associate publisher and director of marketing: amy...

Vice President, Publisher: Tim MooreAssociate Publisher and Director of Marketing: Amy NeidlingerWharton Editor: Yoram (Jerry) WindAcquisitions Editor: Martha CooleyEditorial Assistant: Pamela BolandDevelopment Editor: Russ HallOperations Manager: Gina KanouseDigital Marketing Manager: Julie PhiferPublicity Manager: Laura CzajaAssistant Marketing Manager: Megan ColvinFront Cover Design: MVB DesignManaging Editor: Kristy HartProject Editor: Betsy HarrisCopy Editor: Keith ClineProofreader: Kathy RuizSenior Indexer: Cheryl LenserSenior Compositor: Jake McFarlandManufacturing Buyer: Dan Uhrig

© 2009 by Pearson Education, Inc.Publishing as Wharton School PublishingUpper Saddle River, New Jersey 07458

Wharton School Publishing offers excellent discounts on this book when ordered in quantityfor bulk purchases or special sales. For more information, please contact U.S. Corporate andGovernment Sales, 1-800-382-3419, [email protected]. For sales outside theU.S., please contact International Sales at [email protected].

Company and product names mentioned herein are the trademarks or registered trademarksof their respective owners.

All rights reserved. No part of this book may be reproduced, in any form or by any means,without permission in writing from the publisher.

Printed in the United States of America

Second Printing September 2008

ISBN-10 0-13-233942-0ISBN-13 978-0-13-233942-1

Pearson Education LTD.Pearson Education Australia PTY, Limited.Pearson Education Singapore, Pte. Ltd.Pearson Education North Asia, Ltd.Pearson Education Canada, Ltd.Pearson Educatión de Mexico, S.A. de C.V.Pearson Education—JapanPearson Education Malaysia, Pte. Ltd.

Library of Congress Cataloging-in-Publication Data

Mahajan, Vijay.

Africa rising : how 900 million African consumers offer more than you think / Vijay Mahajan.

p. cm.

ISBN 0-13-233942-0 (hbk. : alk. paper) 1. Africa—Commerce. 2. Africa—Economic condi-tions. 3. Investments, Foreign—Africa. 4. International business enterprises—Africa. I. Title.

HF3876.5.M34 2009

382.096—dc22

2008012190

Preface: Consumer Safari

I have to admit that until a few years ago, I was guilty of overlook-ing Africa. My book on emerging markets, The 86% Solution,included only a few African examples. As a professor of marketing atthe University of Texas, I have extensive experience working withcompanies in Latin America. I have traveled and lectured extensivelyin Asia and the Middle East. Like most scholars in the developedworld, however, I saw Africa more as a charity case than a marketopportunity. I was wrong, and this book is here to set the recordstraight.

It is particularly surprising to me that I failed to recognize thestory in Africa because I remember when India was discussed in thesame way. As Ramachandra Guha recently wrote in a book review inthe Financial Times, “Western writers of the 1960s warned their read-ers that India was a losing proposition, the laboratory, as it were, offailed experiments in democracy and nation-building.”1 He could bewriting about Africa today. In fact, one of the reasons I started writingabout opportunities in emerging markets was because of a conversa-tion I had with a colleague for a panel considering how we could stopthe developing world from “begging.” As the son of an entrepreneur,I found this shocking and insulting. I knew that entrepreneurship isalive and well in India. But when I told colleagues a decade or twoago that India would be an important global market, they wereincredulous. They are incredulous no longer.

I have experienced the transformations in India firsthand. I wasborn in Jammu City in the state of Jammu and Kashmir a few monthsafter Mahatma Gandhi was assassinated and India became a republic.I became part of a generation that Salman Rushdie called “Midnight’sChildren,” referring to those who lived through the transformationaltime after the independence of India at midnight on August 15, 1947.In 2002, I had the opportunity to return to India as dean of the IndianSchool of Business in Hyderabad. I saw how a country that had beenwritten off as a charity case was now seen as a powerful emergingmarket.

Now I see the same view of Africa. Despite all the attention it hasreceived for its social, medical, humanitarian, and political chal-lenges, it is still undervalued as a consumer market. I set out to rectifymy own lack of knowledge about the continent and to understand themarket opportunity it presents—in all its rich complexity and wealth.I traveled thousands of miles across Africa and met with or inter-viewed leaders of major African companies, smaller entrepreneurs,and Asian and Western firms with long experience on the continent. Ihave had the opportunity to meet some truly extraordinary and cre-ative business leaders. I feel blessed for the opportunity to do this inthe autumn of my life. I learned important lessons from these manyteachers, which I share in this book.

As I was finishing this book, President George Bush announcedin February 2008 the launch of five funds through the U.S. OverseasPrivate Investment Corporation, totaling $875 million, for investmentin Africa. On the eve of his trip to Benin, Tanzania, Rwanda, Ghana,and Liberia, he stated a conclusion that I had reached in my ownjourneys through Africa in the preceding years. “This new era isrooted in a powerful truth: Africa’s most valuable resource is not itsoil, it’s not its diamonds, it is the talent and creativity of its people.”The true wealth of Africa is its more than 900 million consumers, andits countless entrepreneurs and business leaders who are alreadydemonstrating the wealth of the continent by building successfulenterprises. If you look beyond the headlines, these individuals arepropelling the rise of Africa. They are building businesses,economies, and societies. They are the hidden natural resource thatmay present greater opportunities than oil or minerals in the longrun.

I am not a political scholar. I am not an economist. I am a market-ing professor, so my focus is on the market opportunity. There willsoon be a billion consumers on the continent of Africa, and this is oneof the fastest growing markets in the world. Every day, they need toeat. They need shelter. They want education for their children. Theywould like to have soaps to wash their clothes. They desire cellphones, metal roofs for their homes, televisions, music, computers,movies, bicycles, cosmetics, medicines, cars, and loans to start busi-nesses. They celebrate marriages, births, and religious holidays andcommemorate death.

PREFACE xi

xii AFRICA RISING

I have sought to learn as much as I possibly could about theAfrican market—what it offers, how it is structured, and its potential.Others have looked at Africa through a political lens, some haveengaged in economic analysis, some have examined its complex his-tory, and others have looked at medical or social challenges. A fewhave even started telling the stories of specific African businesses.But my focus is on understanding the continent through the perspec-tive of the consumer. What is the African market? What opportunitiesdoes it offer? How are companies recognizing and realizing theopportunities in Africa’s rising?

Many tourists come to Africa every year to see the big gamethere—the elephants, lions, and rhinos. But I came for a differenttype of big game. I was seeking out the successful enterprises that areidentifying and capitalizing on the market opportunities, and seekinglessons from those that are not so successful, too.

In Nairobi, Maserame Mouyeme of The Coca-Cola Companytold me how important it is “to walk the market.” Then, in Harare, Ifirst heard the term “consumer safari” in a meeting with Unileverexecutives. This is what they call their initiatives to spend a day withconsumers in their homes to understand how they use products.Years after I started on this journey, I now had a term to describe thequest I was on. I was on a consumer safari. The market landscape thatis Africa is every bit as marvelous and surprising as its geographiclandscape. It presents as big an opportunity as China and India. Onthe following pages, I invite you to come along on this safari. I think itwill change your view of Africa, as it has changed mine, and perhapsyour view of where the future global market opportunities—andfuture wealth—can be found.

Vijay Mahajan

University of Texas at Austin

March 2008

Baking Bread in Zimbabwe

Africa has more than 900 million consumers. Despite the chal-lenges, every day they need to eat. They need clean water. They needshelter, clothing, and medicine. They want cell phones, bicycles, com-puters, automobiles, and education for their children. Businesses arealready seizing these opportunities to build markets across Africa.

The headlines from Zimbabwe when I visited in July 2006 weredismal. Inflation was above 1,000 percent. Unemployment was over70 percent.1 Gas stations had not had official supplies of fuel for years,so people carried cans of gas in their trunks for long trips. Borrowingrates ran as high as 400 percent to 500 percent. A combination of thepolicies of President Robert Mugabe and Western sanctions hadbrought the nation to its knees.

When I arrived at the airport in Harare, it was a ghost town. Giftshops and car rentals were closed. One line snaked away from the ex-change window where an ATM door was flung open, exposing its in-terior machinery. There used to be 20 flights a week here. Now therewere three or four. Tourism revenues in Zimbabwe dropped from$340 million in 1999 to $98 million in 2005.2 An advertisement for cel-lular network operator Econet Wireless at the arrival doorway in theairport seemed jarringly out of place, with its bold letters proclaiming“Inspiration is all around you.” There was little inspiration here.

Outside, half a dozen taxis sat by the curb. Their engines were off.Gasoline was scarce. The drivers leaned against the rail, even after theKenya Airways flight discharged a few passengers from Nairobi. Idletaxis at an idle airport are the clearest indication of an economy that iscollapsing upon itself.

1

3

4 AFRICA RISING

Yet even here there were market opportunities. A few days later,in downtown Harare, I met an accountant for a company that makesfiberglass roofing. Kizito Ntoro was sitting in the late morning at atable in a food court on the ground floor of the shopping mall at 105Robert Mugabe Road. He had just purchased a hamburger from theSteers restaurant, one of about a half dozen offerings at the row ofstores along the wall in front of him. But his reason for stopping forfast food would be totally foreign to a restaurant manager in the developed world. He was here because his electricity was out thenight before, so he and his family had no dinner. Their lights were out.They couldn’t cook. They just went to bed without eating hot food. Sohe stopped at the restaurant before an 11 a.m. meeting. In a countrywhere power is unreliable, a power outage is an occasion to eat out andan opportunity for entrepreneurs to build businesses (not to mentionbooming sales of generators and solar cells).

Innscor, which operates the Steers restaurant chain in Zimbabwe,got its start in the restaurant business with a small chicken restaurantin Harare in 1987. When Innscor built its first Chicken Inn, there wasno fast food in the country. KFC (Kentucky Fried Chicken) had triedsetting up shop but closed down. Most people thought it was a foolishidea. Chicken Inn started turning a profit in six months. Now Innscorhas developed a full food court with a set of restaurants that cuts acrossdemographic segments—from the daily bread of its basic Bakers Innto Steers to Pizza Inn and the upscale Nandos chicken restaurants (seeExhibit 1 of the insert). Innscor replicated this concept in more thana dozen countries across Africa. The company has also moved into dis-tribution for U.S., European, and local companies in Zimbabwe andother countries, manufacturing appliances and franchising grocerystores. It forged an alliance with ExxonMobil for its On the Run con-venience stores. In 2005, the company posted revenue growth of 278percent and profit growth of 246 percent. By 2007, it was the tenthlargest company in southern Africa, excluding South Africa, with amarket value of $203 million. (There is an active stock market in Zim-babwe.)3 All the news out of Zimbabwe was not bad.

Entrepreneurs have had to adapt to political and economic chal-lenges. When Nigeria banned imports on cheese, Innscor spent nineyears perfecting its own recipe to make mozzarella in Nigeria taste likeEuropean imports. In Zimbabwe, they have gone into businesses that

CHAPTER 1 • BAKING BREAD IN ZIMBABWE 5

most restaurant companies in developed countries would never haveimagined, like crocodile farms. The need for foreign exchange in Zim-babwe’s shaky financial system took Innscor first into the tourism busi-ness with its Shearwater Victoria Falls operation. When increasingeconomic uncertainty undermined tourism, Innscor moved into croc-odile farms. The company whose core business is bread, chickens, andburgers was raising more than 50,000 crocodiles a year for global mar-kets on Lake Kariba in Zimbabwe when I visited. Innscor became oneof the biggest producers of crocodile meat and skins in the world andbrought in much-needed foreign exchange. When the marketchanges, entrepreneurs adapt.

Innscor is just one of many entrepreneurial firms I have had theopportunity to study in diverse countries across Africa as I have soughtto understand the African opportunity and how successful companiesare capitalizing on it. These companies span industries from consumergoods to alcohol and soft drinks to metal roofing to airlines to retail-ers. These firms are challenging the view that Africa is a charity case.They are one of the driving forces of Africa’s rise. If there are oppor-tunities in a country such as Zimbabwe, where political mismanage-ment has led to a prolonged economic crisis, or Rwanda, Congo, andSouthern Sudan, where new enterprises are springing from the ashesof horrific violence and genocide, imagine the opportunities to createwealth in more stable and well-managed countries in Africa. Success-ful companies across the continent have recognized the African op-portunity that is sometimes buried in a flood of bad news that streamsout of the continent.

