries set up export processing zones. This aimed to increase trade.
These zones were designed for production that would only be exported. These EPZs did not include domestic consumers and investors. Instead, they provided incentives to foreign investors to increase FDI in the sector.
In recent years, Africa has focused on innovation in the textile industry. This approach aims to improve production and compete globally. South Africa has grown in technical textiles. They now make hemp products for aeronautics. H&M has opened textile mills on the continent. This is because there are many workers available and a good manufacturing environment.
Africa now supplies nearly 10% of the world’s cotton. Togo’s Plateforme Industrielle d’Adetikopé has boosted the local textile industry. It aims to turn 50,000 tonnes of cotton fiber into garments worth $70 million. Similar economic zones are also being set up in Cotonou, Benin, and Nkok, Gabon. The projects aim to build self-reliance in the textile industry. This will boost its global standing.
Finance Industry
Since the 1980s and 1990s, Africa’s financial sector has experienced significant expansion. Reforms have improved banking, regulation, and markets. This means more people can get loans, helping businesses to grow. They also keep the sector up to date with global trends.
The industry has shown great strength, especially in insurance. About 69% of companies have adjusted to maintain profits after COVID. More than 50% of financial institutions plan to work with tech companies, not compete. With more digital tools and better rules, Africa’s financial sector will keep growing.
Transport Sector
Africa’s development relies heavily on its transportation sector, especially as urbanization increases. Logistics account for over 70% of product costs in Africa, while in the U.S., it’s only 6%. This is why better transport systems matter for startups and big investors like Google.
The continent’s air, sea, rail, and road networks are growing, but development is uneven. Most highways are in Central Africa. Ports manage 10% of global trade, and cargo volume has tripled in ten years. Yet, they need major upgrades to meet rising demand.
COVID-19 slowed revenue, but the sector is set to grow more than double. This growth makes transportation a key driver of Africa’s future economy.
Healthcare Sector
Africa’s healthcare industry has changed significantly in the last ten years. This shift is due to government partnerships, private companies, NGOs, and local communities. To improve patient care, we must invest in hospitals, drug production, and skilled medical staff.
By 2030, the industry is projected to surpass $250 billion, though a 14% resource gap still exists. Africa accounts for 25% of global diseases. Both infectious and chronic illnesses are growing. Stronger teamwork between medical institutions is crucial.
Technology is important. Drones carry medicine to remote areas. Solar-powered cribs aid in caring for newborns with jaundice. Also, governments are rolling out policies to improve healthcare access and protect everyone.
Conclusion
Africa’s climate is changing. Stable politics, new tech, and a bigger population are paving the way for growth. Africa has a hand in nearly every expanding industry. It seeks to use its resources without depleting them entirely. Growing stakeholder interest is driving increased investment across these industries.