Africa: Land of Opportunities?

It’s easy to think of Africa of a continent of civil wars, famine, epidemics and lost hopes.  But that’s not the full story.  The May issue of Harvard Business Review (www.hbr.org) includes an article “The Globe: Cracking the Next Growth Market: Africa” that tells us there’s more to the story than doom and gloom.
http://hbr.org/2011/05/the-globe-cracking-the-next-growth-market-africa/ar/1

First of all, Africa is not one place.  It’s a continent with over 50 different countries, both large and small.  (As of this writing Sudan is the largest but July 9 when it splits in two, Algeria with over 33 million people  moves into that spot.  Smallest?  On the continent it’s Gambia with a population of approximately 1.5 million people.)

This article points out three factors that are changing the view of Africa as a potential market.  There is increased political stability in countries like Angola and Mozambique, reduced inflation and deficits and third more market friendly policies in places like Nigeria and Morocco.  The possibilities are drawing companies from China, India, Canada, France and the US to invest and expand.  (Among US companies Wal-Mart, Coca Cola and Yum Brands all are represented in multiple countries on the continent.)

But having noted that these countries present exciting opportunities the article goes on to caution the reader  to look carefully at each country.  History, culture, currency, income levels vary significantly.  The economies and possibilities differ in many ways.  Drawing on the research done by the McKinsey Global Institute (www.mckinsey.com), the authors divided the countries into four groups based on their economies.    The categories and examples of countries included?   Oil Exporter (Nigeria, Algeria, Gabon and Botswana); Diversified (South Africa, Cote D’Ivoire, Morocco) Transition (Kenya, Mozambique, Ghana) and Pretransition (Mali, Ethiopia, DRC). 

Simply looking at the chart used to illustrate the differences in these economies tells us that no two places are likely to be alike. Differences abound.  But looking forward, asking where should we be in 2013, 2016 and beyond, Africa and its many countries seem to merit consideration.   The challenges of entering these markets will be significant but as this article suggests, the rewards are likely to be significant also.

Do you know your cities?

Major metropolitan areas around the world are often thought of in terms of congestion, population density, as destinations for tourists, centers of political and economic activity.  As drivers of the world’s GDP?  Maybe not so precisely.   Yet what happens in these areas matters today and their impact is likely to increase.  It is predicted that by 2030 approximately 60% of the world population will live in urban areas.

 To begin to understand the contributions of these areas that combine cities and suburbs  take the Marketplace Globalist Quiz: When Cities Rule the World (http://www.theglobalist.com/storyid.aspx?StoryId=9029) published in a recent edition of The Globalist magazine. (http://www.theglobalist.com)    The quiz was drawn from the December 2010 Global MetroMonitor report prepared by The Brookings Institution and the  London School of Economics.  This document details the economic experience of  150 metropolitan areas around the world  - pre, during and post the most recent Financial Crisis/Great Recession.   (http://www.brookings.edu/reports/2010/1130_global_metro_monitor.aspx). 

The basic query of the Quiz:  What significant economic value do these collections of people, buildings, innovation, commercial activity bring to our world?

Their answer:  46%, almost half of the global GDP comes from these economic centers.  By contrast their populations estimated at 800 million people represent just 12% of our global population.  Relatively few people with significant impact.

Which of the countries studied performed best in income and employment growth during the recovery?  Istanbul, Shenzhen, China, Lima, Peru; Singapore and Santiago, Chile.   The best performing area in the US?  Austin, Texas and in Europe,  Krakow, Poland. Surprised?

Wondering about the prospects for your city, one where you plan to open a business,  or to visit for a holiday?  Check out the Global MetroMonitor for all the details and see where the recovery is strong and where the struggles continue.