Whatever its challenges—and there are many, from diseases suchas AIDS and malaria to corruption to all-out war—Africa containsmore than 900 million consumers. Every day, they need their bread.In Harare, I watched the conveyor belts of the bread factories ofInnscor’s Bakers Inn churn out more than 50,000 loaves of bread dailyas workers in white coats inspected the line. Workers mixed massivepots of yeasty-smelling dough and monitored brown loaves rising on aFerris wheel and running through ovens on a conveyor belt. The bak-ery faced challenges of finding good wheat, fluctuating diesel supplies,and government-controlled pricing. The afternoon I visited, the linehad to be shut down because of a lack of diesel. But more fuel was onits way, and they would run all night to meet demand. People lined up

6 AFRICA RISING

at the shops in the morning. These loaves of bread serve the lowestend of the consumer market. Costs are unpredictable. Prices are fixedby the government. Innscor has refined its business processes, usedmeticulous cash management, and harnessed the power of entrepre-neurship to achieve better profit margins despite higher costs andlower effective prices. The most amazing thing is that their profit mar-gins were better than they had ever been. As one manager said at thebakery, “We are not bakers; we are entrepreneurs.”

Although it was hard to imagine the situation in Zimbabwe couldget worse than when I visited in July 2006, it did. By early 2008, an-nual inflation was estimated at more than 8,000 percent (although un-official estimates were as high as 25,000 percent). An estimated 4million people, one-third of the population, had fled the country bymid-2007.4 To address widespread hunger, the government fixedprices for essentials products at a point where producers said theycould no longer earn a profit. Executives were arrested for failing toimplement the price controls. Entrepreneurs stepped up informal im-ports from neighboring South Africa. After President Robert Mugaberequired all businesses to yield 51 percent of their ownership to blackZimbabweans (called “indigenization”), J. Heinz sold its interest in aZimbabwe company in September 2007.5

Even so, companies were still investing billions of Zim dollars inbuilding their brands. From banks to cellular companies to milk pro-ducers, companies were reworking their taglines and logos to redirector reinvigorate their Zimbabwe businesses. Kingdom Bank, foundeda dozen years earlier, proclaimed, “Kingdom’s time has come!”6 AnApril 2007 ranking by African Business of the top 50 companies insouthern Africa (excluding South Africa) included 19 Zimbabweanfirms in areas from food to retail to seeds to reinsurance. In July 2007,large South African retailers, including Massmart (owner of Makro inZimbabwe), Edgars, OK, and Pick ‘n Pay affirmed their commitmentto keeping their operations open in Zimbabwe.7 Even thoughsqueezed by runaway inflation and government price controls, the re-tailers continued to express hope about the future of the country.

Most surprising, Zimbabwe is also attracting new investors. De-spite worsening conditions, foreign direct investments rose from $4


million in 2003 to $103 million in 2005. With companies significantlyunderpriced and a belief that the country will ultimately turn around,many investors believed it was worth the risk. At the urging of in-vestors, Imra Assets Management of South Africa, which categorizedZimbabwe as a “frontier” market, nonetheless launched a Zimbabwe-focused investment fund in March 2007. It had set a goal to raise $10million by the end of the year, but had already brought in $11 millionjust a few months later. The fund is investing in a number of enter-prises, including Innscor.8 These investors believe, that with plans andpatience, Zimbabwe’s prospects, like the bread in Innscor’s bakeries,will continue to rise.

As this book was going to press, there were historic changes un-derway in Zimbabwe. In elections in March 2008, Robert Mugabe’sparty lost control of the house of Parliament for the first time since thecountry’s independence from white rule in 1980. His loss to MorganTsvangirai marked the weakening of his control of the country.Although these changes increased the threat of violence, they also sig-naled the most dramatic political change in the nation’s recent history.

African Wealth: The Tenth LargestEconomy in the World

Africa is a continent full of surprises. The fact that people werebaking and buying bread in a country that was in economic free fall isjust one snapshot of the continent’s hidden opportunities. Looking atthe bigger picture of Africa also reveals some surprises. If Africa werea single country, according to World Bank data, it would have had $978billion total gross national income (GNI) in 2006. This places it aheadof India as a total market. Africa would show up as the tenth largesteconomy in the world (see Table 1-1). In fact, this places Africa aheadof every one of the vaunted BRIC economies (Brazil, Russia, India,and China) except for China. Of course, Africa is not one country, aswe consider in the next chapter, but it is richer than you think.

8 AFRICA RISING

A Different Type of Oil and DiamondsIs the wealth of Africa all from diamonds and oil? Perhaps, but not

always the types of diamonds and oil that you might think. Althoughmining and oil are important industries historically, there is muchmore to the African opportunity than natural resources. While petro-leum production has grabbed the headlines, Bidco Oil Refineries,Inc., in Kenya has created a business with more than $160 million(Ksh12.8 billion) turnover, based in large part upon a different kind ofoil: cooking oil. Bidco began producing oil in 1991 at its Thika factory.Through very effective marketing and packaging, with products sizedfor any budget, it became the leading manufacturer of edible oil, fats,and soaps in east and central Africa. Bidco understands the market,from the low-income customers in Kibera who buy oil in small pack-ages to the upper-income consumers who log on to its “Jikoni.com”website to download recipes. (The site attracted more than 11,000registered users in mid-2006, including members of the diaspora

TABLE 1-1 Africa Is the Tenth Largest Economy in the World

1 United States $13.4 trillion

2 Japan $4.9 trillion

3 Germany $3.0 trillion

4 China $2.6 trillion

5 United Kingdom $2.4 trillion

6 France $2.3 trillion

7 Italy $1.9 trillion

8 Spain $1.2 trillion

9 Canada $1.2 trillion

10 Africa $978.3 billion

11 India $906.5 billion

12 Brazil $892.8 billion

13 Republic of Korea $856.6 billion

14 Russian Federation $822.4 billion

15 Mexico $820.3 billion

Source: Gross National Income, 2006, World Bank, http://siteresources.worldbank.org/DATASTATISTICS/Resources/GNI.pdf

http://siteresources.worldbank.org/DATASTATISTICS/Resources/GNI.pdf

http://siteresources.worldbank.org/DATASTATISTICS/Resources/GNI.pdf


community outside Kenya.) Bidco built over 51 percent market sharein Kenya, and the company exports oil, detergents, and other productsto more than a dozen African countries, including Tanzania, Uganda,Rwanda, Burundi, Ethiopia, Sudan, Eritrea, Zambia, Malawi, Mada-gascar, Democratic Republic of Congo, and Somalia. Not all the valuable oil in Africa comes out of the ground.

In South Africa, companies are mining a different kind of “dia-mond,” the so-called Black Diamond, an emerging middle-class seg-ment that is driving economic growth. Discussing this new segment,Melanie Louw, an economist for ABI, a bottler of Coca-Cola bever-ages in South Africa, noted that the “Black Diamond” segment hascreated a fundamental shift in the economy. “This has had a multipliereffect that has boosted the economy up to the point I believe that oureconomy has structurally changed,” she said in an interview in her of-fices in Johannesburg in 2006. “We have lifted up to a whole newrealm of economic growth.” The study by the University of CapeTown’s Unilever Institute that identified this Black Diamond segmentcalled it “the most exciting market opportunity in our history.” It is an-other sign of Africa’s rise.

Although South Africa’s market is farther along the curve thanmost of sub-Saharan Africa, the roughly 400 million people in the mid-dle segments of the entire African market (Africa Two) are a growingopportunity everywhere in Africa, as we consider in Chapter 3, “ThePower of Africa Two.” Some marketers break South Africa intolifestyle segments (LSMs), on a scale of 1 to 10. They have had to re-calibrate their scales over the past five years, as LSM 5 has moved upto consumption patterns that were once associated with higher seg-ments.

In December 2007, Cape Town hosted the first “lifestyle festival”for the Black Diamond segment (followed by similar festivals in Jo-hannesburg and Durban in 2008). The festivals celebrated what or-ganizers call the “Afropolitan” products and brands that cater to thelifestyle of South Africa’s black middle class (www.blackdiamonds-festival.co.za). This emerging South African middle class, which isgrowing at an estimated rate of 30 percent per year, is also driving uphousing prices in the country.9 “The past ten years have been the mostexciting years we have had,” said Louw. “We’ve seen amazing changesin consumer behavior. In terms of lifestyle, trends such as health and

www.blackdiamondsfestival.co.za

www.blackdiamondsfestival.co.za

wellness, and even packaging preferences have changed completely.The economy structure and labor structure have changed pro-foundly.”

Although the top 4 companies on the 2007 list of the largest Africacompanies as ranked by African Business are in metals and mining oroil and gas (Anglo American plc, Bhp Billiton plc, Anglo AmericanPlatinum Corp. Ltd., and Sasol Ltd.), among the top 20 companies areconsumer goods (SABMiller plc), telecom (MTN Group Ltd., Oras-com Telcom, Itissalat Al Magrib, Telkom SA), banks (Standard BankGroup Ltd., FirstRand Ltd., Absa Group Ltd.), and real estate com-panies (Liberty International Plc). There is still tremendous interestin Africa’s natural resources, but could cooking oil and Black Diamondconsumers be the oil and diamonds that will be most significant toAfrica’s future rise?

An Irish Beer Finds Its Future in AfricaIs Guinness an Irish or African brand? In the last six months of

2006, global sales of Diageo’s Irish stout Guinness were down about 4percent. They were even falling in Ireland, due to changes in con-sumption patterns as customers spent less time in pubs. But sales out-side of Ireland were growing by 4 percent to 5 percent—especially inAfrica. Chief executive Paul Walsh said in July 2007 that the companywould expand sales in Africa to counter declines in its domestic mar-ket.10 It is clear its future may not lie in the Irish pub but in the smallbars in Lagos.

Thanks to a long presence in Nigeria and astute advertising, manyNigerians don’t even see Guinness as an Irish brand. It has been sucha long and dominant presence that it is considered domestic. When anIrish beer has become African, and when the future growth of thebrand rests on expanding sales on the African continent rather than inIreland, there is clearly something shifting in the world. Not only that,but a Nigerian immigrant was elected as the first black mayor of anIrish town in 2007. Rotimi Adebare was named head of the town ofPortlaoise, an hour outside of Dublin. This is a sign of the growingreach and prominence of the African diaspora. It is getting very hardto tell where Ireland ends and Africa begins.11

10 AFRICA RISING


When I met Eric Frank of Saatchi and Saatchi in a small booth ata crowded restaurant at the airport in Cape Town, he said he was gladthat someone from the United States was finally paying attention towhat is happening in Africa. Frank and his colleagues had developedthe legendary Michael Power advertising campaign, an action herowho helped build Guinness into a “Lovemark” in Nigeria and othercountries. Saatchi and Diageo had recognized the potential in Africalong ago, which helps explain why Guinness has such a strong pres-ence across sub-Saharan Africa now. Its fortunes have risen withAfrica.

Other companies are stepping up their presence in Africa.Unilever, facing increased competition and declining profits in theUnited States and Europe (where sales growth fell from 5 percent in1998 to 0.7 percent in 2004), announced plans to step up its businessin the developing world, including Africa, where it is already firmly es-tablished.12 Nestlé, caught between forecasts of growth of only 1.5 per-cent annually in developed markets and its target of 5 percent to 6percent organic growth, announced plans in 2006 to step up opera-tions in West Africa and other developing markets to make up the dif-ference.

An Inflection PointAlthough Novartis has had a long presence in Africa, I had a

chance to join senior executives from Europe in July 2006 for theirfirst major meeting in Nigeria, recognition of the rising importance ofthe continent and the need for an on-the-ground understanding. “Itmay be at this moment in time we are coming to a kind of inflectionpoint in the development of Africa,” said Kevin Kerr, who was incharge of Novartis business in the region, during a meeting in the Lit-tle Crockpot restaurant in the Sheraton Lagos.

The Coca-Cola Company, which has been in Africa since 1928,has seen its business on the continent increase steadily over the pasttwo decades, despite the ups and downs of individual countries, asshown in the following figure. The company now sells 93 million serv-ings of its beverages every day across Africa, generating about $4 to 5billion in system revenues for the company and its bottlers in 2006.

