Many years ago, sitting in my office at the global headquarters of Fortune #1; Walmart, I began actively pursuing effective strategies and ways to advance trade (import/export) with Africa through commodity and product inclusion into the existing global supply chain conversations.
The reality is that Africa and Africans are not as involved and engaged to the degree that they could be – in fact I like to say that sometime if feels like Africa “didn’t exist” in leading GLOBAL COMMODITY EXCHANGES – Ask any major buyer around the world if they have ever bought DIRECTLY at scale from the region and the answers might surprise you as well.
The current landscape is such that external Actors continue to play “middlemen role”. They entire the region to source and aggregate and introduce into the global system.
This on the surface feels ok excerpt for the fact that Africa mostly never gets any credit on how it continues to power and fuel the economy of other nations.
The emergence of the African Continental Free Trade Agreement (AfCFTA) if executed effectively will shift the dynamics of Global Trade as it relates to Africa.
During our AfCFTA Roundtable event the former World Bank Chief Economist on Africa also shared his thoughts on the clear Vision of the AfCFT
So why is this the case?
Visibility – there is limited visibility into what Africa has to offer global buyers. I remember having a conversation with the CEO of Walmart and this reality set in based on what we discussed. No Buyer is going in blindly into the region without on the ground support and traceability.
The work remains on the African side to organize and represent the interest of sectors. Global Buyers need to assess the overall capacity and strength of supply chains to understand where those supplies exist and can be delivered in a consistent way. Africa’s Local business players are not visible to the world.
During our Trade with Africa Business Summit, the CEO of Walmart also shared his thoughts on the Power of Trade.
Transparency – The movement of commodities including natural resources like diamonds and precious metals and the price markup along the chain is not transparent. Global buyers want traceability and transparency.
In this brand showcase with Westrock Coffee we share the importance of traceability within the global supply chain.
is no standardization. A fully mature supply chain has linkages baked in with each players stepping forward to fulfil their roles meeting international standards.
Connectivity – If you are not connected to the global discuss you can not participate in global opportunities. It is why members of my network gain access to opportunities because the platform connects them to key stakeholders around the world.
Education – The local, regional and global markets require different levels of education. When you win in your local market you still need additional information to prepare to work with global players.
Legal Structures – Informal trade is prevalent. Formalizing trade has to be underpinned by legal structures. I expect this area to mature over the next 10 years.
Quality – Just as China was perceived 30 years ago to be an haven for low quality products – Africa is in the same position now has manufacturing continues to take root. I like to say – begin where you are and innovate over time. Africa also has opportunities to leapfrog if region have the bold leadership for that.
Exploitation – The history of Africa is rooted in this and hence there are trust issues that would continue to impact business dealings. African’s largely do not trust external players – they might work with you but be assured that they are always looking behind their backs to understand what they might be “giving away”. This is perhaps the most sensitive topic and the business community must strive to build long term trust to succeed.
Lack of Investments – Since there is little visibility to the investment opportunities in the region they are not able to attract the right type of attention. Going from dependency on Foreign Aid to Foreign Trade will activate investment dialogue that will surely drive transformation on the continent
The Last Mile – Agriculture is the Future of Africa however the ability to move products from farm to market is still missing critical elements of Branding, Marketing, Distribution to global chain.
Written by Coach Toyin Umesiri – Nazaru Founder & CEO