From BRICs to BRICS – Five no longer Four

The BRICs -Brazil, India, China, Russia just became the BRICS (note the change in the letter “S”) with the addition of South Africa. According to the Economist (www.economist.com) these five countries represent “around 40% of the world’s population and nearly a quarter of its economic output.” http://www.economist.com/blogs/banyan/2011/04/emerging_economic_powers
Already known as an entity with growing influence on matters of trade and development this addition, the move to five from four, is likely to magnify the importance of this group.

According to Brent Radcliffe’s article “The Fab Five:  South Africa Joins BRIC”
(http://financialedge.investopedia.com/financial-edge/0411/The-Fab-Five-South-Africa-Joins-BRIC.aspx), South Africa’s addition may surprise some.  It’s smaller by population and size of its economy than the original four.  But it does represent a link the emerging economies throughout the continent.  (In fact China and India are already active investors throughout the Africa.  This extends their ties.) Radcliffe points out the addition of South Africa gives this group of developing (and emerging) economies representation on three continents along with a strong presence (Russia) in Eastern Europe.   

While articles will explore what this means for investors, the major industrialized nations, and the world trade agreements there’s another question to consider:  What will this mean for South Africa?  Writing in Times Live,  Abdullah Verachia explores this question in his article "SA needs to step up to the Bric plate."
http://www.timeslive.co.za/sundaytimes/article1043854.ece/SA-needs-to-step-up-to-the-Bric-plate
He considers this an opportunity for South Africa, one that requires thoughtful consideration of how to proceed in order to obtain the benefits of "membership".  He concludes his articles by saying:

“Individuals, companies and countries have to find new compasses to navigate the new economic path. South Africans know the way. It is how we chart that road that will make all that difference.”

We will all watch with interest as South Africa moves from being known to many as the host of a successful World Cup to an increasingly important member of the global trade community.

Where is Orange?

 Walking into the trend area of Linea Pelle, the major leather goods show in Bologna, Italy is like seeing parts of a rainbow spread across the tops of dozens of tables.  Pieces of leather in an extraordinary array of textures and colors are arranged to catch the eye of designers, product developers from around the world.

During the three days of the show almost 6,000 people will view this leather rainbow, note the trends, and then decide what color and textures we’ll see in shoes, handbags, accessories in our stores more than a year from now.  (What we see in Bologna in April 2011 will appear in products in the fall of 2012.)  Attendees shop the booths of nearly 1,000 exhibitors for the leathers, zippers, soles, and embellishments that will decorate handbags, shoes and furniture in the years to come. According to a Florence based consultant who manages footwear production (In Italy and Brazil) for a major American brand,  Linea Pelle has become a must to attend for everyone in the business.

A quick glance around the room revealed an array of colors - corals and reds, greens, beige and white.   There was black and bright blue, even a bit of yellow.  But where was the orange?  I walked the entire space looking for the hot color of 2011 – Orange.  Not there.  Orange nice and bright the color of fruit is THE fashion color at the moment. It has been so popular with the designers that the Wall St Journal even did an article, “Orange Crush” about the importance of this single bright color for spring and summer 2011.
(http://online.wsj.com/article/SB10001424052748704364004576132071856652118.html)

But amidst the hundreds of samples displayed, guiding the creative ideas of thousands of people there was only one small sample in orange mixed with dozens of reds, rose and corals.  A hot color for 2011, invisible in 2012. 

It’s a fascinating experience to walk a show like this.  To see leather cut into tiny strips and woven together into fabric for shoes, pillows or handbags. (We saw samples woven in India, finished in Italy).  To see leather smooth and supple, printed to resemble snake or crocodile, or cut in intricate patterns by lasers.  The variety of textures and colors seem endless. Showroom after showroom filled with rainbows of pieces that catch your eye and stimulate your imagination.  What will someone do with that you wonder as you look at a piece printed with a grey/white/black camouflage pattern (the style is named Vietnam) or a plastic seeming sample that has a page of newspaper embedded in it (Can we make you a handbag with the newspaper of the day you were born?).

