Tag Archives: the african continent

E-commerce in Africa to reach over $40 billion by 2024

E-commerce in Africa is set to reach over $40 billion by 2024: Africa is becoming the next home of the Internet giants, and more specifically those involved in E-commerce. As smartphones and the Internet become more and more within everyone’s reach, E-commerce is evolving, particularly among young people.

E-commerce in Africa is set to exceed $40 billion by 2024

According to statistics, the African e-commerce industry is expected to reach an annual growth rate of 24.7% in 2024. Whereas in 2017, the industry’s annual sales were just $7.7 billion. It is expected to reach $42.3 billion in 2024. Annual revenue is thus expected to achieve cumulative growth of almost 500% in 7 years.

Over the past two years (2020-2021), the Covid-19 pandemic has also helped the e-commerce industry, as elsewhere in the world. On the other hand, the short-term effects of inflation could cause a slowdown in growth on the African continent.

In 2021, the African e-commerce industry brought in $28 billion in revenues. It recorded growth of 31% on 2020 ($21.4 billion). “The annual growth rate is expected to gradually decline to 9% by 2025”, says the Statista report.

In 2022, the African e-commerce industry is expected to generate $33.3 billion in revenues, following an increase of 19%. For 2023, the report forecasts growth of 14.7% to $38.2 billion. In 2024, the annual growth rate will fall further to 11%, with revenues of $42.3 billion.In 2025, annual sales will reach $46.1 billion, thanks to an annual increase of 9%.

Net growth in the number of users

The growth of the e-commerce industry in Africa is mainly due to the continent’s expanding e-commerce user base.

In 2017, just 138.9 million people shopped online in Africa. This figure is expected to rise to 519.8 million by 2024, representing a compound annual growth rate (CAGR) of 17.9%. It should be noted that the growth rate of revenues is higher than that of the user base.

Furthermore, e-commerce penetration among the African population in 2024 is expected to be 40%. Thus, the revenue growth rate could record a more attractive rate than that forecast.

Challenges and opportunities for trade on the continent

Despite the growing popularity of e-commerce, the industry faces obstacles.

UNCTAD’s 2018 E-Commerce Index, which measures an economy’s readiness to support online shopping, covers 151 global economies, including 44 African countries. Mauritius is ranked 55th, the best position in Africa. Nigeria and South Africa rank 75th and 77th respectively. Nine of the bottom ten countries are African.

Challenges include slow and expensive Internet connectivity, poor infrastructure, weak logistics and little or no consumer protection.

Although payment by cell phone is on the rise, payment on delivery remains popular in Africa, making cross-border e-commerce difficult. Policies are often not adapted to complex payment chains, and merchants have fewer options for connecting their local e-payment systems to the services used by global customers.

By promoting greater interoperability between payment systems, policymakers can help strengthen Africa’s position as a global leader in mobile payments.

Scheduled for 2024, the new Free Trade Area of the African Continent (ZLEC) aims to create the world’s largest trading bloc, with a market of 1.27 billion consumers, set to grow to 1.7 billion by 2030. Bridging the digital divide and creating an enabling environment would help entrepreneurs win over new customers, and offer numerous opportunities for innovation.

The role that e-commerce can play in the realization of the ZLEC is essential. “E-commerce can boost intra-African trade, which accounts for 18% of trade, and boost Africa’s share of world trade, estimated at less than 3%,” said Ajay Kumar Bramdeo, AU Ambassador to the UN in Geneva, during E-Commerce Week.

Does China have hegemonic designs in Africa?

Does China have hegemonic designs in Africa? Less than two weeks after his appointment, Chinese Foreign Minister Qin Gang visited Africa for his first official trip. After Ethiopia, he is scheduled to visit Gabon, Angola, Benin and Egypt. In light of this new visit to the continent, how have China-Africa relations evolved over the past decades? How does the Chinese discourse of development assistance and non-interference particularly resonate with African countries? To what extent is the African continent becoming an increasingly important global issue? Francis Laloupo, journalist and associate researcher at IRIS, provides an update. Does China have hegemonic designs in Africa?

