Getting to grips with Africa

They say you cry twice in Africa - when you arrive, and when you leave. This homily sums up for me my experience working and living for many years in this challenging but also rewarding, vibrant and somehow addictive continent.

Even though I’m limited to Sub-Saharan Africa, it’s still big, very big and the challenges are big too but so are the opportunities, and those opportunities will grow in the short and longer terms to the extent that I strongly suggest you shouldn’t ignore them.

While I have within SDI the largest remit of all my peers with regard to geography covered I conversely have the narrowest industrial sector to cover as I focus almost exclusively on promoting Scottish oil and gas services and education and training aligned with oil and gas. Why is very simple – because of demand. Africa needs and wants what Scotland has, and respects and likes us enough to want to partner with us to get it.

Take a trip south around the continent, from Mauritania in the west, and you’ll pass countries like Senegal, Cote’d’Ivoire, Ghana, Nigeria, Equatorial Guinea, Cameroon, Angola, South Africa, Mozambique, Tanzania and Kenya. They’re all prospective markets for our Scottish oil and gas community. But they’re not alone, in fact take in every coastal nation and you’ll find few that don’t have an oil and gas industry. More pertinently, you’ll also find few that aren’t interested in a broad spectrum of what Scotland can offer. If you’re in oil and gas services – you’ll likely have a prospective customer base somewhere in Africa.

So where do you start – which is a very good question and should form the basis of the way you create an African market strategy. I suggest you should be very aware of how much resource you will need not only to set up in an African market but also to maintain that market. Africans don’t generally appreciate companies that think they can run African operations remotely and with minimal input. Africa may have many poor countries but that doesn’t mean they are cheap to operate in, in fact often they’re very expensive, like Angola.

Your choice won’t be easy, incidentally. African oil and gas markets range from mature producing giants, such as Nigeria and Angola, to rising pre-production stars such as Senegal and Mozambique.

Pick your best target markets – if you don’t know how – get help. There’s great help out there, not just from SDI, but also such as, DIT, EIC, Chambers of Commerce etc. Africa isn’t a place you take a chance.

Educate yourself about your chosen markets (before you go) and pay special attention to the ubiquitous local content regulations that generally rule the way business can be conducted. Make sure you know about profit repatriation and currency availability, the last thing you want is a pile of local currency going nowhere.

Finally, and usually most importantly, given you’ll most likely want (or need) to work through a local partner, choose them very wisely and after proper due diligence. This is the biggest and most important decision you’re likely to take and could mean the difference between good business or a legal nightmare. Again – unless you’re sure of your own capability to do this – get help.

Andrew Monaghan

Andrew Monaghan