African businesses are brimming with optimism for 2024, with a new study forecasting a surge in trade driven by two key factors: technology investments and the implementation of new trade agreements. This promising outlook emerges from DP World’s “Trade in Transition” study, surveying African executives on their trade expectations for the year.
Nearly three-quarters of these leaders credit public sector efforts like regional trade pacts with bolstering their supply chains. The African Continental Free Trade Area (AfCFTA) agreement, in particular, is generating excitement, with 28% of executives now eyeing sub-Saharan Africa as their biggest export market, a significant jump from 19% last year.
However, African firms remain cautious. Inflationary pressures, economic uncertainty, and political instability threaten to dampen growth, with over a quarter of businesses citing these as primary concerns. High transport costs and border delays further complicate the trade landscape.
Technology emerges as a beacon of hope. Recognizing its potential to address these challenges, 38% of businesses plan to leverage digital tools for better inventory management, aiming to slash trade costs. Additionally, 45% are gearing up for advanced automation and robotics to gain real-time supply chain insights and anticipate disruptions.
This tech-driven approach aligns with global trends, where advancements in supply chain technologies are fueling optimism. John Ferguson, Economist Impact’s global lead for new globalization, emphasizes this, stating that the report “reflects a profound optimism regarding technologies’ potential to address systemic and economic challenges.”
Mohammed Akoojee, DP World’s CEO for sub-Saharan Africa, echoes this sentiment, highlighting the synergy between public and private efforts. “The findings showcase the beneficial effects of trade agreements like AfCFTA,” he says, adding that “the synergy of public and private sector partnerships to enhance investment, strengthened trade agreements, and technological advancements also positions the continent for growth and resilience.”
