Over the Counter Aid
Friday, August 19, 2005
From rock stars to world leaders, moving
Conjure up an image of
Yet beyond the well-known story of diamonds and gold lies one of wealth generation through business largely unacknowledged outside the continent–the growth of South African companies into regional multinationals across a broad range of industries.
Companies such as the Standard Bank Group and Metoz Holdings’ food group Metcash Trading–all Forbes 2000 companies–have developed into centers of regionalization.
These and others are forming an engine of growth for countries closely linked with the South African economy, such as Botswana, which is trying to turn itself into a financial services hub for foreign investors who want to run pan-African operations. “In economic terms, South Africa is to Africa what the United States is to the world,” Moeletsi Mbeki, businessman brother of President Thabo Mbeki, told the Royal Institute of International Affairs in London last year.
Metcash, which says it is the “largest distributor of fast-moving consumer goods on the African continent, is an exemplar of the trend. From its head office, symbolically situated at the intersection of Amethyst Street and Crownwood Road in the heart Johannesburg, South Africa’s economic capital, South Africa’s largest retailer (annual sales: $2.7 billion) is feeding Africa via more than 700 wholesale stores and supermarkets in Botswana, Malawi, Zimbabwe, Uganda, Angola, Namibia, Swaziland and Lesotho as well as South Africa, where it claims 35% of the wholesale cash-and-carry market.
Dubbed the “African Wal-Mart” in part because of its cavernous stores and superstores that sell food, liquor and consumer goods, Metcash is not seeking to mimic the upmarket drive of American and European grocers in order to grow its business. “The demand for food and other consumer products across the continent is largely unmet,” says Chief Executive Carlos dos
To keep prices low, dos
As well as low costs, Metcash’s success has come from the old-fashioned virtue of knowing its customers. In places like
Other examples of the potential of the intra-African market abound, even though they often get overlooked amid the hullabaloo over the aid versus trade debate:
–Electricity and energy: In sub-Saharan
–Telecommunications: Mobile phones are more appropriate than landlines, given
Many investors in emerging markets continue to regard
Kansteiner says that the primary aid policy of developed nations toward
This initiative is not only starting a deliberate transformation of business within