Investing in Africa in the logistics sector in 2024: an opportunity for international players
Despite economic uncertainties and supply chain disruptions globally, it is interesting to note that more than 61% of international players in the logistics sector plan to invest in Africa in 2024. This data comes from a survey carried out by the analysis and research company Transport Intelligence (TI), in partnership with the Kuwaiti logistics group Agility.
According to the report titled “Agility Emerging Markets Logistics Index 2024”, 31.8% of executives surveyed plan to maintain their investment and expansion strategy in Africa, while 6.6% plan to reduce their activities in certain African markets . It is therefore clear that Africa continues to attract the attention of international businesses, despite the challenges and potential risks.
One of the reasons for this growing interest in Africa is the sharp increase in trade flows between Asia and the West African coast. Indeed, containerized imports into African countries increased by 6.7% during the first seven months of 2023 compared to the same period in 2022, and by 10.1% compared to 2019. This economic dynamism contributes to position Africa as a promising logistics market.
However, despite this optimism, half of the executives surveyed expect a global recession in the coming years. This caution can be explained by various factors, such as international trade tensions, fluctuations in commodity prices and the potential effects of climate change. It is therefore essential for companies to take these elements into account in their investment strategy in Africa.
When it comes to the most attractive countries for investment in Africa, India, Europe and North America rank ahead of China. Indeed, more and more business leaders are considering moving their production to these regions. Furthermore, 40% of managers believe that their companies will be less dependent on China in the next five years.
In conclusion, despite economic and logistical challenges, Africa continues to attract the attention of international players in the logistics sector. The ever-increasing trade flows between Asia and Africa, as well as the region’s economic growth potential, are all factors that encourage companies to consider investments in Africa in 2024. However, it is important to be prudent and consider potential risks, such as global economic recessions and climate change, when developing investment strategies.