The African business accounted for 6.5 percent of global sales by vol-ume in 2006.

As a sign of Africa’s rising development and importance, in June2007 Coca-Cola relocated its African headquarters from Windsor,United Kingdom, to Johannesburg, South Africa. Alex Cummings, anAfrican-born leader, was at the helm (see sidebar). Muhtar Kent, pres-ident and chief operating officer of The Coca-Cola Company, said ofthe move: “I believe that our business in Africa should be managed lo-cally, by Coca-Cola associates who live and breathe the continent. Jo-hannesburg is an ideal location for our new office since it has excellentbusiness infrastructure, as well as good transport and communicationsnetworks with the rest of the continent.”

12 AFRICA RISING

1600000

1400000

1200000

1000000

800000

600000

400000

200000

01987 20062003199919951991

Source: The Coca-Cola Company

Unit case volumegrowth '000 over 20years

Volume growth over 20 years

Coca-Cola growth in Africa


Alex Cummings: Bringing Coca-Cola Home to Africa

Liberian-born Alexander B. Cummings Jr., president of the AfricaGroup of The Coca-Cola Company, helped carry the headquartersto South Africa from London in 2007, a sign of the improvementsin infrastructure and growing opportunities for business on thecontinent. “This move demonstrates The Coca-Cola Company’sconfidence in the future of Africa,” said Cummings during an inter-view with the author in August 2007. “Furthermore, the continent’simproved economic growth rate encourages us to plan for futureexpansion.”

“On a per-unit basis, Africa is the third most profitable market inthe world,” he said. “The African market is quite attractive for thecompany and for most multinationals if they look at it with the rightlens. Most people only see the negatives of Africa. You have to getbeyond the perception to see the opportunities. We estimate that350 million to 500 million people could potentially be the marketfor our products. That is a lot of people.”

“The returns in Africa are as good as, or better than, they are in alot of BRIC counties [Brazil, Russia, India and China] in themedium and short term. And the African market is not as compet-itive as BRIC countries. We have a significant opportunity to shapebeverages in Africa and see the results. Beyond the business re-turns, there is the opportunity to impact and influence communi-ties. For all those reasons Africa is as attractive, maybe moreattractive in the medium term, than BRIC countries—but, ofcourse, I am a bit biased.”

The Coca-Cola Company is not put off by markets fragmentedacross more than 50 countries. “That can be a challenge, but ourbusiness model is one of producing as close to the market as possi-ble,” he said. In Liberia, a single bottling plant distributes throughthe country, and in countries such as Mali or Cameroon, The Coca-Cola Company has partnered with other beverage makers to enterthe market. Although huge differences exist across Africa, there arecommon challenges across these markets. For the company, build-ing distribution, developing the right portfolio of beverages (in-cluding juice and water), building the capacity of its people, and

It is not just large companies that are finding opportunities inAfrica, but also visionary entrepreneurs. We discussed the successesof companies such as Bidco in Kenya and Innscor in Zimbabwe. InSouth Africa, Herman Mashaba founded Black Like Me in 1984 inGarankuwa, manufacturing hair and beauty products at night and sell-ing them during the day. He built one of the most respected brands inthe industry in South Africa. The business was brought to the brink ofbankruptcy in a suspicious fire that destroyed his factory in 1993, but he rebuilt it from scratch and sold a majority stake to Colgate-Palmolive two years later. Two years after that, he negotiated to buythe business back. Today it is a multimillion-rand business, with prod-ucts distributed throughout Africa and the United Kingdom. He is regarded as one of South Africa’s most successful entrepreneurs.

Bill Lynch, CEO of South Africa’s Imperial Holdings transportgroup, with annual turnover of R42.5bn ($6.2 billion), was born in ru-ral Ireland. He came to South Africa in the 1970s with nothing, andbuilt his own multimillion-dollar fortune while growing Imperial.Lynch, named Ernst & Young World Entrepreneur in 2006, weath-ered economic recession and a near civil war while growing the com-pany, but expects more growth ahead. As he told the Financial Timesin 2006, if South Africa grows at the expected rate of 6 percent, hisbusiness should grow at 15 percent to 20 percent over the next fewyears.13

14 AFRICA RISING

engaging in community development are common themes acrossAfrica.

Cummings joined the company in 1997 in Nigeria and became thefirst African to lead Coca-Cola’s operating unit in Africa. He earnedhis Bachelor’s degree in finance from Northern Illinois Universityand a Master’s degree in finance from Atlanta University. Heworked for The Pillsbury Company for 15 years before joining TheCoca-Cola Company. Most of the company’s top leadership inAfrica is from the continent. “It isn’t easy finding Africans, but youcan,” Cummings said, “and if you look to the diaspora, you can findeven more.”


Looking East: The New Gold RushAsian governments and companies are recognizing the opportu-

nity in Africa’s rise. One crisp morning in May 2006, I drove throughthe archway of “China Mart,” a sprawling wholesale metropolis in Jo-hannesburg. Gold was what first brought Europeans to Johannesburgduring the gold rush of the 1800s. Now, in the Crown Mines sectionof the city, there is a new gold rush, centered around the consumergoods of China Mart. This wholesale mall contained 126 shops sur-rounded by a gate and heavy security sporting padded vests (as well assigns prohibiting firearms). They were not guarding gold. They wereguarding stores filled with inexpensive clothing, luggage, shoes, andelectronics from China, which drew retailers from South Africa andsurrounding countries. In one store, Tom Fang offered flip-flops froma large box for just 2.90 rand (about 30 cents). They would retail onthe shelves of stores in Zimbabwe, the Congo, or Angola for about 8to 10 rand (just over $1). For many villagers, this will be their first pairof shoes. “They are very well made,” he pointed out.

Chinese merchants and products are evident across Africa, fromlow-cost televisions and other appliances to generators to clothing andshoes. Astute Chinese peddlers and retailers are selling Ramadanlanterns and prayer carpets in Egypt. Egyptians shake their heads thatthey are buying these holy items from the Chinese, but the price isright. Jincheng motorcycles race across the roads of Nigeria. Indianand Pakistani traders in the Asian market area of Johannesburg sellleather, clothing, and other wares. The same scene is repeated at ElHamiz in Algiers, Moncef Bey in Tunisia, and many other parts ofAfrica I visited. Chinese stores can be found in the oldest and holiestplaces in Morocco, lining the Derb Ghalef and Derb Omar market ar-eas in Casablanca. At night, hawkers are selling shoes, clothes, andtoys in the street. In the Moroccan souks, you can buy inexpensive pi-rated goods from software to clothing. A knock-off pair of Ray-Bansunglasses that I had seen for $120 in a formal market was on sale forjust $5 by informal traders. Pirated movies were retailing for about $1.

China’s trade with Africa has risen from about $10 billion in 2000to more than $55 billion in 2006.14 (China’s trade with India, by con-trast, was less than half as large, at $25 billion in 2006.) Chinese PrimeMinister Wen Jibao forecast that trade with Africa would rise to $100

16 AFRICA RISING

billion by 2010.15 Although China has become second only to theUnited States as the largest importer of oil from Africa, nudging outJapan, it is far ahead of the United States in exports to Africa. Egyptexpects China to replace the United States as its top trading partnerby 2012.16 In a 2007 report, “Africa’s Silk Road: China and India’s NewEconomic Frontier,” World Bank economist Harry Broadman calledthe growing African trade and investment by China and India, partic-ularly in sub-Saharan countries, “one of the most significant featuresof recent developments in the global economy.”17 With growing invest-ments in Africa by India and China, will the West be left behind?

The African continent is looking east, as can be seen in the flightpaths of Kenya Airways and other African carriers. Like neural path-ways, the passenger and freight routes reflect the new thinking of Asiaabout Africa and vice versa. When I flew from Lagos to Nairobi onKenya Airways in July 2006, I found out that half the passengers werecontinuing on to connecting flights to Asia and the Middle East. Tra-ditional flight paths head into Europe, recognizing the continent’scolonial past. But the future can be seen in the routes from Nairobi toGuangzhou, Mumbai, and Bangkok. Billboards and full-page ads fromDHL in major African publications, discussing importing cell phonesfrom China, proclaimed, “No one knows China like we do.”

A Sino-African summit in 2006 brought representatives of almostevery African country to Beijing, a demonstration of how importantChina and Africa have become to one another. China pledged $5 bil-lion in loans and credits to Africa during the summit. And ChinesePresident Hu Jintao reciprocated with an eight-nation tour of Africain January 2007 (visiting Cameroon, Sudan, Liberia, Zambia,Namibia, South Africa, Mozambique, and Seychelles). India alsoorganized an India-Africa summit in New Delhi in April 2008. MajorIndian companies such as Tata, Mahindra, Kirloskar, and Ranbaxyhave set up operations in Africa and are achieving high levels ofgrowth. In May 2008, Bharti Airtel, India’s leading mobile operator,made a multibillion dollar bid for the control of South African mobilecompany MTN.

With so many opportunities at home, why are Indian and Chinesecompanies here in Africa? China and India can recognize the Africanopportunity because they have lived through it. In speaking with lead-ers of Indian companies who are active in Africa, I often heard the


comment that this market seems familiar. Although some of the inter-est from Asia in Africa has been fueled by Africa’s abundant natural re-sources—and there is even concern expressed about a new wave ofcolonialism—the Chinese, Indian, Japanese, and Korean companiesin Africa also recognize the potential of the market. The demograph-ics of Africa and challenges are not so different from those at home.They have seen the rise of their markets and expect the same in Africa.

Entrepreneurship Is Alive and Well inAfrica

At a lecture I gave to a group of entrepreneurs at the Lagos Busi-ness School in 2006, the question came up once again: What about therole of politics in business development? This is a natural question,and the political environment can have a tremendous positive or neg-ative impact on business development. This can be seen in the seriousrioting in Kenya over the presidential elections in December 2007, asI was finishing this book, which killed more than 1,200 people and dis-placed more than 300,000. Political rivals Mwai Kibaki and RailaOdinga ultimately negotiated an end to the conflict through a power-sharing agreement. (Despite these problems and their impact on thetourist industry, business bounced back quickly. The planned IPO ofSafaricom in April 2008 sparked an “IPO fever,” which attracted manyfirst-time investors such as kiosk owners and taxi drivers.) Certainly,more stable governments, good economic policies, and pan-Africaninitiatives such as the New Partnership for Africa’s Development(NEPAD)—as well as private initiatives such as the Ibrahim Founda-tion’s governance prize—are having a beneficial impact.

The African business environment is continuing to improve. A2006 report from the World Bank’s International Finance Corporationconcluded that Africa had moved from last place to third for improve-ments in ease of doing business. (Although the rate of improvementwas high, the highest-ranked country on the continent for ease of do-ing business was South Africa, ranked 29th in the world.) Countriessuch as Tanzania, Ghana, Nigeria, and war-ravaged Rwanda wereamong the most improved. At least two-thirds of African nations had

18 AFRICA RISING

achieved at least one positive reform.18 Among the improvements arebetter governance, the deepening of democracy, cancellation of thedebts of 14 countries, signs of reductions in tariff barriers, and posi-tive African state interventions in Sudan, Côte d’Ivoire, and theDemocratic Republic of Congo.

Haiko Alfeld, director for Africa of the World Economic Forum,noted in 2006 that the continent has “emphatically and irreversiblyturned a corner.” African Development Bank president DonaldKaberuka said in a summer 2007 interview in the new publication,African Banker (the publication of which is also a sign of the growthof banking and investment), the economic climate for Africa “is at itsbest in 30 years.”19

However, entrepreneurs and successful businesses are not waitingfor governments to get their acts together. These entrepreneurs havebuilt their businesses through the twists and turns of economic, polit-ical, and military unrest. It requires great flexibility. When the Niger-ian government banned imports of furniture and clothing, retailerPark n Shop quickly went into the furniture manufacturing business.It replaced an entire floor of imported furniture in its Lagos store withthe products of its own domestic manufacturing. When governmentrestrictions on gasoline all but shut down gas stations in Zimbabwe,they converted themselves to restaurants. Small entrepreneurs in Vic-toria Falls turned their private homes into gas stations, making runsacross the border to neighboring countries for cans of petrol.

