Financial Services an enabler in African investment
BUSINESS| Oct. 1, 2012, 7:30 a.m.
The financial services sector in Africa is playing a critical supportive role in the continent’s development, participants in the KPMG Africa Conversation webcast heard last week.
The financial services sector in Africa is playing a critical supportive role in the continent’s development as a result of increased consumer spend, public and private sector investment in infrastructure, advances in technology leading to greater connectivity and increasing demand for natural resources by the developing BRIC bloc of countries.
These factors were identified as key drivers of growth at the seventh KPMG Africa Conversation convened last week, reports APO.
Other factors playing a role include increasing urbanisation across the continent, a greater number of enabling frameworks such as the continued increasing acceptance of the rule of law and the harmonisation of regulatory requirements at national and regional levels.
“In Nigeria, for example, regulatory reform led by the Central Bank has led to consolidation in the banking sector,” said Bisi Lamikanra, Head of Management Consulting at KPMG Nigeria. “This has led to more focus on retail banking. Further developments have substantially ‘de-risked’ several factors for local and foreign investors entering African markets,” she added.
Different models are also being developed for different financial services being offered in different regions. Globally, there has been a move from de-regulation to greater regulation. Junior Ngulube, CEO of Munich Re Africa, added that “The South African banking and insurance sectors have been very well-regulated and we didn’t see any of the turmoil that is still playing out globally. The rest of the continent is also very similar to South Africa in that respect. In Francophone countries, for example, there is just one [insurance] code and one currency. That makes it easy to transact business.”
Although investors should guard against assuming that all markets on the continent are the same, further risk for investors can be reduced through combined expertise. Nicholas Young, Africa COO at Citibank, suggested that “Because Africa is an enigma for many investors, a tailored approach should be developed for each market. Combined global and local partnerships work well to unpack different markets.” Such an approach can act as a key differentiator for investors entering Africa.
Increased connectivity, in Citibank’s experience, has illustrated that national Central Bank debates around policy issues have started to converge around common policy concerns across the continent, said Young.
“Foreign investors should invest now in learning how to operate in Africa,” urged Lamikanra. “They also need to recognise the importance of continuing to refine their understanding of how to operate in African markets and the role of financial services in the development of Africa.”
MORE BUSINESS NEWS
8 Lessons for entrepreneurs who want to conquer the worldSage Foundation Chairman Ivan Epstein outlines his top advice for entrepreneurs. Read More
TMT Finance Africa in Lagos 2016 to be launched in partnership with IHS TowersTMT Finance and IHS Towers have announced the launch of the inaugural TMT Finance Africa in Lagos, Nigeria conference on September 20, 2016. Read More
FNB, PayPal bring global eCommerce to BotswanaFirst National Bank (FNB) has announced it will be extending the partnership between FNB and PayPal to offer the PayPal Withdraw Service, previously available only in South Africa, in Botswana. Read More
Survey: businesses have less than two years to make digital inroadsProgress has announced the results of its recent global survey: "Are Businesses Really Digitally Transforming or Living in Digital Denial?" Read More
Gartner: profit opportunities exist for PC vendorsThe worldwide PC market registered one of its lowest quarterly growth rates in the first quarter 2016, but Gartner, Inc. said several profit opportunities exist for PC vendors. Read More
MTN Business makes headway to be an ICT Partner of ChoiceMTN Business, the enterprise business unit of MTN SA, plans to focus on three key areas in a bid to become the ICT partner of choice, namely, getting the basics right, accelerating growth and diversifying its revenue streams. Read More
MTN Ghana celebrates 20 years of operations in GhanaMTN Ghana has unveiled its 20th Anniversary logo at a grand ceremony held at the iconic MTN House in Accra to officially mark the 20 years of operations in the country. Read More
Copy Cat bets on innovation to grow market shareKenyan technology company Copy Cat Group is implementing a new transformational strategy to increase its market share in the ICT market. Read More
Infrastructure investments highlight bright spots for SSA economic diversificationThe commodity super cycle may have ended, but there are certainly bright spots for investors across sub-Saharan Africa, IHS has told the World Economic Forum on Africa. Read More
Africa’s CEOs look to innovation and technology to stimulate growthCEOs in Africa are ramping up their efforts to innovate and find new ways to do business on the continent, according to PwC’s Africa Business Agenda released at the 26th World Economic Forum on Africa in Kigali. Read More
FEATURED STORYGovernment should encourage youths in ICT early
Youths should be given more encouragement to develop their ICT skills, an 11-year-old app developer told Kokumo Goodie.
BEST READ NEWS
IN DEPTHIBM Opens First Cloud Data Centre in South Africa
IBM is opening a new IBM Cloud Data Centre in Johannesburg, South Africa. The new cloud center is the result of a close collaboration with Gijima and Vodacom and is designed to support cloud adoption and customer demand across the continent.
COMPANY NEWSThings to ask your MSSP to increase your network’s security
Arbor Networks has drawn up five questions to ask an MSSP to better ensure security throughout your organization.Networks Unlimited officially launches Mellanox Technologies Open Ethernet Solutions
Networks Unlimited, a value-adding distributor of converged technology, data centre, networking, and security technology throughout Africa, has hosted the official Johannesburg launch of Mellanox Technologies,