Why invest in COMESA? Because COMESA, just as it is the case in the rest of Africa, currently offers and is projected to continue offering top returns on investment in all sectors. This is the bottom-line. COMESA is one of the building blocks of what is now considered to be the last investment frontier, Africa.
Many have already said it: not investing in Africa at this time is like missing out on Japan and Germany in the 1950s and Southeast Asia in the 80s. According to the World Bank, Africa could be on the brink of an economic take-off, much like China was 30 years ago and India 20 years ago.
A Growing Consumer Market
Africa is now witnessing a commodity-boom which is driven by diversifying economies, a growing middle class of over 313 million consumers and consumer spending breaking through the one trillion dollar mark, and projected to reach USD 1.4 trillion by 2020. Furthermore, the number of African cities with a population over three million is expected to more than double from 16 in 2012 to 34 in 2030. Investors in Africa are now increasingly market-seeking. While opportunities in the natural resource sectors remain huge, new opportunities in all other sectors are emerging. Opportunities from different sectors complement each other and together give rise to new ones.
According to Ernst and Young’s Africa Attractiveness Survey 2014, three predominantly consumer-facing sectors — financial services, TMT and RCP — have been the primary beneficiaries of FDI projects. The financial services sector was the largest recipient of FDI projects in Africa between 2007 and 2013. Foreign banks and other financial services companies are either launching or expanding operations in Africa to tap the growing but under-serviced financial services market. In 2013, for example, UK banking company Standard Chartered announced that it will invest USD 100 million in Africa, with the aim of doubling the size of its business by 2018. Growing investor interest is not just limited to foreign companies. Regional banks and other financial services firms in Africa are ramping-up their presence across the continent.
Global Access to a Large Diversified and Resilient Market
Because of COMESA agreements, today Seychelles is exporting its tuna to Egypt and they are buying it duty free says Hon. Danny Faure, Seychelles’ Vice President. COMESA’s most obvious benefit to investors is indeed its fully-functional free trade area offering duty-free access to 15 of its 19 Member States which together are located on strategic world trade routes which as the Suez Canal, the Red Sea, the Mediterranean Sea, and the Indian Ocean, and in close proximity to global markets include Europe, the Gulf, Asia and the rest of Africa. COMESA provides a larger market space for businesses to operate and where procedures and policies are being further simplified and harmonized.
A Tripartite Free Trade Area is currently being negotiated between COMESA, the Southern African Development Community (SADC) and the East African Community (EAC) bringing the total number of states to be included to 26, covering a market of close to 620 million inhabitants, and a GDP of almost USD 1.2 trillion.
Investment opportunities in all sectors abound throughout the COMESA region. Opportunities exist both at national and regional levels. While COMESA regional projects are more concerned with infrastructure needed to facilitate investment and trade across various Member States, national projects can be found in the sectors of road, air, sea, and rail transport infrastructure, energy, mining, ICT, real estate, agriculture, agro-processing industries, fisheries, and livestock, tourism, manufacturing, logistics, hospitality, trade, and more.
As said by H.E. Cheick Diarra, Former Prime Minister of the Republic of Mali “Organisations like COMESA provide opportunities that go beyond countries or regions because the stakeholders go well beyond borders”.