These are challenging times for Africa. Its major economies are suffering from a slowdown in growth as global demand for minerals declines and the oil price falters. The economies of South Africa and Zambia have seen their currencies devalued substantially, while in my own country, Nigeria, we face a shortage of foreign currency, falling government revenues from oil – our main export – and renewed disruption to the fuel supplies that power manufacturing and domestic housing...
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To outsiders it looks like a case of ‘doom and gloom’ the media so like to report – a reality check on the ‘Africa Rising’ narrative and an excuse to cut investment in this great continent.
As an African, I am having none of this.
It may surprise you to learn that against the most challenging economic climate Nigeria has faced in many years, my own company increased cement sales by nearly 46% in the first quarter of 2016. April and May were almost as strong. In all my time selling cement in this great country I have never witnessed growth as strong as this.
So what is happening?
There is a saying that tomorrow belongs to those who prepare for it today. As I travel around Lagos, around Nigeria and further afield in Africa, I can see people busily preparing for the Africa of tomorrow and they are preparing by buying cement and building that tomorrow themselves.
There is much to do. In Nigeria and across Africa, housing, infrastructure and power must be brought up to global standards in the coming decades. What has happened in South East Asia and what is still happening in India and China is what will happen next across Africa.
Yes, there will be challenges and economic downturns along the way, just as there are right now. Even we have had to reassess the speed of our expansion plans in the face of Nigeria’s currency restrictions. But how can anyone in our industry look at this and say it’s not an opportunity to invest in modern, efficient factories that produce high-quality cement for the needs of tomorrow’s Africa?
The potential is extraordinary. We estimate that last year, Sub-Saharan Africa consumed about 100 million t of cement. That is just two bags of cement for every one of the region’s one billion people – well below global consumption averages. Let us assume consumption doubles in the next ten years and doubles again in the decade thereafter. Who can deny the huge potential of a market that goes from 100 million t to 400 million t in just 20 years? But that is not the full story because in that same 20-year period, the population of Sub-Saharan Africa could grow by 50% or 500 million people. It is obvious, then, that even after strong growth Africa’s per capita consumption will remain well below the global average even 20 years from now, meaning the potential for growth will persist for many years thereafter.
As an African, I see a continent that will change beyond recognition. As a cement entrepreneur, I see the potential to build a business many times larger than it is today. My advice to readers of World Cement is this: think of what Africa will look like in 2050 and decide whether you wish to be involved in its transformation.