Every year, Chinese foreign ministers always begin their diplomatic visits with Africa. How have China-Africa relations evolved over the last few decades, and are they becoming an increasingly important global issue? Does China have hegemonic designs in Africa?

Does China have hegemonic designs in Africa? Great question!

This annual tour of Chinese ministers has become a tradition, and each time it is to highlight the specificity of the links between African countries and China over the past four or five decades. Beyond trade ties, these ministerial tours, like the China-Africa summits, are opportunities for China to emphasize the unique basis of this cooperation, namely its support for African countries against external interference and for development policies that guarantee respect for national sovereignty. In short, a reminder of the principles of the Beijing Protocol… Although these relations are long-standing, they were significantly reconfigured in the early 2000s. The current pattern of relations is the result of a historical coincidence between the process of diversification of external partnerships initiated by Africa in the 1990s and the programmatic offensive of a China that is conquering the world market, but also in search of raw materials and energy resources, of which Africa is the reservoir.

China has become the leading investor on the continent and is also a privileged partner in meeting infrastructure needs and implementing major multi-sectoral projects. Djibouti is one of the crossroads of the new Silk Roads, one of the signature projects of President Xi Jinping’s term in office. Over the past decade, relations have expanded beyond the economic framework to include security issues. For example, in 2018, China became one of the top suppliers of military equipment to African militaries, just behind Russia. One-third of the weaponry imported into Africa comes from China, and some 22 African countries make up the largest customer base for Chinese military equipment.

The Chinese discourse of development aid and non-interference is particularly resonant with African countries.

It is a discourse that is all the more seductive because it revives the memory of the struggles for independence and the ideological alliance of the non-aligned against imperialism. However, times have changed, and the ideological frame of reference has been supplanted by economic urgency and the incantatory postulate of so-called “win-win” partnerships. For many Africans, relations with China act as a political alternative to cooperation with Western partners. Some believe that China’s action on the continent allows the countries of the continent to make the most of the rivalries between the Middle Kingdom and other foreign operators. In terms of development assistance, it is true that China is particularly responsive and active in various sectors of economic life, and this on attractive and favorable terms compared to other major economic partners.

However, while this cooperation is often hailed by actors for its dynamism, it has begun to produce silent disputes, notably the issue of land grabbing or that linked to the relocation of Chinese industrial production to Africa. Moreover, the long-term impact of this cooperation on the major balances of African economies must be assessed. All the indicators already show that China is on its way to becoming the continent’s largest creditor. In other words, the Chinese method of development aid could eventually prove to be a new and insurmountable debt factory for Africa.

Russia and Turkey are increasingly present on the continent and Washington hosted the second U.S.-Africa summit last month. Is the African continent becoming an increasingly important global issue?

First, because the continent remains a major provider of natural resources and other precious materials. Add to this the fact that with a population of one and a half billion, it is still considered a significant consumer pool. Moreover, given the immense needs in terms of infrastructure and multisectoral investments, the continent constitutes a particularly fertile space of opportunity for emerging powers. Furthermore, Africa is increasingly involved in international security issues. The security challenges faced by several African countries, which are inseparable from global threats and crises, have made it an important geostrategic ally over the past twenty years. The question is how to strike the right balance between endogenous security policies and the disparity of security cooperation between African regions and their various European, American, Russian, Chinese or Turkish partners. Djibouti symbolizes this aggregation of geostrategic interests, with the presence of military bases from France, the United States, Japan, Germany, Spain, and China, which has invited itself there since 2017. It is as if these military bases in the Gulf of Aden were intended to be an observatory of Africa and the world.

Finally, African countries, because of the diversity of their international alliance systems, have become objective partners in terms of the mechanisms and evolution of influence strategies on the international scene. In this respect, African countries are still considered by the great and emerging powers as indispensable allies in their strategies of influence within the framework of the United Nations. However, Africa, which is increasingly attached to the mechanisms of multilateralism, no longer wants to be confined to the role of an adjustment variable in the rivalries between the great powers. It wants to choose its partners and no longer be subjected to them. To do this, several countries will have to develop their negotiation and decision-making capacities in the field of international relations.