Cover & spine - Trade Finance

SUB-SAHARAN AFRICAPost-crisis Africa: The new belle of the ball?There is one missing element in the numerous reports that have been written aboutthe allure of Africa as the “next frontier” for investors. This goes beyond the estimated6% growth rate in 2010 – more than double that of the developed world – and anincreasing consumer market that just reached a record 1 billion. Behind the statisticsand reports lies the impact of the global financial crisis on the continent’s psyche.Why is this important? Because the lessons learned from the crisis have caused a minirevolution resulting in a renewed African self-reliance – one can sense through theexplosion of infrastructure projects that in the next decade, many countries will betransformed, if not to the level of their BRIC counterparts then most certainlynearing them. This “mind transformation” has had a profound impact both on intra-African trade and on traditional trading partnership with countries beyond thecontinent.African traders have been hit hard by the crisis in the EU, which represents Africa’sprimary trading partners. Africa’s response to the foreclosures of many of itsinternational buyers, the drying up of investments and access to credit has been todevelop domestic markets to increase intra-regional trade with an eye to also attractinginvestors.In its stride towards strengthened regional integration, Africa has embraced the axiom“bigger is better” in order to increase market size and ultimately its appeal to investors.Although it still has a long way to go to bridge the gap with other regions such as Asia– intra-regional exports in Sub-Saharan Africa as a proportion of total trade accountsfor less than 10% in contrast to over 45% in developing Asia. Despite this lag, the EastAfrican Community (Burundi, Kenya, Rwanda, Tanzania and Uganda) made history12 TRADE FINANCE The Guide to Global Trade Finance Markets 2011