The entrepreneurial spirit is alive and well in Africa. Entrepre-neurs solve problems. Take away electricity, and they sell generatorsand inverters. Take away a stable financial system, and they make theirmoney on speculating on foreign currency. Take away their employ-ment, and they set up kiosks in the street. Entrepreneurship and thedevelopment of consumer markets may be a more clean, stable, andpowerful driver of long-term progress than political reform. ProfessorPat Utomi of the Lagos Business School once suggested, only partly injest, that if all the oil in Nigeria were given to the soldiers and politi-cians on condition that they would leave the nation alone, the nationwould be better off.20

African countries have proven remarkably resilient. Idi Amin’s repressive regime in Uganda drove out not only Indians but also many


of their businesses, including Kakira Sugar Works, founded by Muljib-hai Prabhudas Madhvani. He had arrived in the country from India in1912 and set up a trading firm in Jinja. The Madhvani Group was nationalized, and all Asians were expelled by Amin on August 5, 1972.The company’s production continued to decline until 1983, when itwas shut down. After Amin’s overthrow, the new Ugandan govern-ment invited the Madhvani Group back into the country in 1985 in apublic-private joint venture, and Madhvani Group acquired 100 per-cent ownership of Kakira Sugar Works in 2000. When it needed morepower, the company began to construct a 20-megawatt power plant,which will allow it to burn sugar byproducts and sell energy back intothe national grid. When this cogeneration power project is completedin 2009, electric power sales will exceed sales of sugar. It was a long,hard road, but the business has come back stronger than ever.

Africa’s success in spite of politics is not so different from the storyof India’s rise. A few years ago, a poster at the World Economic Fo-rum in Davos summarized the nation’s progress: “In ten years—threeelections, three governments toppled—one direction.” Although weoften emphasize the way that politics affect business, remember thatbusiness affects politics, and market development has a stabilizing in-fluence on the economy. While politicians look to change regulationsand charitable organizations look to make up deficiencies, entrepre-neurs create wealth. They ask: What are the opportunities?

Trade Not AidAfrica is receiving unprecedented attention from the West for its

health, political, and humanitarian crises. Philanthropists and celebri-ties have been crisscrossing the continent drawing global attention toAfrican challenges. The musician Bono, in a special issue of VanityFair that he co-edited in July 2007, wrote that “Africa is the provingground for whether or not we really believe in equality.” Many impor-tant African initiatives are playing a vital role in drawing attention tothe plight of Africa’s most vulnerable populations. But an unfortunatebyproduct of these campaigns is that they also reinforce a perceptionthat Africa is nothing but a continent of war, disease, and begging

20 AFRICA RISING

bowls. This makes it easier to overlook the business opportunities thatare also there, and growing.

Although charity is important, it is not enough. Africa, like manyemerging economies, has serious problems that cannot be ignored bybusinesses operating there. Companies such as The Coca-Cola Com-pany, Unilever, Novartis, and many others are leading the way in ad-dressing disease, poverty, corruption, and other challenges. Some ofthese activities, such as distribution of condoms to prevent AIDS, areeither the result of corporate citizenship or enlightened self-interest. No company can stay in business for long anywhere withoutbeing concerned about the problems facing its employees and cus-tomers. This makes corporate social responsibility essential.

Africa’s challenges, like any consumer needs, can also create busi-ness opportunities. The lack of reliable electricity in many parts ofAfrica has created a market for generators and solar cells. Unstable fi-nancial systems have led to systems for bartering cell phone minutes,microfinancing, and cell-phone-based banking. Health problemsfrom AIDS to malaria have created demand for new treatments,generic drugs, testing equipment, and insurance. Concern about theenvironment has led to opportunities in eco-tourism. The challengesoften require blended solutions of public and private cooperation,leading to successful businesses that address real societal needs whilebuilding viable long-term economic value.

Where African nations have been able to create positive and sta-ble governments, their economies have flourished—countries such asBotswana, Mozambique, Mauritius, and even Rwanda, which is bestknown in the West for chaos and genocide.21 Rwanda’s leaders haveannounced aggressive plans to raise per-capita GDP from $230 to$900 by 2020, using information technology to transform the nationinto an “African Singapore.”22 Despite the dire situation in Sudan’swestern province of Darfur, the country is one of the fastest-growingeconomies on the continent, and multibillion-dollar office towers, ho-tels, and other additions to the skyline of Khartoum are inviting com-parisons to Dubai.23 Next door in Somalia, while the war-torn capitalof Mogadishu is a focus of international concern, Somaliland in thenorth is thriving and stable. Through setbacks, wars, and turmoil, theoverall market development of the continent has moved in one direc-tion—rising.


The Need for LeadershipCeltel founder Mo Ibrahim recognized the power of entrepre-

neurship, as well as government leadership, in transforming Africa.He built Celtel, one of Africa’s most successful start-ups and largestindigenous fortunes, at a time when few recognized the potential ofthe African cell phone market. Then he used his wealth to establish anannual $5 million prize, plus $200,000 for life, for retired African lead-ers who rule well and then stand down. This award is larger than theNobel Peace Prize. (In many countries, retired leaders received nobenefits, increasing the incentive for corruption to ensure security af-ter leaving office.) The first prize was awarded in 2007 to Mozam-bique President Joaquim A. Chissano, who retired in 2004 afterhelping to end a 16-year civil war in his country. Ibrahim also createdthe Ibrahim Index of African Governance to rank the quality of gov-ernance in sub-Saharan nations (see sidebar).24 He is demonstratinghow entrepreneurial success can become a driver for political and social development.

Mo Ibrahim: Africa Is Open for Business

Celtel founder Mohamed Ibrahim demonstrates the virtuous cycleof investment in building businesses in Africa, and the impact of ex-patriates in recognizing opportunities there. “All my life I havebeen working in the domain of mobile communications,” he said inan interview with the author in August 2007.25 “I am an African. Ialways felt that Africa has received very bad press – with civil wars,no rule of law, and diseases. It really has a bad image, which I thinkis not justified. Yes, we have all these problems, but Africa is a verybig place. There are 53 countries, and maybe there are severe prob-lems in four or five countries. And even if you go to Khartoum, youwould be amazed to know that it is part of Sudan.”

On the other hand, he pointed out that this negative perception isnot all bad from a business standpoint. “In business, when there isa gap between reality and perception, there is good business tobe made.”

22 AFRICA RISING

The Sudanese-born Dr. Ibrahim earned a Bachelor’s degree inelectrical engineering from the University of Alexandria in Egypt,a Master’s degree from the University of Bradford, and a Ph.D. inmobile communications from the University of Birmingham in theUnited Kingdom. After serving as an executive with British Tele-com, where he helped establish Britain’s first mobile network, in1989 Mo Ibrahim founded MSI (Mobile Systems International), aworld leader in radio planning, software, and consultancy. In 1998,he launched Celtel International, which became one of Africa’sleading telecom companies. Celtel was a company with global stan-dards for customer service but also “an African company.” He re-fused to pay bribes and created a system for good governance. Hehad to set up generators, use batteries, and build the communica-tions backbone that might be taken for granted in more developedareas of the world. Banks were not interested in providing financ-ing. He relied mainly on funding the business through successiverounds of equity. “We introduced service where telecom never ex-isted before. We offered good quality at affordable prices.” At Cel-tel’s launch in 1998, there were just 2 million cell phone subscribersacross Africa. Now there are more than 130 million. Celtel’s successinspired a host of rivals. In 2005, Celtel was sold to MTC Kuwait for$3.4 billion, making it one of Africa’s most successful commercialventures. The company, now in more than 15 African countries, hasinvested in excess of $750 million in Africa.

Ibrahim personally continues to give back to the continent wherehe built his fortune. In addition to his public-sector prize for lead-ership and governance index, he established a $200 million venturefund to invest in African entrepreneurs. “Governance is the key,”Ibrahim said. “I could buy a nice super yacht or airplane. But it ismy duty. We are part of the fabric of Africa. This is money I madein Africa, and it is really their money.”

But these investments in Africa are not merely charity. Ibrahimknows better than anyone the opportunities that might be hiddenbeneath the global perception. Africa is rising. “The environmentfor business in Africa is continuously improving,” he said. “A large


Patrick Awuah, a U.S.-educated Ghanaian native and former Mi-crosoft engineer, also recognized the need to cultivate leadership.Awuah founded the Ashesi University to prepare future leaders inAfrica. “I came to the conclusion that the most important reasonAfrica is in the shape it is in is because of a shortage of leadership,” hesaid in a phone interview with the author. “If people like me don’t be-come engaged, who else is going to do it?”26 Former McKinsey con-sultant Fred Swaniker (also from Ghana) recognized this same needwhen he set up the African Leadership Academy for high school stu-dents in South Africa. “Societies are made or broken by relatively fewindividuals in those societies,” Swaniker said in a May 2007 interviewwith the author, noting the positive impact Nelson Mandela andDesmond Tutu had on Africa, and the negative effect of other leaders.“We are identifying those people who can serve as change agents forAfrica.” With a similar impulse, Belgian NGO Echos Communicationestablished the Harubuntu competition (from a Kirundi word mean-ing “there is value in this place”) to recognize the “men and womenwho are driving Africa forward” by fostering projects that “foster hopeand create wealth” (www.harubuntu.net).

Africa’s Rise: Hidden in Plain SightThe rise of Africa is hidden in plain sight. It can be seen along the

streets, and in the teeming aisles of retail stores such as Shoprite orNakumatt. It is evident in the expanding airports and flight paths ofKenya Airways, Ethiopian Airlines, South African Airways, and manyothers (not to mention astute global carriers such as Virgin Nigeria).

number of funds have now started working in Africa, and everyweek you hear about a new fund for Africa. Africa itself is tryingto stop shooting itself in the foot. A civil society is developing inAfrica. There is a new breed of young African people who havebeen educated in the best schools in the West. Many of them arecoming back to do business in Africa. Things are happening.There is an energy there. You can touch it. Africa is open forbusiness.”

www.harubuntu.net

24 AFRICA RISING

It can be seen in the extraordinarily rapid growth of banking, cellphones, automobiles, and consumer goods. It is right there in plainsight as you walk through the streets of Africa, but you have to openyour eyes to it.

This book is designed to open your eyes to the rise of Africa andthe opportunities it presents. In Chapter 2, “Africa Is Richer Than YouThink,” we consider how Africa is richer than India, and more than adozen African countries are richer in GNI per capita than China. Thedevelopment of cell phones and banking are creating a platform forfurther growth. It is clear that these early developments are just thebeginning. In country after country throughout Africa, I heard thatthe heart of the future opportunity in Africa is the middle of the mar-ket, which I call Africa Two. In Chapter 3, “The Power of Africa Two,”we examine the opportunities presented by the more than 400 millionpeople in Africa Two, as well as the significant and immediate oppor-tunities of the premium segment (Africa One) and the low-incomesegment (Africa Three)—for companies with the right models.

With this context, we then turn our attention to some of the spe-cific opportunities that are emerging with the rise of the African mar-ket and some of the characteristics of the market that might come asa surprise. In Chapter 4, “Harnessing the Hanouti: Opportunities inOrganizing the Market,” we examine how the African market is be-coming increasingly organized, with transformations in retail, distri-bution, transportation, and other areas. Companies are building theirAfrican businesses by leading or using this process of organization. InChapter 5, “Building Mama Habiba an Ice Factory: Opportunities inInfrastructure,” we examine how the weaknesses in African infrastruc-ture—including electricity, water, sanitation, and medicine—are actu-ally sources of opportunities and how companies are buildingbusinesses around meeting these market needs.

Africa has one of the world’s most youthful populations—andgrowing younger every day—creating a significant source of opportu-nity for products from school uniforms to diapers to education, as ex-amined in Chapter 6, “Running with the Cheetah Generation:Opportunities in Africa’s Youth Market.” With the rise of Nollywoodand other less-visible centers of entertainment and media acrossAfrica, there are more opportunities for companies to get their mes-sages out or to build businesses in media and entertainment, as


considered in Chapter 7, “Hello to Nollywood: Opportunities in Mediaand Entertainment.” In many areas, Africa is leapfrogging the West.

The African opportunity is bigger than the continent, with mil-lions of Africans in the global diaspora sending billions of dollars intoAfrica, as well as bringing their experience and knowledge back home,as examined in Chapter 8, “Coming Home: Opportunities in theAfrican Diaspora.” Although the outflow of talented African profes-sionals led to concerns about a “brain drain,” this is another hiddendriver of Africa’s rise and growing wealth. Finally, the Conclusionlooks forward to the opportunities ahead for Africa and how they canbe realized.

