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Africa risk specialist records 1600% growth in five years - Freight & Trading Weekly - 14 July 2000 edition -
- Freight & Trading Weekly
14 July 2000 edition
Africa risk specialist records 1600% growth in five years
Biggest challenge is protectionist environment, writes Joy OrlekUNPRECEDENTED GROWTH in trade with Southern Africa is mirrored in the 1600% growth recorded by risk management specialists Alexander Forbes over the past five years in its AfriNet division.
When barriers to trade with Africa came tumbling down, Alexander Forbes decided that its clients on the continent would best be served by locally based, locally staffed companies.
"We needed to be involved in the countries to service them properly," AfriNet managing director Brian Oxley told FTW, "which led us to establish own offices in 13 countries with correspondents in another 19 under the AfriNet umbrella.
"Each is an autonomous company, normally staffed locally and is totally focused on the clients who operate in their specific country. The network is co-ordinated by Johannesburg-based AfriNet whose sole task is to facilitate growth and provide training and technical resources."
It's a philosophy which is at odds with multi-national trends towards global insurance, but is based on strong moral grounds.
If you are operating in a country, you have a responsibility to that country in Oxley's view, and it's part of why Alexander Forbes has taken the investment route.
Africa is the only insurance industry which has grown, and it's expected to continue growing at a rate of 20% per annum, says Oxley.
"The biggest challenge on the continent is the protectionist environment, and the biggest threat is globalisation."
Already multi-national companies are insuring through global packages particularly in countries which are short of foreign exchange which poses a major threat to local insurance industries.
AfriNet will however continue to seek partners in Africa as a means of building up the local industries, with Nigeria and the Democratic Republic of Congo strong future contenders.
The emphasis in risk management continues to fall on prevention rather than cure, and seasoned Africa expert Oxley offers some simple advice to shippers in the region: "Know who you are dealing with and understand who they are.
"Knowing your partners will lead you to an understanding of the conditions in that country. In the end you should be using the services of a company that ideally has an office both in your base country and the country with which you are trading.
"Africa is a 'relationships' continent and the local people are therefore vital to success."
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