News and Views
Black middle class is top attraction for British firms
Africa’s growing black middle class is now one of the top three attractions for British firms wanting to do business on the continent, a new study shows.
In South Africa, where more than a third of people live below the poverty line, the black middle class is growing as more blacks overcome barriers from apartheid and join the consumer culture.
About 10% of the black population (three to four million people), are considered middle class.
Barclays recently conducted a survey of 250 British companies and asked what was the biggest opportunity for UK businesses in Africa. The firms said an expanding middle class ranked third after the reputation of British goods and services, and also growing infrastructure.
The survey, entitled Trade with Africa, also reveals that British firms are doing business with South Africa more than any other country on the continent.
The findings explain: “South Africa is the top country for exporters, with 60% saying they currently export there. Nigeria is second with 37%, followed by Egypt at 35%. Ghana and Kenya are at 24% and 23% respectively.”
South Africans appear to be receiving goods from the West well too.
Recently, separate figures showed that imports from Europe to South Africa had increased by R1.2 billion to R21 billion.
Two thirds of the British firms in the Barclays survey also said that they will increase the amount they export to Africa.
John Union, head of corporate banking for Barclays in Wales, said, “This is a ‘ground floor’ moment in many African economies, in which UK suppliers have the opportunity to build their brand in Africa at a time when a growing middle class is beginning to make long term brand decisions.”
However, while the report was broadly positive, Africa is still viewed as having the least potential at present, with Asia, Eastern Europe and Latin America all ranked above Africa by survey respondents.
By Irene Madongo. Also, read her report on the Durban Indaba 2012, which highlights the tourism potential of South Africa.