Africa is most times mistaken to be a single country with one central government. A close study will show that there are 54 countries each independent on its own, with its own people, language, belief and culture.
Africa at this 21st century has become the business hub of most countries and companies because of its vast resources and population. In this article, I will categorized all African Nations as one because they all are making the same mistake.
In today Africa, starting a business as an entrepreneur without adequate funding is quite hectic and stressful. That is why many of its inhabitants are migrating to other countries. But the big question is “how long will they keep running off?” Most countries now have strict laws of the immigration of foreigners especially those from Africa.
So how can we make Africa with it vast resource and population to be the business center in the world? The same way Asia is dominating the world, remember that Asia was once regarded as poor continent.
Below are some of the challenges that African countries are passing through and have refuse to admit it or find a solution to it and thus making it easy for any country to exploit it.
Despite that colonialism is long gone in Africa, we still undergo a different kind of colonialism called NEO-COLONIALISM. Neo-colonialism can be defined as the control or domination by a powerful country over weaker ones (especially former colonies) by the use of economic pressure, political suppression and religion.
In all African country especially Nigeria, Rwanda, Senegal you can see the influence of other country especially in its economy.
Let me take Nigeria for example with its large reserve of Oil, it still doesn’t refine its products in the country but have to export it for processing and then import it and other petroleum products at a higher cost, its impact on the economy is not visible because it is able to keep the its budget afloat from the selling of the “black gold”.
CHECK OUT: 4 Financial Risk Businesses Face in Nigeria
Dependent on Import
Africa is considered as a consumers’ continent because it barely produce anything apart for some agricultural products. Because of this, it rely so heavily on import on things it could locally produce.
Most economic analysis will say Africa is a dumping site for most foreign goods. That may be true. Let me give an example using Senegal for example. The country main importers are china and the European Union, the import trade between these two countries and Senegal is estimated to cost at 351 Billion West Africa Franc (CFA Franc). The highest the country has ever had was 524.40 Billion West Africa Franc (CFA Franc) in January 2017, but how much does this country export to others countries? The amount of export is 163.30 CFA Franc. With a negative balance trade of (-) 187 billion.
Lack of Innovation
This is a serious issue in Africa, because of Africans heavy reliance on import, the local factory barely tries something new. Most factories are either owned by foreigners or by extreme wealthy business tycoons which are sometimes managed by foreigners.
Only a few countries in Africa such as Nigeria, South Africa, Angola etc. that has an active manufacturing sector that are indigenously owned but the level of the patronizing (purchasing) power of the citizens is very low when it comes to buying on local produces.
Though some African countries such as Rwanda, Kenya are gradually becoming more seriously on making it economy to be self-reliance there are other internal threat that slows it’s economic activity down such as corruption of politicians and government official, terrorism especially in Somalia and North East of Nigeria and high illiteracy rate among its populace.
I am still optimistic that Africa will be great again, if its inhabitants are ready to take issues on their hands rather to wait for external solution from abroad.