Inexplicable OptimismIt is perhaps no surprise that there is a sense of optimism across

Africa, although this seems at first to be inexplicable if you follow thenews headlines in the United States. A 2007 survey of ten sub-Saharan countries by the New York Times and the Pew Global Atti-tudes Project found that most Africans believe they are better off today than five years ago.27 In Senegal, 56 percent felt they were bet-ter off compared to just 30 percent who felt they were worse off. InNigeria, 53 percent felt they were better off, and in Kenya 54 percent.The respondents were also optimistic about the future. They obvi-ously are not paying attention to the Western cable news reports onAfrica. (In fact, in the same study, 71 percent of Ethiopians felt theircountry was not covered fairly in the international press.)

A study by McCann of optimism among 16 to 17 year olds in tencountries around the world found that many youth in developed coun-tries such as the United Kingdom are jaded, but South African youthare among the most optimistic people in the world. A pan-Africanstudy by The Coca-Cola Company in March 2006 found this sense ofoptimism across African countries, although it might mean slightly dif-ferent things in different regions. Across the board, optimism meansself-belief and taking charge of your life.

“The paradox is that Nigeria is one of the toughest places in theworld to live,” Lolu Akinwunmi, CEO and managing director of Prima

26 AFRICA RISING

Garnet Ogilvy ad agency, told me during a meeting in Lagos in 2006.“You have generators at home and have to provide your own water.You have walls that are 9 to 10 feet high with three Rottweilers and asecurity man. The traffic is terrible. In spite of all this, Nigerians arecheerful people. It is not unusual to see people out at night sitting inlittle groups over beers and pepper soup, unwinding from the stress ofthe day.”

While those outside of Africa focus on the problems, there is asense in many parts of Africa that nothing is impossible. Nigeria hasannounced plans to send a Nigerian to the moon by 2030. In 2007,Nigeria announced a plan that would make the country one of theworld’s top 20 economies by the year 2020, looking to Singapore as amodel for transforming its economy. This is in a country that cannotprovide reliable electricity to its population and where the average2006 per capita income was just $640.

But if you doubt this could happen, consider that Chinese engi-neers helped Nigeria design, construct, and launch its first geostation-ary communications satellite, the $300 million Nigcomsat-1, in 2007.China provided financing for the project and the state-owned Chineseaerospace company, Great Wall Industry is tracking the satellite andtraining Nigerian engineers to staff a tracking station in Abuja. Thesatellite is expected to improve bandwidth for commercial customersand also support distance learning, online public access to govern-ment records, and online banking. South Africa constructed thelargest telescope in the Southern Hemisphere in the little town ofSoutherland in 2005. Despite problems on the ground, Africa contin-ues to look to the heavens.

As Matthew Barwell, marketing director of Africa region for Dia-geo, says, “The greatest export out of places like Nigeria is optimism.”Some see this sense of optimism as a result of the fact that they havenowhere to go but up. Perhaps the best explanation of it was given bymy driver in Lagos. Aptly named Moses, he was lost in the wildernessthrough most of our travels across the city, causing me to miss meet-ings. Yet he remained superbly self-confident about his knowledge ofthe route to the next location. When pressed, he admitted that inNigeria you need to appear confident or the world will push you down.This optimism can also be seen in the platoons of unemployed who


trudge through the endless traffic jams in Lagos with every productunder the sun—from packs of gum and sodas, to appliances, carpets,and chairs. It is literally a department store on legs. Where there is noemployment, people turn to trading. This optimism can also be seenin advertising focused on children and youth (for example, see the adfor Peak Milk in Exhibit 2). As the caption says, they believe “the fu-ture is waiting.”

This is not wishful thinking. It could be a leading indicator. Thisoptimism reflects a belief across the continent in Africa’s rising oppor-tunities. Africa is rolling up its sleeves to work on solving its own prob-lems. This spirit can be seen in the work of community leaders suchas Dr. Wangari Maathai, who became the first African woman to winthe Nobel Peace Prize in 2004. She is among more than 16 recipientsof Nobel Prizes from Africa (more than India or China), including 7Peace Prize winners. After studying in the United States, Maathai re-turned to Kenya, where she earned her doctoral degree and foundedthe Green Belt Movement, which has mobilized women to plant morethan 100 million trees across Kenya to prevent soil erosion andsparked a global campaign that reached its goal in November 2007 ofplanting a billion trees. (For more on her remarkable story, see her au-tobiography, Unbowed: One Woman’s Story, and www.greenbelt-movement.com.) As she said in an interview with CNN after receivingthe prize, “I really don’t think that Americans will change their per-ception about Africans until Africans change their perceptions aboutthemselves... what we really need is to encourage ourselves and relyon ourselves, because we have a lot of resources.”28

Africa’s optimism is shared by business leaders who have seenwhat they can accomplish in Africa. During a meeting at the SerenaHotel in Nairobi, James Mathenge, CEO of Magadi Soda in Kenya,said boldly, “I think the future of the world is Africa.” Wearing aleather jacket and open shirt, sitting at a table by the poolside at thebeautiful Serena Hotel in Nairobi, this statement was easy to believe.A tourist in a pink bathing cap floated by in the Olympic-size pool un-der the warm sun, as birds warbled in the foliage. This is the Africa thetourists on safari come to see as they pile into their Land Rovers everymorning to head out to the bush.

The tourism business is not the African opportunity that Math-enge was looking at. His business was in the rural lands 80 miles (130

www.greenbeltmovement.com

www.greenbeltmovement.com

28 AFRICA RISING

kilometers) to the south of Nairobi. Magadi Soda (now owned by TataGroup of India) makes soda ash that is used in glass, detergents, andother products. It exports around the world, especially Asia. Whenthere were no roads and railroads to reach their sites, Magadi builtthem. When there were no schools and hospitals for employees, theycreated them. Then they opened these facilities to the surroundingcommunity, the poor villages of the Masai tribesmen, devoting some20 percent of after tax-revenue to community service projects. Math-enge is optimistic because he knows that with such extraordinary ef-forts, there is the potential for building very successful businesses inAfrica. It is easy to agree with him that the future of the world isAfrica.

Rising Opportunities• What opportunities are being created by the rise of Africa?• What strategies will be needed to reach this potential market of

more than 900 million people?• What are the emerging market needs that can be met?• How quickly will these markets emerge?• What are the challenges facing the continent in its develop-

ment?• What are the opportunities in the diversity of the African conti-

nent?

INDEX

AABS (Assocation of African BusinessSchools), 140

Ab-dul Rahman Ibrahima Ibn Sori (WestAfrican prince), 183

Abdou, Fifi, 53Abebe, Tsegaye, 114Absa Group, 47-48Accor hotel chain, 178Actis Real Estate Investment Fund, 83activists, role in market opportunities, 211Addy, Tralance, 176Adebare, Rotimi, 10Adichie, Chimamanda, 119advertising. See also marketing

Michael Power advertising campaign,163-164

product packaging, 159-160wall branding, 159

aerospace industry in Nigeria, 26AES Corporation, 107Africa. See also names of individual

African countriesairline industry, 33-34ancient and modern civilizations in,

218-220Asian trade in, 15-17banking industry growth, 47-49cell phone industry growth, 45-47dangers in, 55economic statistics, 7entrepreneurship in, 17-19GNIC (gross national income per

capita), 29growth of companies in, 11-14India comparisons to, x-xiinvestment in, xi, 22Ireland and, 10-11largest companies in, 10market opportunities. See market

opportunitiesoptimism in, 25-28population statistics, 38, 128

247

religious diversity in, 52-55resiliency of, 218-220segments of, 57-58. See also African One;

Africa Two; Africa Threeaspirations, 71-73blurring of lines between, 73-74product examples for, 66

technological sophistication of, 160-162Africa Harvest Biotech Foundation

International (AHBFI), 121Africa One, 57, 66-69Africa Online, 168Africa Partners Medical (APM), 194Africa Three, 57, 66, 69-71Africa Two, 57-66

appliances, 65-66examples of, 58-60fashion retailers, 66home improvement products, 63-64housing market, 62personal-care products, 65product examples for, 66retail stores, 62-63

African Banker Awards, 48African Braids, 180African Business (magazine), 214African Business Awards, 216African Business Research Ltd, 35African Development Bank, 209African diaspora

complexities of, 182-184connections with, 185-186employment in Africa, locating, 167investments by, 175-176, 213-214Kwesi and Yvonne Nduom example,

184-185philanthropy by, 176-177products for, 180-182remittances sent from, 171-175ricochet economy of, 44-45size of, 169, 171tourism, effect on, 177-179

248 INDEX

African Heritage Inc., 184African Laser Centre, 122African Leadership Academy, 23African Venture Capital Association

(AVCA), 40, 216African Wind Energy Association, 107AfricaNews, 156Africanhair.com, 180AfricaRecruit, 167Afrohair.com, 180Aga Khan Development Network

(AKDN), 197Aga Khan Fund for Economic

Development (AKFED), 178Agarwal, K. N., 123agriculture industry, 120-122Agu, Forster, 86AHBFI (Africa Harvest Biotech

Foundation International), 121Ahmed and Maher Bouchamaoui Group, 93Ahmed, Samira, 53aid projects, effect of, 201-206. See also

charitable contributions; ubuntu marketAIDS. See HIV/AIDSair purification, 111airline industry, 16, 33-34, 112-114AirMoroc, 112, 179Ajram, Nancy, 132AKDN (Aga Khan Development

Network), 197AKFED (Aga Khan Fund for Economic

Development), 178Akinwunmi, Lolu, 25Akunyili, Dora, 94Al Akhawayn University, 141Al Kharafi, Nasser, 91Al Limby (film), 148Al Majd Holding, 93Al-Alfi, Moataz, 91Al-Sharbati, Abdul Rehman, 52Alam, Runa, 42Alexandria Carbon Black, 123Alfeld, Haiko, 18Alford, Terry, 183Algeria

auto industry in, 87education in, 212investments by African diaspora, 175local companies in, 51market information, 210Middle Eastern investment in, 41private equity investment in, 39-41

Alimi, Yomi, 181Alimohamed, Fatima, 71All African Peoples Organization, 183Amazing Grace (film), 132Amazon, 119American Express, 202

American University, 140-141Americana, 90-92Amin, Idi, 18, 164, 182, 204Amin, Mervat, 53AMSCO, 168ancient civilizations alongside modern

civilizations, 218-220Anderson, Nick, 161Angola, 38, 41Annan, Kofi, 122, 185Anthony, Donald, 86APM (Africa Partners Medical), 194appliances for Africa Two, 65-66Arab Tunisian Bank (ATB), 61Ashesi University, 23Ashi Dorji Wangmo Wangchuck (queen of

Bhutan), 215Ashoka, 199Asia, trade with Africa, 15-17. See also

names of individual Asian countriesAsian Paints, 64Aspen Pharmacare, 96aspirations

of African market segments, 71-73of parents, 135

ASSAD, 108Association of African Business Schools

(AABS), 140ATB (Arab Tunisian Bank), 61ATM cards as remittance method, 173Attieh, Karim, 157attitude of youth market, 142-145auto industry, secondhand market, 86-88AVCA (African Venture Capital

Assocation), 40, 216Awuah, Patrick, 23Ayittey, George, 130Azbane Cosmetics, 83Aziz, Dalal Abdel, 53

baby products, 134Bagayogo, Magara, 108Bajaj Auto Ltd., 88bakeries in Zimbabwe, 5Baligh, Ihab, 134bamaru (“sick” states), 36Banjoko, Titilola, 44, 167-168, 171Bank Misr, 134Bank of Abyssinia, 48banking industry

cell phone industry, collaboration with, 49electronic banking, 118growth in Africa, 47-49Hanouti, collaboration with, 77

Barclays, 47-48, 133Barwell, Matthew, 26, 72, 164Bayahi Group, 82BBBEE (Broad-Based Black Economic

Empowerment) Act in South Africa, 36BCME Bank, 77

INDEX 249

BeadforLife, 161Beasts of No Nation (Iweala), 202beer sales, 72, 90Bel Group, 136-137Belda, Alain, 184Belkhayat, Moncef, 77Ben Tanfous, Ferid, 61Benetton, 66Betz Paperchem Inc., 193Bhutan, constitutional monarchy in, 215Biamba Marie Mutombo Hospital and

