Dubai: Africa is becoming an attractive market for mall developers and grocery retailers, according to Irwin Barkan, CEO at BG International.
According the World Bank’s Africa Pulse report in April, economic growth in sub-Saharan Africa is expected to reach more than 5 per cent on average between 2013 and 2015, making Africa among the fastest growing regions in the world. Increased investments is supporting the region’s growth performance, it said.
Africa’s middle class is growing, with Nigeria, a country with a population of 170 million, has the region’s largest middle class outside of South Africa.
East Africa is the fastest growing region of the continent, according to Barkan.
The future of retail “is going to be in sub-Saharan Africa,” he said, describing Kenya as “the powerhouse of the region”.
West Africa, too, is growing, with Ghana and Nigeria leading the way, he said.
South African retailer Shoprite is targeting Ethiopia and Kenya, while similarly, Massmart Holdings, South Africa’s biggest food and household-goods wholesaler, is looking at an acquisition in Kenya. Consumer spending accounts for more than 60 per cent of Africa’s GDP.
Morocco’s retail scene is also developing. Hypermarket chain Carrefour opened its 40th market in Casablanca last month and has 30 supermarkets and 10 hypermarkets with plans to expand, Barkan said. In addition, the country has Morocco Mall, one of Africa’s largest shopping centres.
However, the situation in other areas of the North Africa region, including Libya, Tunisia, Algeria and Egypt, “has a dampening effect on investor appetite,” Barkan said.
The region has also seen more mall projects, some of which include Atterbury Property Holdings’ West Hills Malls in Ghana’s capital Accra and BGI’s Mallam Junction Mall.