Africa is Singapore’s new frontier

Africa represents a market of 1.2 billion potential consumers. About 90 per cent of phones sold in Africa are smartphones. African countries hold the largest share in the world of adults with mobile money accounts. Unmet demand and the need for new digital infrastructures are attracting entrepreneurs.

Singapore (AsiaNews/Agencies) – Africa has become the new frontier for Singapore’s new economy entrepreneurs.

More and more technology and financial start-ups are turning to the largely untapped markets of Africa to ride the next wave of growth.

Singaporean companies are especially attracted by 1.2 billion potential consumers, who want to be like the rest of the world,

West and central Africa have some of the world’s poorest economies, but unmet demands and the need for new digital infrastructures have brought in entrepreneurs in search of fortune.

Fibre optic and 4G networks have now reached the two regions; 90 per cent of phones sold locally are smartphones and an open regulatory framework for fintech services is in place.

According to experts, these countries tend to be neglected by investors, but have the same potential to as Africa’s top three economies.

“Apart from Africa’s top three economies, namely Nigeria, Kenya and South Africa, Singapore also eyes Mozambique, Angola, Ethiopia, Tanzania, Rwanda, Ghana, Ivory Coast, Egypt and Morocco for growth,” says Rahul Ghosh, regional group director for Sub-Saharan Africa of Enterprise Singapore, a government agency that facilitates such investments.

Kelvin Tan, secretary general of Africa Southeast Asia Chamber of Commerce, said that Singaporean firms have so far preferred East African Commonwealth nations for several reasons. “They tend to shun Southern Africa partly due to concerns of corruption, safety, currency volatility and underdevelopment,” he explained.

Africa has all the hallmarks of a continent ripe for start-ups and new ideas, especially when it comes to e-commerce, cross-border trade and government administration.

It has the world’s largest share of adults with mobile money accounts but poor cross-border payments; intra-African travel and trade is on the rise but government administration is poor; it has an aspirational working and middle-class population spurred on by the need for better infrastructure and resources; and regimes have largely keen to improve their reputations on the world stage.

China has been leading the charge regarding Asian venture capital interest, whilst funds from Japan and Korea have also actively experimented with a few deals. Now it's the time for Singapore.

However, Enterprise Singapore has a word of caution for firms thinking of entering African markets, noting that despite its huge potential much of the continent still suffers from regulatory uncertainty.