Did you know that Africa and India will make up two-thirds of the world population at the end of the century? Africa’s population will grow to become a significant portion of the world’s population.

The African Continental Free Trade Area (AfCFTA) was signed into effect on January 1, 2021, and instantly became the world’s largest trade deal in terms of participating countries. Fifty-four of the African Union’s (AU) fifty-five countries have signed the agreement, making it a market of 1.3 billion people.

In the next decade, the trade deal will eliminate 90% of tariffs in intra-Africa trade to create a single market with free movement of goods and services (World Economic Forum).

The continent is still largely dependent on global trade, with 47% of imports coming from the US. Although AfCFTA only affects intra-Africa trade, it will create opportunities for Delaware exporters, making it easier to work with distributors across the different countries.

The African Growth and Opportunity Act (AGOA) is the US’s free trade agreement with 38 sub-Saharan African countries. This agreement was enacted in 2000 (and refreshed in 2020) to foster trade, eliminate barriers to US trade and investment, and enact policies to reduce poverty, combat corruption, and protect human rights (United States Trade Representative). This act is scheduled to expire in 2025. At which time, the United States and Africa will re-evaluate the continental trade partnership to support regional integration in support of AfCFTA (United States Trade Representative).

Quick Facts: (Census.gov)

• 47% of African imports come from the US.
• In 2021, US exports to Africa exceed 22.1 Billion.
• In 2019, US exports to Africa were $26.7 Billion.

Key Sectors:

There are many key growth sectors in Africa. Here are a few Delaware small businesses should be aware of.

Agriculture Technologies

23% of Africa’s gross domestic product is from agriculture. As a whole, this is an enormous industry on the continent, yet 60% of farms are smallholder farmers. With $2.2 Billion worth of digital services for smallholder farmers untapped, there is demand for Ag-Tech. Subsectors include IoT and precision agriculture systems, biotech, specialty crops, soil technology, wastewater management, traceability and food safety technology, livestock feed technology, drones and agri-mapping, vertical farming.

Education

The private sector educates 21% of the population. There is a need on the continent for digitalized media, learning materials, management technology, skilling, and tertiary education.

Healthcare

The healthcare market in sub-Saharan Africa is over $35 Billion. South Africa is a significant market, with over 3800 public health facilities, including 400 public hospitals. The medical device market is valued at $32 Billion, and African countries rely on imported medical equipment and supplies. The US market share of this sector is approximately 30%. There are growing demands for diagnostic imaging, prosthetics, patient aids, dental products, and other medical devices.

Information Technology

Africa’s IT industry is worth $40 Billion. They are about two years behind the rest of the world, but the market is adoptive. There is a current demand for unified communications, conferencing and telepresence, systems integration, application customization, managed cloud datacenter hosting and colocation services, IT security products, and enterprise application software.

Delaware’s Trade Reps in Africa

Africa is a large continent of 54 nations, so we’ve hired two trade representative offices to serve Delaware small businesses.

David Garay is Managing Director of Indegate Consulting, headquartered in Morocco. He has more than 16 years of experience helping and accompanying American companies to access the African continent. David will serve Delaware exporters in the Maghreb countries (Morocco, Algeria, Tunisia, Libya, and Sudan) and Egypt. David speaks fluent English, French, Spanish, and Portuguese.

Richard Zurba is the founder and director Zurcom International, a trade facilitation and trade investment advisory services company located in South Africa. The firm assists companies to enter the sub-Saharan Africa markets successfully. With over twenty years of experience with export promotion and trade lead development across Africa, Richard has managed and supervised over 100 trade missions.

If your Delaware small business is interested in developing new customers in Africa, we invite you to join us on a business trip to South Africa to meet new customers and potential partners. If you are interested in participating in this trip, would like more information, contact us at Export@Delaware.gov.