Africa—Population growth set to overtake Asia
Africa is about to go through a significant period of population growth. In the coming decades, the continent is forecast to account for 62% of global population growth, with Nigeria responsible for a large proportion of that growth. The world population is projected to increase by more than 2 billion persons by 2050. Of the 2 billion increase in population, 52% is expected to stem from Sub-Sahara Africa, which will become the most populous region in the world in the early 2060s. Africa currently accounts for less than 2% of two-way goods and services trade for Australia (compared with China at 24%). These two factors mean that there are significant opportunities for Australian exporters to meet the demands of a growing population.
It is estimated 170 ASX listed companies have operations in Africa. As the continent continues to develop, demand for imported goods and services will grow. According to DFAT, there are opportunities for Australian companies in the extractives sector across Africa. Though investment in the region often carries with it substantial country risk. Higher incomes in Africa could also provide opportunities for Australian tourism operators and education providers. Still, Australia faces competition from both countries with established trade relationships in Africa as well as lower-cost producers, particularly in agricultural products. Africa’s proximity to large markets such as Europe means that extra focus must be placed on strengthening ties between Australian exporters and African importers.