Growing investor confidence in Africa ‘supports growth strategy’, says PwC

Out-Law News | 24 Jul 2014 | 4:12 pm | 1 min. read

PwC plans to increase its advisory business by investing $100 million in "people and infrastructure” in Africa over the next five years in response to growing economic confidence in the region, it has announced.

The professional services firm said that its decision was supported by the firm’s latest annual global survey of chief executive officers (CEOs), which indicated that “69% of CEOs in Africa are very confident of revenue growth over the next three years”, compared to 51% of CEOs globally.

The chairman and senior partner of PwC's UK firm, Ian Powell, said: “Africa is an important frontier for economic growth. We believe the regional economy could double by 2020 to nearly $3 trillion and we are getting a clear signal from our international clients that Africa is an increasingly important market for them.”

Powell said: “Bilateral trade between the UK and Africa is long established and is conservatively valued at around $30 billion a year for goods and at least the same again for services, and both are set to grow significantly in the near future. This investment will help to develop the African professional services sector to meet this growing demand.”

He said: “Our people are our biggest asset and it is no surprise that the majority of our investment will go towards recruiting additional skills... our focus will be on developing deeper industry expertise in key markets across Africa. Africa has an abundance of natural resources and seven of the world’s fastest growing economies meaning the opportunities for UK business are significant.”

In addition, PwC said there would be a “further integration” of its firms to provide advisory services across the continent through one “pan-African entity”.

The group CEO of South Africa’s state-owned freight transport and logistics group Transnet, Brian Molefe, told PwC’s CEO survey: “Among the emerging markets, we think that Africa, for the first time in many centuries, is going to contribute quite significantly to global economic growth. While it’s coming from a low base, the continent is beginning to grow at about 5%, making it the fastest-growing region in the world.”

US-based Qualcomm Incorporated, a global provider of wireless technology and services, told the survey that it is also setting its sights on developing regions such as Africa.

Qualcomm chairman and CEO Paul Jacobs said: “All around the world cellular is touching everybody’s lives, and so the opportunities in Africa, in Southeast Asia, in areas that are not traditionally thought of as huge growing markets, are big for us, because people are moving from the second-generation phone, or maybe no phone… (to) the internet.”

The CEO of Swiss-based Novartis, Joseph Jimenez, told the survey: “The next emerging areas for us are in Africa, particularly in sub-Saharan Africa.” Jimenez said it would “not happen in the near-term... but probably in five to 15 years”. However, Jimenez said the company is “preparing for that now”.