Africa: Can gaming capitalise on a new era of governance?
Rapid economic growth fuelled by a young population and immense natural resources is often the way in which Africa is described. However, there is also an enduring image of poor governance, civil unrest and widespread corruption that is deterring investment into the continent.
But is that the correct way to view things? I think it’s important to separate these human factors from the global foreign investment trends to uncover a trading environment for the gaming sector where sound business sense prevails.
It’s a fact that the rate of return on foreign investment is higher in Africa than in any other developing region. According to research by FDI Intelligence, Africa was the world’s fastest growing destination for foreign investment in 2014, a clear indicator of widespread growing confidence.
Major economies such as Nigeria, despite their continued struggle with internal regulation and peacekeeping, are still experiencing an influx of investment. In fact, foreign investment in Nigeria increased by 1213.98 USD Million in the third quarter of 2015. The new administration of President Muhammadu Buhari has made it a priority to encourage a direction on policy that facilitates better governance and a healthier business environment through political reforms, all outlined in his manifesto last year. President Muhammadu has even gone on record to say “I believe if Nigeria does not kill corruption, corruption will kill Nigeria”.
This new appetite for reform is not exclusive to Nigeria. Thirty-five of the 47 economies in Sub-Saharan Africa (74 percent) implemented at least one reform making it easier to do business in the past year (www.worldbank.org). This coupled with the African Union’s comprehensive free trade agreement and single air transport market, both to be actioned by 2017, establishes Africa as one of the most economically integrated regions in the world, behind only Europe and Southeast Asia.
This success has rippled past the obvious investment sectors such as oil and minerals. Africa has a market of one billion people with a growing middle class who have easier access than ever to the internet because of the growth in smart phone usage. They have an almost unrivalled demand for lottery based games and more recently a large boom in interest for European football amongst other sports which has sparked the sports book industry. International gaming giants such as Bet 365, Mybet and Mr Green to name just a few, are all present in the Sub-Saharan region and are prospering from this socio-economic upturn.
This is part of the reason why we are organising WrB Africa. This will be a high level event bringing together key industry stakeholders including top suppliers, operators and regulators from the high growth markets – including Kenya and Uganda, who are actually on the World Bank’s top 10 list of most improved for doing business this year. It will be a rare opportunity to not only witness the unparalleled progress being made in this industry, but to find out how you can become part of it.
The bottom line? Africa, like so many other parts of the world, does have some hurdles that will need to be addressed but rest assured, they are being addressed and this should not deter you from achieving maximum yield on your future investments.
Africa is poised to be the new frontier for investors but there will most likely be some risk involved, just like all things that reward.
Follow Curtis on Twitter: @CRclarion