Alibaba Group, an e-commerce holding company worth half a billion dollars, has just changed the location of the regional distribution center from Kenya to Rwanda. The largest global players are entering the hot continent, counting on high returns on investment. Polish businessmen also see an opportunity, but under certain conditions.
In Africa, Poland is associated with the European Union. And in the Black Continent the EU means the highest quality. In addition, as a state, we use the immediate vicinity of Germany, which by African states is considered to be an economic power. As a result, some of the German splendor flows toward us.
Tomasz Nowowieyski, creator of Mutalo Group, produces Kabisa Energy Drink. The drink manufactured entirely on the Vistula, transported to the black continent, was considered the best brand among new energy drinks during the SIAL Paris international food exhibition. It has been present in Africa for several years.
- The payback time and return of investments on the African continent is similar to that in Europe. It all depends on the industry and the scale of initial investment. It is difficult to compare private investments to those of state-owned companies. From my experience, investments based on political relations are the least stable – says the head of Mutalo Group.
He admits that due to the wide use of dollar and euro in trade and dependence on imported goods, the economies of sub-Saharan African countries (49 countries out of 54 located on the continent down from the Sahara) are involved in the global financial market than Poland. For this reason, if speculations about the upcoming inverse yield curve prove to be true, the markets in Africa will experience a slowdown.
It turns out that the two biggest problems of Sub-Saharan African countries interfering in investments are still weak state institutions and poor infrastructure. However, both problems are supposed to be soon solved... by China. The Middle Kingdom's presence on African markets continues to increase year by year. Chinese influence can be seen in almost every African country. The Chinese (every white man in Africa is referred to as a Chinese) are building roads, railways, skyscrapers. Chinese boards can be seen on construction sites, and Chinese builders on scaffoldings.
In immigration offices, hundreds of Chinese citizens are waiting to extend their visa, amazing officials with the lack of a basic knowledge of the English language. That is why Chinese translators and Chinese companies are coming to Africa to provide services for workers who find it difficult to find themselves in a foreign world. The weakness of local institutions is a challenge for these companies.
This can be seen on the example of a recent move made by Alibaba. The holding has decided to change the location of the regional distribution center. It moves from Kenya to Rwanda. It is the third, most popular country in Africa in terms of organization of international meetings planned by the International Congress and Convention Association (ICCA). Poland is also a member of the Association. In Rwanda, the long-term development strategy is carried out as part of the Second Economic Development and Poverty Reduction Strategy (EDPRS II).
Within its framework, the country has modernized the conference and hotel infrastructures, as well as transport networks and tourist attractions. The most important goal of the program is to promote economic growth and reduce poverty through the transformation of rural areas, youth employment and responsible management. The EDPRS II assumes an increase in the gross domestic product per capita to 1000 dollars. The World Bank suggests that in the future the private sector will have to play a greater role in ensuring economic growth. The main limitations of private investment are bad infrastructure and inadequate access to electricity. They are based on external assistance. Their stable inflow is of key importance for maintaining the current investment rate at the level of around 25 proc. of the GDP.
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