Hundreds of African firms with yearly sales of $500m a cause for optimism

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Hundreds of African firms with yearly sales of $500m a cause for optimism

3:09 CAT | 16 May 2016

AFP / From left, Philipp Rösler, Head of the Centre for Regional Strategies and member of the Managing Board, World Economic Forum, Paul Kagame, President of Rwanda, Dominic Barton, Global Managing Director, McKinsey & Company and also Co-Chair of the World Economic Forum on Africa, Graça Machel, Founder, Graça Machel Trust (GMT) and also Co-Chair of the World Economic Forum on Africa, and Dr Akinwumi Ayodeji Adesina, President of the African Development Bank (AfDB) at the World Economic Forum, Kigali on Thursday.

Mckinsey & Co has identified 700 African companies with annual sales of more than $500m, many of which are growing and reinvesting and are a reason for optimism about economic prospects on the continent, the consultancy’s global MD said.

“That’s a lot more than most people would think,” Dominic Barton said on Friday at the World Economic Forum on Africa in Rwanda’s capital, Kigali. “Two-thirds of them are private, that’s probably why we don’t know about them. And they’re growing.”

The extent and calibre of businesses in Africa, certainty that commodity markets are at, or near, a bottom and will eventually rebound, as well as the demographic outlook with a growing middle class, are all reasons to be bullish on the continent’s prospects, Mr Barton said.

Of the companies identified with annual revenue larger than $500m, 300 are in SA, 133 in North Africa and 56 are in Nigeria, Mr Barton said, citing McKinsey research for a report to be published in October.

Source: Bloomberg