MARKETS IN AFRICA
Markets In Africa : 11 Things To Look Out For In 2023
By Isaac Ngatia
Currency fluctuations
Currencies around the world had mixed performances . However , most international trading is based on the US Dollar ($ USD ). According to J . P . Morgan , a global leader in financial services , the $ US appreciated against many currencies around the world . The hiking of interest rates by the Federal Reserve ’ s ( the USA ’ s central banking system ), was the key reason for this appreciation . This appreciation , coupled with respective local factors within each economy , impacted currencies around the world . In Africa , most currencies were impacted by this rise , and the effect will continue in 2023 . Zimbabwean Dollar , Sudanese Dollar , South Sudanese Pound , Nigerian Naira & Ghanaian Cedi are some of the currencies that experienced significant depreciation . On the other hand , Zambian Kwacha appreciated .
This implies pricing of products and services , especially cross border transactions , will continue to be impacted . Marketers therefore need to keep a keen eye on the exchange rates .
Inflation will still be taking some breakfast
Like most of the global markets , in 2022 markets across Africa experienced market pressures from inflation . According to the Economist Intelligence Unit ( EIU ), the average inflation across Sub-Saharan Africa was about 14.5 %, but this is expected to decline to 12.5 % in 2023 . Most of the countries in Africa have
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Currency fluctuations mean marketers need to keep a keen eye on the exchange rates as this directly implies pricing of products and services , especially cross border transactions , will continue to be impacted . been putting up measures to control the inflationary pressure , especially from the post the Covid-19 pandemic . This is mainly as markets address food prices , which is a key factor . About 27 markets have single-digit inflation , and as more measures come in place , we should expect this inflationary trends to decline .
AfCFTA & the teething problems
The long-awaited roll-out of The African Continental Free Trade Area ( AfCFTA ) is finally rolling out , especially on trade . The Guided Trade Initiative ( GTI ) started in October 2022 , and the overall objective is to push meaningful trade across the continent . This would push trade beyond the regional blocks . This pilot project included Cameroon , Egypt , Ghana , Kenya , Mauritius , Rwanda , Tanzania , and Tunisia .
As AfCFTA comes to fruition , marketers will play a key role in ensuring its success . This implies that marketers need to develop regional and local value chains to ensure awareness and other demand creation initiatives take place in destination markets .
Let ’ s travel locally / regionally
Movement of people is also part of AfCFTA , but in this case , included as a separate factor as this includes push as individual ( private ) level , in addition to the initiatives by various governments . People within the continent have been traversing the borders , but with initiatives to ease movement , we should expect to see more people moving within the continent .
For instance , the year started with South Africa and Kenya signing a visa free movement , where now a person holding a Kenyan passport can enter South Africa on visa-free basis and stay up to 90 days .
The momentum for moving within Africa will continue in 2023 .
The reducing risk of political activities
In yester-years , there was always a risk factor whenever there were upcoming elections ( especially ones for electing a president ). However , this is changing . 2022 witnessed presidential elections in Angola , Kenya , and Somalia . 2023 has started with parliamentary
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