Research Center, 176Bibliotheca Alexandria (Library of

Alexandria), 117, 119Bidco Oil Refineries, Inc., 8, 71biscuit sales, 136Biyani, Kishore, 60Bizcommunity.com, 157-158, 214Black Diamond (middle class in South

Africa), 9-10Black Like Me (company), 14, 180Blackhawk Down (film), 164Blair, Tony, 203Blood Diamond (film), 164Bollywood, 152Bono (of U2), 19, 201-202books, access to, 119Botswana, 124, 151bottled water sales, 69The Bottom Billion (Collier), 35Bouaziz, Habib, 50Bouchareb, Rachid, 151Boutros-Ghali, Youssef, 44Bowie, David, 202Böhm, Karlheinz, 202“brain drain,” 167brand awareness, organizing, 98-101brandhouse, 160brands, value of, 206-207Branson School of Entrepreneurship, 142Branson, Richard, 142breastmilkproject.org, 161BRIC countries, African market versus, 13Broad-Based Black Economic

Empowerment (BBBEE) Act in SouthAfrica, 36

Broadman, Harry, 16Buah-Bassuah, Paul, 122Burkina Faso, television industry in, 154Burundi, private equity investments in, 39Bush, George W., xibusiness development. See also

entrepreneurshipchallenges for, 36-37politics and, 17-19role of charity in, 19-20

business schools, 140-142, 212BusyInternet, 116

Calpeda, 109CAMAC International, Inc., 181Camerapix, 156Camfed International, 143Camilleri, Louis, 184Cape Verde, size of African diaspora, 169Capital for Development (CDC), 83Carrefour, 58Castle beer, 50CC Africa (Conservation Corporation

Africa), 195CDC (Capital for Development), 83cell phones, 117-118. See also

telecommunications industryinformal market for, 84phone ladies, 199power shortages and, 108remittances via, 174television broadcasts on, 155-156

Celtel, 21, 23, 34, 42, 49, 108, 156. Seealso Zain

Chad, private equity investments in, 39Chak de India (film), 218Chakravarti, Ranjan, 96Chandaria, Manu, 33charitable contributions. See also

ubuntu marketby African diaspora, 176-177effect of aid projects, 201-206role in business development, 19-20

Cheadle, Don, 207cheese sales, 136-137“cheetah generation,” 130Chellaram, Suresh, 101Chellarams Group Plc, 101Chery Automobile Co., 87Chicago Bears, 85China

auto sales in Africa, 87brand value of, 206gross national income per capita, 29trade with Africa, 15, 17

Chirac, Jacques, 203Chircu, Alina, 117Chissano, Joaquim A., 21Christian-Meier, Maude, 194CIDA (Community and Individual

Development Association), 142Cipla, 96Cisco Systems, 139Citigroup, 175Clark, Gregory, 202clean air, providing, 111Clinton Foundation, 198, 201, 203Clinton, Bill, 190Clinton, Hillary, 213clothing, secondhand market for, 85coal-to-oil production, 124Coartem (antimalarial drug), 93-95

250 INDEX

The Coca-Cola Company, 11-14, 53, 70,72, 89, 102, 105, 108, 118, 131, 133-134,192-193

Cockburn, Bruce, 118Cohen, Stephen, 214Colgate, 89collectivism, 71Collier, Paul, 35Comcraft Group, 33Commercial Bank of Ethiopia, 48Commission for Africa (U.K.), 203Commission on Capital Flows to

Sub-Saharan Africa (U.S.), 203commodities, creating brands from, 100-101Commonwealth Business Council, 168, 216communications. See cell phones;

telecommunications industryCommunity and Individual Development

Assocation (CIDA), 142computers, providing for schools, 139Congo, 38, 109, 176Conservation Corporation Africa

(CC Africa), 195conservation initiatives, 195-197“consumer safari,” xiiconsumers. See market opportunitiesConverse, 202cookie sales, 136cooking oil production in Kenya, 8cooking stoves, 200Cooper-Hewitt National Design

Museum, 200corporate social responsibility, 190-192corporations, as markets, 92-93corruption, cost of, 36cotton farming, 121Cowbell Milk, 136crocodile farms in Zimbabwe, 5Cummings, Alex, 12-14Cyprus, population of, 32

Daily Sun (tabloid), 158Dana, Simphiwe, 217dangers in Africa, 55Dangote, Aliko, 69, 100Danone (Dannon), 199, 211data quality (marketing data), 209-211Dau, John, 177Davis and Shirtliff Group, 109delivery, 88-92Dell, 202Delta, 112Democratic Republic of Congo, 38, 109, 176demographics of African countries, 38design innovations, 200-201developed/developing world, connections

between, 216Development Partners International, 40DHL, 16

Diageo, 10-11, 71-72, 164, 192, 207, 214Diageo Africa Business Reporting

Awards, 207diamond production, 124diaspora. See African diasporaDiaspora Africa Forum, 185Dignified Mobile Toilets, 111discount airline carriers, 112disease prevention, 194-195Disney, 162distribution channels, organizing, 88-92diversity, religious diversity in Africa, 52-55Djibouti, 41Draper Richards Foundation, 198Drayton, Bill, 199drinking water, providing, 111Driss, Kamal, 175DStv Mobile, 155du Plessis, Deon, 158Dubai Holding, 40Dubai World, 40DuBois, W. E. B., 183Duk Lost Boys Clinic, 177Durojaiye, Isaac, 111

EAC (East African Community), 32EASSy (East African Submarine Cable

System), 115East Africa, music in, 131East African Breweries Limited, 50, 70The East African Marine Systems

(TEAMS), 115Easterly, William, 202Echos Communication, 23Econet Wireless, 3economy, 7. See also market opportunities

informal economy, 42-44remittances from African diaspora, effect

of, 171-175ricochet economy, 44-45in Zimbabwe, 3, 6

ECOWAS (Economic Community of WestAfrican States), 32

Edgars, 58education

of African diaspora in United States, 171need for, 212-213opportunities for, 139-142organizing, 101-102school uniforms, 127-128

educators, role in market opportunities,212-213

Eferakorho, Helen, 180Egypt

Asian trade in, 16auto industry in, 86baby products, 134brand value of, 206cell phone usage, 117

INDEX 251

distribution channels, 90-92feminine-care products, 138film industry, 147-148informal economy, 44, 84libraries, 117, 119market opportunities in, 35music in, 132oil imports, 123paint supplies for Africa Two, 64pharmaceutical industry, 96population rate, 38private equity investments in, 39religion, effect on business, 53-54retail stores for Africa Two, 62sports in, 133tourism industry, 177universities, 140water pumps, 109

Egypt Air, 112Eisenhower, Dwight D., 219El Djazair Hotel, 219El Guindy, Nadia, 53El Khouly, Khaled, 117El Kilany, Borhan, 91-92El Masri, Amin, 147-148El Mofty, Amgad, 92El Nasar (mining company), 122El Sayyad, Yasser, 88el-Aswany, Allaa, 148El-Nasr, Shereen Seif, 53electricity, providing, 105-109electronic banking, 118Elkin, Caroline, 124Eloui, Laila, 53emigrants. See African diasporaEmirates Airlines, 112Emirates International Investment

Company LLC, 41employers, effect on buying power, 71employment in Africa, locating, 167Enbee Stores, 127entertainment industry

film industry, 147-153, 164-165Michael Power advertising campaign,

163-164mobile television broadcasts, 155-156television and radio industry, 153-155

entrepreneurshipin Africa, 17-19economic impact of, 217social entrepreneurship, 198-199in Zimbabwe, 3-7

Envirofit International, 111environmental conservation, 195-197Equatorial Guinea, private equity

investments in, 39ESAA (L’Ecole Supérieure Algérienne des

Affaires), 212Eskom, 107

Ethiopiaairline industry in, 113-114auto industry in, 87banking industry in, 48brand value disputes, 207branding of, 206population rate, 38

Ethiopian Airlines, 112-114expatriates. See African diasporaExxonMobil, 4

Fang, Tom, 15Fanta, 132Far East Mercantile Co. Ltd., 210A Farewell to Alms (Clark), 202fashion magazines, 180fashion retailers for Africa Two, 66The Fate of Africa (Meredith), 51FDI (foreign direct investment), 38-42feminine-care products, 138-139fertilizer production, 122FESPACO (Panafrican Film and Television

Festival of Ouagadougou), 152FGC Wireless, 116film industry, 147-153, 164-165Financial Times, 143Findajobinafrica.com, 168Firestone, 210First National Bank, 48FirstRand Banking Group, 47Fitzgerald, Niall, 190Fitzgerald, Steve, 195Flannery, Matt, 198flower sales, airline industry and, 113-114Forbes’ list of billionaires, 68foreign direct investment (FDI), 38-42419 Internet scheme, 160Fox, Vicente, 185France, trade agreement with Maghreb

region, 32Frank, Eric, 11Freeplay Foundation, 188, 200Friedman, Thomas, 214Fugard, Athol, 149Fuss, Melvyn, 47

Gabon, 42Gallium Capital, 168Gamewatchers Safaris, 196Gap, 202Gates Foundation, 201, 203GAVI Alliance, 197GBSN (Global Business School

Network), 140GE Healthcare, 201Geely Group Ltd., 87generational differences, 130generators, Weza, 200genetically modified crops (GMOs), 122Geographical Information System (GIS), 116

252 INDEX

GhanaAfrican diaspora, size of, 169distribution channels, 89former slave trade, 182Internet access, 116Kwesi and Yvonne Nduom example,

184-185malaria prevention, 194music in, 132private equity investments in, 39remittances to, 172water supply, 176

Ghosn, Carlos, 88Gibson, David, 176Gillette, 89GIS (Geographical Information System), 116Global Business School Network

(GBSN), 140Global Clothing Industries, 85global companies, local African companies

versus, 49-52global economy, leading African

companies in, 122-124Glover, Danny, 183GMOs (genetically modified crops), 122GNIC (gross national income per capita), 29God Grew Tired of Us (Dau), 177Goldberg, Whoopi, 183Goldman Sachs, 197, 215Goldvision, 100Google, 119Grameen Bank, 199The Grand Slave Emporium (St. Clair), 183Great Wall, 87Green Belt Movement, 27Grieves-Cook, Jake, 196groceries, as remittance method, 174gross national income per capita (GNIC)

for African nations, 29Groupe Danone, 136Groupe Mabrouk, 82growth rate

of African countries, 37-38of African diaspora, 169-171of banking industry in Africa, 47-49of cell phone industry in Africa, 45-47power outages, effect of, 109of tourism industry, 177

GSM Association, 174Guha, Ramachandra, xGuinea, 171Guinea-Bissau, 171, 183Guinness, 10-11, 89, 156, 163-164GV Telecom, 115

Hafez, Abdel Halim, 148hair care products, 54-55, 180Hale, Victoria, 199Half a Yellow Sun (Adichie), 119Halim (film), 148

Hamoud, 50-51hand-washing campaign, 95Hanouti, 77-78Hapagfly, 113Harrower, Gill, 190Harubuntu competition, 23headscarves, effect on shampoo sales, 54-55health care, 194-195. See also

pharmaceutical industrydesign innovations in, 201Novartis Foundation for Sustainable

Development, 204-205vaccination programs, 197

Heinichen, Richard, 193Heinsohn, Gunnar, 143Helios Investment Funds, 62Henkel, 210Hewlett-Packard, 139Hibbard, Devin, 161high-net-worth individuals (HNWI),

growth rate of, 69Highland Tea Company, LLC, 187-188“hippo generation,” 130HIV/AIDS

Coca-Cola example, 192impact of, 190-191prevention, 132testing, 97Unilever example, 190-191

HNWI (high-net-worth individuals),growth rate of, 69

Hoffman, Jenny, 49Homan, Michael, 202, 206home improvement products for Africa

Two, 63-64Homecoming Revolution, 185Hood, Gavin, 149, 164hospitals founded by African diaspora, 176hotel industry, 178Hotel Rwanda (film), 164, 207housing market in Africa, 62Houston, Whitney, 63Hu Jintao, 16humanity. See ubuntu marketHunter, Ron, 177Hunter-Gault, Charlayne, 214hydroelectric power, 109

“I Go Chop Your Dollar” (song), 161I Hate My Village (film), 150Ibrahim Index of African Governance, 21Ibrahim, Mo, 21, 23, 40, 214ICICI bank, 48Idriss, Moulay, 219IFFCO (Indian Farmers Fertiliser

