African Boom Towns Made By The Middle Class
Boom towns have sprung up in some surprising places as a result of Africa’s economic growth, according to DHL, the company that moves a lot of the merchandise around.
Industries that are producing growing numbers of small and medium businesses include agriculture, banking, technology, consumer goods and telecommunications, says Charles Brewer, managing director for DHL Express Sub-Saharan Africa, in a VenturesAfrica report.
Brewer is in a good position to know. DHL Express has more than 3500 retail locations across Africa, with hundreds more planned before the end of the year, Brewer said in a report in AfricanReview.
A division of the German logistics company Deutsche Post, DHL provides international express mail services and it’s the world’s largest logistics company, considered a leader in sea and air mail.
When it comes to moving merchandise in and out of Africa, DHL Express Sub Saharan Africa’s top three import trade lanes are the U.S., France and China, Brewer said in a report in PostandParcel. Its top three sub-Saharan African export trade lanes are U.K., U.S. and France.
Connecting businesses with each other in Africa and around the world is the bread and butter of this global logistics giant. “Small and medium enterprises remain an integral part of our growth story and a core focus is to continue making logistics more accessible,” Brewer said.
But even with the accelerated growth Africa has experienced, it’s still the world’s least-connected continent if you consider the ease of moving people, trade, information and finance, according DHL’s Global Connectedness Index
One sector providing plentiful prospects is agriculture, Africa’s largest economic sector representing 15 percent of the continent’s total gross domestic product and more than $100 billion per year, Brewer told VenturesAfrica.
Another industry seeing significant growth is banking, which has become a big player in emerging markets driven by the rising middle class and unbanked African consumers. “Other industries experiencing growth and offering prospects on the continent include technology, consumer goods and telecommunications,” Brewer said.
Brewer identifies five unexpected boom towns and cities that are thriving from these five industries, providing opportunities for new African businesses.
Farafenni, the Gambia
Located on the north bank of the Gambia River about 120 kilometers inland from the capital Banjul, this town is home to numerous banks and insurance firms, according to DHL. It is experiencing rapid growth mainly due to its geographical location on the main road between Dakar and Casamance in Southern Senegal, and its proximity to the ferry across the Gambia River.
The Gambia is the smallest country in mainland Africa, and one of the poorest.
This up-and-coming technology hub has advanced infrastructure and facilities that have attracted many financial institutions and international legal firms.
Bobo-Dioulasso, Burkina Faso
Growth in the food and agriculture sectors has made this a boom town. Many small and medium enterprises are setting up factories to produce products locally for domestic and export markets. Main products incudel fruit, cereals, cotton, vegetable oil, soap and other artisanal products.
Mbarara is a growing industrial town in the heart of Uganda’s dairy farming district, 280 kilometers (173 miles) from the capital of Kampala. A combination of location, abundant available land and favorable climate attracts investors interested in manufacturing dairy products. Breweries and beverage companies are also expanding to the area.
Konza Techno City, Kenya
Its infrastructure phase complete, this new technology city located 60 kilometers southeast of Nairobi will focus on four economic sectors: telecommunications, education, business process outsourcing and life sciences. Konza Techno City is expected to stimulate technology investment, growth and spending in Kenya.
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