Africa is likely to become the world’s second fastest growing region by 2025 with a GDP of around $4.5trn, according to a new report by Frost & Sullivan.
According to the analysts Africa is the only continent with the potential to achieve double digit economic growth within the next decade, second only to Asia.
Untapped opportunities include urbanization, mobility, infrastructure, natural resources, investments in telecommunications and inter-regional trade, claims a new video from the company, Mega Trends in Africa.
The video predicts that by 2025 around half of the continent’s population will live in large cities and that if current demographic trends continue in 20 years Africa will have the world’s highest labour population, surpassing China and India.
Hendrik Malan, director of Frost & Sullivan Africa, said: “The big advantage that Africa (possesses), believe it or not, is the lack of infrastructure and lack of legacy systems.”
This opens the door for modern technology to be installed from the start and could enable Africa to achieve faster growth and modernisation than those achieved in South-east Asia, he said.
The video identifies Africa as a huge potential market for digital money companies such as Bitcoin because of the large amount of money transferred to and from the country.
It also predicts online sales will increase significantly over the next five years, saying they will account for nearly 7% of total retail sales in Africa by 2025 with Nigeria, South Africa, Egypt and Kenya likely to provide their biggestmarkets.
The demand for energy is likely to almost double to 930.4 million tonnes of oil equivalent in 2025 with the mining and minerals sector set to lead demand. The renewable energy sector is likely to experience annual growth rates of 8%.
East Africa is set to record the highest growth in trade volumes owing to improved transport infrastructure, the video claimed.
It also expects the proposed Free Trade Area between 26 African countries to boost average imports by 60% by 2020.