Cooperative Limited), 122IFFIm (International Finance Facility for

Immunization), 197IIT (Indian Institute of Technology), 212

INDEX 253

Iliacom, 118Immelt, Jeffrey, 213immigrant populations in United States,

169. See also African diasporaimmunization programs, 197Imperial Holdings, 14Imperial Reckoning: The Untold Story of

Britain’s Gulag in Kenya (Elkin), 125importing oil, 123Imra Assets Management of South Africa, 7income and expenses, Africa Two example,

58-60. See also GNICIndia

Africa comparisons to, x-xiauto sales in Africa, 87brand value of, 206business development in Uganda, 18gross national income per capita, 29landlocked areas of, 33market opportunities, Africa market

versus, 60medical tourism in, 179“sick” states in, 36trade with Africa, 16

Indian descent, Africans of, 182Indian Farmers Fertiliser Cooperative

Limited (IFFCO), 122Indian Film Academy Awards, 152Indian Institute of Technology (IIT), 212Indianapolis Colts, 85Indigènes (film), 152indigenization, 6individualism, 71Indo Egyptian Fertilizer Company, 122Indo Mie Noodles, 210Industrial & Commerce Bank of China

Ltd., 47infant mortality rates, 195inflation. See economyinformal channels for remittances from

African diaspora, 173, 175informal economy in Africa, 42-44informal market, organizing, 83-85infrastructure creation, 105

agriculture industry, 120-122airline industry, 112-114clean air, 111drinking water, 111in global economy, examples of, 122-124Muthaiga Golf Club example, 124-126power grids, 105-109publishing industry, 119sanitation systems, 110-111telecommunications industry, 114-118water pumps, 109-110

INMARSAT Limited, 139Innscor, 4-6, 82, 208Instant Grass, 134

Intel, 139intellectual property protection, 162-163International Finance Corporation, 178,

195, 212International Finance Facility for

Immunization (IFFIm), 197international students, 213Internet access, 115, 117, 160-161Investec, 47investment

in Africa, xi, 22, 38, 40, 42by African diaspora, 175-176, 213-214in Zimbabwe, 6-7

Ireland, Africa and, 10-11Ishani, Anil, 197Iweala, Uzodinma, 202

J. Heinz (company), 6Jakes, T. D., 52James, Barbara, 40Jet Only, 113Jet4U, 113Jeune Afrique (magazine), 214Jincheng, 97Johal, Jag, 39Joly, Claude, 211Jones, Monty, 120Jordan, Ginny, 161journalism, 156, 159Jude, Noelle, 93

K-Rep, 48Kaberuka, Donald, 18Karcher, Deepak, 210Katlama, Michel, 210Keith, Sharon, 160Kelkar, A. M., 110Kent, Muhtar, 12Kenya

Africa Two example, 58-60agriculture industry, 121airline industry, 16, 33-34, 112cell phone power usage, 108cooking oil production in, 8food expenses, 120investments by African diaspora, 175Muthaiga Golf Club example, 124-126nationalism of, 50optimism in, 25-27power grids, 106-108radio industry, 155remittances to, 171-173retail sales, organization of market, 80-81rioting in, 17roofing supplies for Africa Two, 63-64safari trips, 196service to landlocked countries from, 33Sheng language, 130-131soda ash production, 123

254 INDEX

sports in, 133students sent to United States, 213tea industry example, 187-189water pumps, 110

Kenya Airways, 16, 33-34, 112Kenya Ceramic Jiko, 200Kerr, Kevin, 11Kettani, Ali, 152Keys, Alicia, 202KFC in Zimbabwe, 4Khan Al-Khalili (bazaar), 218Kheir Zaman stores, 62KickStart, 110Kidzee, 140King, Martin Luther, Jr., 183Kingdom Bank, 6Kingdom Holding, 178Kirloskar, 106, 110Kitea, 178Kiva, 198Klintworth, Gail, 191Kolthoum, Om, 50, 117Kulula.com, 112

L’Ecole Supérieure Algérienne desAffaires (ESAA), 212

LabNow, Inc., 97Lagos. See NigeriaLakhdar, Ali, 99landlocked, African countries as, 33language of youth market, 130-131The Last King of Scotland (film), 164Lawal, Kase, 181Le Nouveau Royaume d’Abou (television

program), 154leadership, 21-23, 214-216Leaf Technologies, 53, 118leapfrogging

in agriculture industry, 120-122books, access to, 119in telecommunications industry. See

telecommunications industryLebanon, Africa connections with, 41Leisinger, Klaus, 204leprosy cures, 204Lesotho, remittances to, 172-173LG Electronics, 98-100Liberia, journalism in, 159libraries, 117-119Libya, private equity investments in, 39Life Straw, 193lifestyle segments (LSMs), 9Linda, Solomon, 162The Lion King (film), 162liquor sales in South Africa, 71Live 8 concert, 203Living Goods, 198Living in Bondage (film), 149

local African companies, global companiesversus, 49-52

Lonrho, 113Lord of War (film), 164Louw, Melanie, 9LSMs (lifestyle segments), 9Lynch, Bill, 14

M-Net, 153Maathai, Wangari, 27Mabati Rolling, 63-64Madhvani Group, 18Madhvani, Muljibhai Prabhudas, 19Mafia (film), 147Magadi Soda Company, 27, 123Maghreb region, trade agreement with

France, 32Mahfouz, Naguib, 218Mahindra, 88Makatiani, Ayisi, 168malaria, 93-95, 194, 205Malawi, 89Malaysia, 204Mali, 108, 182, 205Mama Habiba, 105MamaMike’s, 174Mandela, Nelson, 23, 67, 82, 144Mandela, Winnie, 82Mango, 66Mansour Group, 62market opportunities. See also economy

activists, role of, 211Africa One, 67-69Africa Two, 60-66Africa Three, 69-71African diaspora. See African diasporaeducators, role of, 212-213India versus Africa, 60infrastructure creation. See infrastructure

creationleadership, role of, 214-216local versus global companies, 49-52magnification factors, 37-44media and entertainment. See

entertainment industry; mediaNGOs, role of, 211objections to, 31-37organization of market. See organization

of marketprivate sector, role of, 208-210religious diversity, effect of, 52-55segments of African market, 57-58.

See also Africa One; Africa Two; Africa Three

aspirations, 71-73blurring of lines between, 73-74product examples for, 66

ubuntu market. See ubuntu marketyouth market. See youth marketin Zimbabwe, 3-7

INDEX 255

marketing. See also advertisingdata quality for, 209-211organizing, 98-100

Marketing Science Institute (MSI), 209Maruti, 87Masai tribes, safari trips, 196Mashaba, Herman, 14Massmart, 82MasterCard, 174Mathai, Mwangi, 110Mathenge, James, 27Mauritania, 170Mauritius, 48, 52Mauritius Commercial Bank Ltd, 48Mbeki, Thabo, 206Mbire, Charles, 143McDonald’s, 90media

film industry, 147-153, 164-165intellectual property protection, 162-163Michael Power advertising campaign,

163-164mobile television broadcasts, 155-156print and online media, 157-158product packaging, 159-160role in market opportunities, 214technological sophistication in Africa,

160-162television and radio industry, 153-155wall branding, 159

medical tourism, 179medicine. See pharmaceutical industryMediterranean School of Business, 141Meredith, Martin, 51Meschi, Meloria, 47Mexico, diaspora connections, 185Michuki, Wanja, 187-188Michuki, Watiri, 187microfinancing, 199Microsoft Corporation, 84, 139middle class in South Africa, 9-10. See also

Africa TwoMiddle East, North Africa connections

with, 40“Midnight’s Children,” xmilk sales, 136Millennium Project, 203Millennium Promise, 198Million Book Project, 119Mills, Greg, 202, 206Minghella, Anthony, 151The Mint (television program), 155Mississippi Masala (film), 182mobile phones. See cell phonesmobile television broadcasts, 155-156MobilNil, 53modern civilizations alongside ancient

civilizations, 218-220Mohammed VI (king of Morocco), 178

Money Express, 172MoneyGram, 171, 178Monsanto, 121Monterrey Tech, 212Morland, Miles, 42Morocco

African diaspora, size of, 169auto industry in, 88brand awareness, 98-100cell phone usage, 118education and training, 102film industry, 152Hanouti example, 77-78informal market, organizing, 83Internet access, 116markets in, 90Moulay Idriss (city), 219private equity investments in, 39religion, effect on business, 52remittances to, 173tourism industry, 178-179wind power, 108

Motsepe, Patrice, 68Moulay Idriss (Moroccan city), 219Mouyeme, Maserame, xiimovies, 147-153, 164-165Mozambique, remittances to, 173Mr. Biggs, 72, 208MSI (Marketing Science Institute), 209MSI (Mobile Systems International), 22MTech Communications, 155MTN (cell phone company), 45MTN Banking, 49MTV, 131Mugabe, Robert, 3, 6Mukherjee, Bhudeb, 210MultiChoice Africa, 151, 153MultiLinks, 108Mureithi, David, 125Musée du Quai Branly (Paris museum), 184Museum of the African Diaspora, 184music of youth market, 131-133Muthaiga Golf Club, 124-126Mutombo, Dikembe, 176Muye, Lawrence, 125Myeni, Thandiwe, 121Mzansi bank accounts, 48

N’Dour, Youssou, 132Nafdac (National Agency for Food and

Drug Administration and Control), 94Naguib Mahfouz restaurant, 218Naikuni, Titus, 33-34Nair, Mira, 182Nairobi. See KenyaNakumatt, 59, 80-81, 119, 174National Agency for Food and Drug

Administration and Control (Nafdac), 94nationalism, 49-52

256 INDEX

Native (film), 152Native Lingua Films, 153NComputing, 140Nduom, Kwesi and Yvonne, 184-185Nedbank Group, 47-48Negroponte, Nicholas, 139Nehru, Jawaharlal, 212Nelson Mandela African Institute of

Science and Technology, 213NEPAD (The New Partnership for Africa’s

Development), 122, 139, 168Nescafé, 132Nestlé, 11, 69New Boy Toys, 137The New Partnership for Africa’s

Development (NEPAD), 122, 139, 168New News Out of Africa (Hunter-Gault), 214New York City, Senegalese immigrants

in, 181Newcyc, 97newsletters, 157-158Ngahu, Catherine, 66, 130NGOs, role in market opportunities, 211Nigeria

aerospace industry in, 26baby products, 135brand awareness, 99-100, 206cell phone power usage, 108corruption, cost of, 36distribution channels, 89education and training, 101fashion magazines, 180film industry, 148-153informal economy, 42international market investment, 41investments by African diaspora, 175Ireland and, 10languages in, 131marketing data, 210milk sales, 136mobile television broadcasts, 155music in, 132optimism in, 25-27pharmaceutical industry, 93-95population, 32, 38power grid, 105power innovations, 109private equity investments in, 39remittances to, 171-172restaurant sales, 72retail sales, organization of market, 82sanitation systems, 111secondhand auto industry in, 86secondhand market, size of, 85sports in, 133students sent to United States, 213television industry, 154tire market, 210transportation systems, 97

Nigerian Internet scheme, 160Nigerian Women Eagles Club, 183Nigerian-American Chamber of

Commerce, 183Nnaji, Genevieve, 153Nnebue, Kenneth, 149The No. 1 Ladies’ Detective Agency

(film), 151Nobel Prizes, African recipients of, 27Nokia, 133Nollywood, 148-153noodles, marketing of, 210North Africa, Middle East connections

with, 40Not on Our Watch (Cheadle), 207Novartis, 11, 92-96, 194Novartis Foundation for Sustainable

Development, 203-205Nwobi, Chika, 155

Obama, Barack, 182Obasanjo, Olusegun, 122Oberoi Hotels, 218Odhiambo, Clarice, 193Ohonme, Emmanuel, 177oil

coal-to-oil production, 124cooking oil production in Kenya, 8imports of, 123

Okonjo-Iweala, Ngozi, 215One Acre Fund, 198OneWorldHealth, 199online media, 157-158opportunities. See market opportunitiesoptimism

in Africa, 25-28of youth market, 143

Oracle Corporation, 139Orascom, 46organization of market

brands and marketing, 98-101corporations as markets, 92-93distribution channels, 88-92education and training, 101-102Hanouti example, 77-78informal market, 83-85need for, 78-79pharmaceutical industry, 95-97public and private initiatives, 93-95retail sales, 79-83secondhand market, 85-88transportation systems, 97-98

