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Nordic and Irish entrepreneurs urged to make Africa their business and investment destination

ABIDJAN, Ivory Coast, October 12, 2023/ — The African Development Bank Group’s Chief Economist, Prof Kevin Chika Urama, has urged entrepreneurs in Nordic countries and Ireland to make Africa their business and investment destination.

Prof Urama, on an official visit to Denmark, Finland, Ireland, Norway and Sweden between 25-29 September, said Africa’s population boom – projected to make it the world’s most populous region by the end of the century, with up to 3.4 billion people – offers huge business and investment opportunities to the rest of the world.

“With a population of more than 1.3 billion [currently], a youthful population of 600 million, rapid urbanization and rising incomes of the middle class, Africa is the lead-ing emerging market frontier,” said Prof. Urama, who was accompanied on the trip by Ms. Mette Knudsen, Executive Director for the Nordic-Indian-Irish Consituency at the African Development Bank.

According to Urama, agriculture and energy in Africa offer huge opportunities for trade and investment with Nordic countries, as the size of the food and agriculture market in Africa will rise to USD 1 trillion by 2030 from USD 300 billion in 2022.

Africa has 65% of the world’s uncultivated arable land with vast potential for sustainable agriculture and agribusiness.

Speaking in Copenhagen, Denmark, during a meeting with businesspeople on 28 September, Urama said that the African Continental Free Trade Area, the largest regional bloc in the world in terms of the number of countries, is estimated at $3.5 trillion in market size.

“Danish businesses should seize these business opportunities and invest more in Africa,” said Prof. Urama, who is also the Bank’s Vice President for Economic Governance and Knowledge Management.

He said that bilateral trade between Denmark and Africa increased by 28.6% between 2018 and 2022, from USD 2 billion to USD 2.6 billion and noted there was potential for growth.

“But this increase is insufficient in both value and relative terms. Between 2018 and 2022, total exports to Africa from Denmark represented on average only 0.3% of Africa’s total global imports,” he said.

Denmark’s imports from Africa represent only 0.1% of Africa’s total exports between 2018 and 2022.

“This needs to change given the huge potential and opportunities that African markets offer to Danish businesses for trade and investment and the strong partnership between Denmark and African countries,” he said.

Similarly, while addressing a business roundtable in Oslo, Norway, Urama highlighted the low levels of trade between Norway and African countries, despite the enormous potential that African markets offer to Norwegian businesses.

Bilateral trade increased from USD 3.1 billion in 2018 to USD 5.2 billion in 2022, an increase of 68%. Foreign Direct Investment (FDI) by Norway in Africa was estimated at USD 1.6 billion in 2021, a 12% decline from 2020.

“Much needs to be done to improve trade and investment between Norway and Africa. Between 2018 and 2022, total exports to Africa from Norway represented on average only 0.4% of Africa’s total imports,” he clarified.

Urama made similar calls to investors in Ireland, Finland and Sweden, encouraging them to seize investment opportunities in Africa, particularly in key areas such as green metals, such as lithium and cobalt, that will drive global market growth in clean technologies.

“The continent holds 80% of the world’s platinum; 50% of cobalt and 40% of magnesium, as well as vast deposits of lithium and graphite,” he said.

There are also untapped opportunities in the development of Special Agro-industrial Processing Zones. The African Development Bank and its partners are investing over USD 1.5 billion in the development of these zones, with 25 zones under development in 11 countries, he added.

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