All eyes on West Africa for project growth

West and Central Africa continue to be among the fastest growing regions in the world – expanding at a faster pace than ever before. With Nigeria expected to overtake South Africa as the biggest economy on the continent, and the Democratic Republic of the Congo (DRC) set to see growth in excess of 10% this year, there is enormous potential for business in West Africa, said Thalma Corbett, chief economist for NKC Independent Economists. Speaking at the Breakbulk Africa conference in Johannesburg, Corbett said the pace at which these economies were moving could best be described as astounding. “Ghana discovered oil in June 2007. It took them only three and a half years from that discovery to start pumping oil. That is exceptionally fast, and while they have had their fair share of hiccups, in the past few years they have managed to overcome most stumbling blocks. So much so that they’re expected to start production on their second fields by no later than 2016.” Corbett said West Africa was one of the regions where an increase in projects could be expected in the next few years despite oil production in Nigeria having seen a decline in the past two years. “What is positive is that many of these countries realise they have to diversify their economies – especially the oil-producing countries who have felt an impact on their exports as the US has become more self sufficient thanks to its own shale production increasing. “There is a definite move towards increased economic diversification, while another positive is the enormous market size one is talking about – especially Nigeria,” said Corbett. “There are many opportunities to develop the manufacturing sector especially.” But dealing with corruption in the region remains a priority. “It is pervasive in many countries in the region and it becomes a difficult business environment. Also, with the dependence on commodities for export earnings and government revenues, the volatility of the oil price and production as well as commodity prices impacts negatively on economies.” CAPTION Nigeria is expected to overtake South Africa as the biggest economy on the continent.