Othmani, Slim, 41Overseas Private Investment Corporation, 62Owoh, Nkem, 161Özyegin, Hüsnü, 212

paint supplies for Africa Two, 64The Palms shopping mall (Nigeria), 82Paltrow, Gwyneth, 202

INDEX 257

Pamodzi Investment Holdings, 40Panafrican Film and Television Festival of

Ouagadougou (FESPACO), 152Pantaloon Retail (India) Ltd., 61Pantene, 54parental aspirations, 135Park n Shop, 18Parker, Robin, 158Patak Indian food company, 181Patel, Natu, 127Pathak, Bindeshwar, 111Pathak, L. G., 181Patil, R. S., 110Pears baby lotion, 135PEP Stores, 58, 80, 82personal-care products for Africa Two, 65pet food, 216Pfeffermann, Guy, 140pharmaceutical industry

nonprofit pharmaceutical companies, 199organizing, 95-97public and private initiatives, 93-95

philanthropy. See also charitablecontributions; ubuntu marketby African diaspora, 176-177effect of aid projects, 201-206

Philips, 99phone ladies, 199Pick ‘n Pay, 82, 101Pineau, Carol, 214Pioneer Hi-Bred International, Inc., 121piracy, 84, 162-163politics, business development and, 17-19Ponce de León (explorer), 144Ponsford, Richard, 56Pontin, Jason, 206Population Services International (PSI), 132population statistics, 32, 38, 128Portman, Marcel, 208Postbank, 48Power, Michael (advertising campaign),

163-164power, providing, 105-109Pravasi Bharatiya Divas, 185preschool educational opportunities, 140pricing in Africa Three market, 69Prince Among Slaves (Alford), 183print media, 157-158private equity investments in Africa, 38-42private financing for public initiatives,

197-198private initiatives, combining with public

initiatives, 93-95private sector, role in market

opportunities, 208-210Procter & Gamble, 53-54, 65, 70, 134,

138-139, 160, 192product packaging, 159-160Protea Hotels, 178

PSI (Population Services International), 132public initiatives, 93-95, 197-198publishing industry, 119

Q-drum, 200

radio industry, 153-155rainwater filtration, 193Ramamurthy, Thiagarajan, 81Rammutla, Peter, 120Ranbaxy, 96Rashidi’s, 70Reddy, Raj, 119RedMed Company, 93Reliance Consortium, 115religious diversity in Africa, 52-55remittances sent from African diaspora,

171-175Renaissance Capital, 40, 210Renault, 179restaurant business

in Nigeria, 72in sub-Saharan Africa, 208in Zimbabwe, 4

retail salesfor Africa Two, 62-63to African diaspora, 180-182examples of products, 59Hanouti example, 77-78organization of market, 79-83

retired African leaders prize, 21ricochet economy, 44-45Roberts, Kate, 133role models for African youth, 143Roodt, Darrell James, 164roofing supplies for Africa Two, 63-64Rose, Robert, 136Roundabout, 110Rugasira, Andrew, 203Rushdie, Salman, xRwanda

business development in, 20cell phone usage, 156Middle Eastern investment in, 41telecommunications industry, 114

Rwandtel, 115

Saad, Mahmoud, 148Saatchi & Saatchi, 11, 163SAB (South African Breweries), 90SABMiller, 50, 52, 72Sachs, Jeffrey, 198Sadza.com, 174safari trips, 196Safaricom, 50, 130, 173Salami, Ayo, 35Samara, Noah A., 153Samaritan’s Feet, 177Samsung, 219Sandoz, 134

258 INDEX

sanitation systems, providing, 110-111Sarhan, Hala, 162Sarkozy, Nicolas, 32Sasol, Ltd., 124SAT-3/WASC (South Atlantic 3/West

Africa Submarine Cable), 115satellite radio, 153-155satellite television, informal market for, 84Satya (private equity fund), 40SC Johnson, 194Schneider, Friedrich, 42school uniforms, 127-128SCIB Paints, 64Scojo Foundation, 199Seacom, 115secondhand market, organizing, 85-88Sembène, Ousmane, 148sendmoneyhome.org, 172Senegal

auto industry in, 87-88bus manufacturing in, 179former slave trade, 183immigrants in New York City, 181optimism in, 25print media, 157remittances to, 172-174

Serena (hotel chain), 1787-11 convenience stores, 185Shah, Atul (Haku), 81Shah, Premal, 198Shaheen, Ilham, 53Shakur, Tupac, 53shampoo sales, 54-55, 65Shearwater Adventures, 196Shell, 92Shell Foundation, 111Sheng language, 130-131shoes, as charitable contributions, 177shopping. See retail salesShoprite Group of Companies, 80, 82Shrek (film), 152“sick” states, 36Siemens, 130Sierra Leone, 116Singapore, 32, 35Sirleaf, Alfred, 159Skoll Foundation, 143Skoll, Jeff, 142Sky Channel 148, 180slave trade, 182-183Slavin, Ana, 161Smith, Alexander McCall, 151Smith, Will, 184SNBG (Société Nouvelle des Boissons

Gazeuses), 50social entrepreneurship, 198-199social responsibility. See aid projects;

charitable contributions; corporate socialresponsibility; ubuntu market

Société Nouvelle des Boissons Gazeuses(SNBG), 50

soda ash production, 123Sofronie Foundation, 143software piracy, 84Solar 3, 109solar power, 107Somalia, 20, 182Sony, 98-99South Africa

aerospace industry in, 26African diaspora, size of, 169Asian trade in, 15auto industry in, 88banking industry in, 48BBBE (Broad-Based Black

Empowerment) Act, 36beer sales, 72brand awareness, 99-101, 206business schools, 142coal-to-oil production, 124distribution channels, 89-90electronic banking, 118film industry, 149-151gateway role of, 35growth of companies in, 14HIV/AIDS in, 190informal economy, 42intellectual property protection, 162liquor sales, 71middle class in, 9-10optimism in, 25pharmaceutical industry, 96power grids, 107power innovations, 108private equity investments in, 38religion, effect on business, 52remittances to, 172-173retail sales, organization of market, 79-82schools in, 142sports in, 133television industry, 153transportation systems, 97-98Voortrekker Monument, 218

South African Airways, 112South African Breweries (SAB), 90South Atlantic 3/West Africa Submarine

Cable (SAT-3/WASC), 115South Mediterranean University, 141Spain, African diaspora in, 170sports of youth market, 133-134St. Clair, William, 183St. George Hotel, 219stability, need for, 215Standard Bank Group, 47-49Standard Chartered Bank, 133Stanek, Lanya, 145Starbucks, 187-188, 207State Bank of Mauritius Ltd., 48

INDEX 259

stereotypes of Africa, perpetuating, 202stoves (for cooking), 200study abroad programs, 213sub-Saharan Africa. See names of

individual sub-Saharan countriesSudan

brand awareness, 99business development in, 20philanthropy by African diaspora in, 177private equity investments in, 39remittances to, 171

Sumaria Group, 41Sundaresan, A. S., 64susu collectors, 48Swaniker, Fred, 23Swiris, Naguib, 46

Tanzania, 39, 41-42Tarayana Foundation, 215Tata Motors, 87-88, 98, 179, 190Taurel, Sidney, 184taxes, reduction in Egypt, 44Tazo Tea, 188tea industry in Kenya, 187-189TEAMS (The East African Marine

Systems), 115technological sophistication, 160-162TechnoServe, 108telecommunications industry, 114. See also

cell phonesbanking industry, collaboration with, 49growth in Africa, 45-47Internet access, 115-117

television industry, 153-156Temple Productions, 153Terracom, 114, 116Tessema, Tadesse, 87Thailand, medical tourism in, 179Thiof (magazine), 15730 Days (film), 153Tiro (magazine), 180toilets, providing, 110-111tokunbo, 85-88tourism industry, 177-179, 195-197toy industry, 137-138Toys R Us, 138trade. See business developmenttrade agreements among African nations, 32TradeNet, 47traffic control, 98, 107training. See educationtransportation industry, effect of tourism,

179. See also airline industrytransportation systems, organizing, 97-98trend spotting for youth market, 134Triki, Mahmoud, 141TRISCAF (Tristate Cameroon Family),

183Tsotsi (film), 149, 162, 164

Tucker beer, 50Tuninvest, 41Tunis, 60, 108, 172Tunisia

banking industry, 61battery power, 108business schools, 141education in, 212local companies in, 50marketing to immigrants from, 180Middle Eastern investment in, 40private equity investments in, 39retail sales, organization of market, 81

Tunisie Telecom, 53, 174Tutu, Desmond, 23, 189

U.S. Overseas Private InvestmentCorporation, xi

ubuntu marketaid projects, effect of, 201-206brands, value of, 206-207Coca-Cola example, 192design innovations, 200-201developed versus developing world, 216environmental conservation, 195-197health care and disease prevention, 194-195Kenya tea industry example, 187-189power of, 189-190private financing for public initiatives,

197-198social entrepreneurship, 198-199Unilever example, 190-191water purification systems, 192-193

Ubuntu software, 217Uganda

auto industry in, 87branding of, 206expulsion of Africans of Indian descent, 182GDP statistics, 203hand-washing campaign, 95informal market, organizing, 84Madhvani Group in, 18population rate, 38power grids, 107private equity investments in, 39remittances to, 173

Unilever, 11, 65, 69, 74, 89, 95, 101, 135,155, 159, 190-191

Unilever HIV/AIDS Resource Centre, 190Union Bank of Cameroon, 49United Bank for Africa, 48, 175United Berger Motor Dealers, 86United States, 169-171, 183, 213universities, 140-142University of Cairo, 140University of Cape Town, 140University of Kwazulu-Natal, 140University of Pretoria, 140University of Witwatersrand, 140Utomi, Pat, 18

260 INDEX

vaccination programs, 197van Rooyen, Renier, 80veils, effect on shampoo sales, 54-55Virgin Nigeria, 112Vodacom, 46Vodafone, 117, 133, 170Volvo, 179von Bergmann, Hubertus, 122Voortrekker Monument, 218vouchers, as remittance method, 174Voxiva, 156

Wainaina, Binyavanga, 131Wake, Girma, 113Wal-Mart, 81wall branding, 159Walsh, Paul, 10Wambugu, Florence, 121Wanyoike, Henry, 133washing machines for Africa Two, 65-66Washington, Denzel, 182water, providing for drinking, 111water pumps, providing, 109-110water purification systems, 192-193water supply in Ghana, 176water transportation, 200WaterHealth International, Inc., 176Waverman, Leonard, 47wealth, 29wealthy Africans, 67-69Wehbe, Haifa, 132Weinstein Company, 151Wen Jibao, 15Western Union, 171Weza generator, 200The White Man’s Burden (Easterly), 202Whittaker, Forest, 164Williams, Sheri, 155Williams, Stephen, 224wind power, 107Winfrey, Oprah, 142, 183wireless access. See cell phonesWoolworths, 58, 66Worku, Zewde, 114World Bank, 197World Economic Forum on Africa, 216World Toilet Organization, 111WorldSpace, 153

Wyler, Greg, 114

The Yacobian Building (film), 148Yaz (film), 152Yesterday (film), 164yogurt production, 199Youse, Jill, 161Youth Connectivity, 134youth market

attitude of, 142-145baby products, 134cheese sales, 136-137dangers of, 143educational opportunities, 139-142feminine-care products, 138-139generational differences, 130milk sales, 136music, 131-133parental aspirations for, 135population statistics, 128school uniforms, 127-128Sheng language, 130-131sports, 133-134toy industry, 137-138trend spotting for, 134

Yunus, Muhammad, 199

Zain, 33, 45. See also CeltelZaki, Mona, 153Zambia, 62, 89, 109Zambia National Farmers Union

(ZNFU), 156Zambian Airways, 113ZapMax, 89Zara, 66Zenith Films, 151Zimbabwe

consumers in, 73distribution channels, 89economic statistics, 3, 6informal economy, 42market opportunities in, 3-7private equity investment in, 41remittances to, 174safari trips, 196school uniforms, 127

Zito, Joseph, 147ZNFU (Zambia National Farmers

Union), 156

associate publisher and director of marketing: amy...

Documents