Africa: innovation drives development and growth.
The GDP of sub-Saharan Africa is set to rise by an average of 5% per year over the coming 5 years. The figure sounds almost unlikely, but many international institutions see it as the future economic growth engine of the world. Figures of a GDP at almost $25 trillion by 2050 are commonly predicted – even expected. What is most surprising is that these figures are true despite the huge interruption that was and is COVID19. The Obama-initiated Trade Africa program has boosted infrastructure and trade, whilst improving literacy and education are providing a more sophisticated labour-force, 90 million of which have incomes exceeding $5,000. On this purely human level, this allows a leap from almost all income being spent on necessities to over half of it becoming discretionary. As banks have targeted a more affluent populace, the financial services sector has experienced record growth over the last decade, encouraged and supported by technological innovations.
Chinese investment in Africa has attracted the attention of European financial concerns and generated the construction of instruments and frameworks to support trade finance and supply chain management in the Continent. Those economies that are still emerging in Africa present challenges to this development, many banks having a hard time providing guarantees and security for foreign investment.
None of this had passed us by, and here’s why. Some entrepreneurial firms and financial institutions, dedicating themselves to expertise in the region, have identified where difficulties lie in the value chain, working with domestic organisations to get investment channels open and develop business opportunities. SWIFT connectivity is not what it should be and negotiating the financial infrastructure of many African countries is tricky. This is where these firms have stepped in to facilitate financial communications, allowing exchange of such essentials as Letters of Credit, lubricating the wheels of trade. Clever technology facilitates the basics such as due diligence upon those domestic institutions that might provide cash services to the foreign banks that wish to finance their clients’ projects and trading. Partnerships between these specialist facilitators and technological houses have produced fresh solutions that are paving the way to easier, faster and more efficient automated assessments between investment bank and African cash provider.
Our contribution to the facilities I describe in the last few lines is of course a very small cog spinning in support of the colossal, ever growing machine that is African commerce. MYRIAD’s innovative deployment of network management and due diligence technology allows domestic banks, corporates and foreign investment banks to communicate in a unique and automated fashion, helping to establish vital, secure and guaranteed relationships. The entire chain, from the investor, through the collaboration between facilitator and tech. provider in leveraging an innovative solution, to the domestic correspondent, represents the opportunity for growth in the region as barriers are removed. Those barriers once seemed insurmountable, but as the great Nelson Mandela said, “It always seems impossible until it’s done”.