Private sector: an enabler of the continent’s growth
By Zaid Moola, Deputy Head Global Markets, Standard Bank Corporate and Investment Banking
The start of a new year offers an invaluable opportunity to reflect and look ahead. There is no question that 2024 was a year of change and disruption.
Across Africa, we saw numerous elections through the course of the year. The ruction-free nature of most of the polls reflects a growing democratic maturity which can unlock growth for the continent. The outcome of the various elections and orderly transitions where power changed hands should not be taken for granted, it is a process that other parts of the world do not have.
In South Africa, our own elections yielded results that initially created some introspection but ultimately led to the formation of a unified government that encompasses most of the political parties across the country. This unified government has so far proven to be resilient and determined to address the existential challenges that the country faces.
This is encouraging to a hopeful nation that has become accustomed to being resilient.
Much like most countries which emerged from the Covid-19 pandemic, South Africa faces various challenges. The impact of the pandemic and its associated economic impacts were substantial. According to the World Bank, the pandemic had profoundly negative global impact on economic equality, businesses and led to inflationary pressures. The emergence from such a significant event has not been easy.
Amid these challenges, it is important to recognise the immense opportunities that exist. We have seen infrastructure and logistics challenges in South Africa, largely exacerbated in the pandemic period, however, there has been an impressive reform agenda to counter arising challenges. The development of policy initiatives such as Operation Vulindlela and with the recently relaunched phase two of the Government Business Partnership (GBP), we have seen tangible steps towards leveraging skills to bolster economic growth.
Often overlooked among the areas that can provide avenues of growth and collaboration are our vibrant African Markets. The advent of the African Continental Free Trade Area (AfCFTA) in 2018 and ratification across 48 countries on the continent has undoubtedly given impetus to additional growth paths. The World Bank estimates that the agreement can potentially increase the continent’s income by $450 billion in just over a decade and increase intra-African exports by more than 81%. The AfCFTA also shows an estimated $3.4 trillion infrastructure investment opportunity if successful, with sea and air freight volumes expected to double with the implementation.
As a bank that has economic growth on the African continent, headquartered in the most industrialised economy, this is an agreement that we can maximise for the economic and social benefit of many.
Given our footprint across 20 African countries and 163-year heritage, we also know that bold talk must always be matched with action. In March of this year, we will host our inaugural African Markets Conference (AMC) where we will bring together a mix of policy makers, business leaders, financiers, and government representatives from the continent to chart ways of maximising on our existing ties.
We are confident that this inaugural AMC will be a call to action to increase intracontinental trade, improve the ease of transacting on the continent and showcase the vast investment opportunities on the continent which have traditionally been areas of concern.
This is a seminal year for South Africa and the continent as the country takes on the Presidency of the G20 and hosts the annual summit. As Africa's largest bank by assets, Standard Bank is taking an active role in the B20 (the business conference on the sidelines of the G20). Through our joint participation we will work to contribute to making the Presidency a resounding success.
Our reach and role on the continent make it imperative that we prioritise the strategic leveraging of facilities to continue to build this continent that we call home. We look forward to continuing to drive the journey towards sustainable growth through the course of 2025 and beyond.