Attending this show was a special privilege. It was exciting. Overwhelming.  Inspiring.   But as I left I was still wondering – where was orange, why did it vanish? 

Travel is a Collection of Questions

Paul Theroux writing recently  in the New York Times ("Why We Travel") 

(http://travel.nytimes.com/2011/04/03/travel/03Cover.html) 

proposes that travel, even when difficult or dangerous enriches the life of the traveler.  I agree.  Our voyages near and far, short and long can educate, inspire and refresh us.

But there’s another side to our adventures.  Travel can also exhaust even an experienced traveler.  Some days I think of a trip as a series of questions:  how will I find food I want to eat?   Is it worth it to keep restaurant cards with notes that say “Great Pasta!”, spend an hour searching to find the place again, only to discover that the chef changed and the pasta too?  Which restaurant will delight?   Do I keep all the other cards or not? 

And then there’s the process of getting some place when you decide not to just hop in a cab.  How do I navigate the metro, the bus or the walk?  If I have a destination in mind, and I find my route using a map, directions from Map Quest or Google maps  -  where will I find the names of the streets?  Will they be on a street corner sign?  On the side of a building? Carved in stone?  Written on a metal sign? 

And those queries don’t even touch the basics of how will I open the door to my hotel room?  A traditional key?  A card I slide into an opening placed on the door?  Do I wave the card by a card reader that isn’t identified as such?  (Will my hotel be nice enough to place instructions in the elevator or not?)  And once I’m in how will I turn on the lights?  The TV or radio?  Will there be a clock? 

Outside the room  we wonder how to manage the money that isn’t familiar especially those coins that collect so quickly?  How to tip fairly, to whom and when?  Can we use the words of Italian, French, Polish or Chinese that we practiced at home and be understood? 

Some days travel is an endless series of questions.  But once we find even a few answers we remember the exciting, mind expanding experience that is travel – Adventures big and small that fill our lives with new images, sounds, tastes and knowledge.  Where shall we go next?    

Giving is Good (but what are the rules?)

As I am about to embark on a trip where I am the banker, in charge of paying the bills and distributing the tips Kevin Salwen’s article in the New York Times “When to Get Your Wallet Out”  http://travel.nytimes.com/2011/03/13/travel/13prac.html  caught my attention.  

What to tip, when and how much is always a question as we travel whether its near home or across the world.  We can check out the “rules” by doing a quick Google search for Tipping rules.  Among the guides you’ll find a country by country list ranging from Croatia to Saudia Arabia at   Conde Nast Traveler Etiquette 101 Tipping Guide http://www.concierge.com/cntraveler/articles/500117.  A quick read will tell you that in Dubai as in Paris your restaurant bill will include a service charge but its considered polite to add a bit if you think your service was good.

But what these guides don’t tell us is think about the purpose, the intention of the money we give.  Are we just saying thank you for delivering fresh towels or are we aware that we’re providing part of the salary that will feed the family of the person who opened doors for us?  They don’t help us distinguish between being generous, appreciative of service provided and appearing to be a traveler showing off your wealth?   There aren’t any Etiquette 101 practices to address this part of the tipping equation.  As Mr. Salwen points out the decisions are personal based on our budgets often our feeling at any given moment.  Are we trying to invest in the local economy, help the street vendor build his business, establish a relationship that will lead to better service in the future? 

Tipping, giving money for something received isn’t confined to restaurants, cabs and hotels.  My favorite way to support the local economy is to give a “donation” to people playing music in the subway, on a street corner.  They brighten my day (a great service) and I appreciate the effort it takes to perform in public. Plus I believe that the world needs music.  My few coins may help keep it available for other travelers.

Before you board the plane or boat, get in the car, or hop on your bike for the next trip, check out your own philosophy about tipping as well as the standard practices at your destination.

Where is Baggage Claim?

Although Las Vegas now has serious competition from resorts in Singapore, (see the rececent Economist article www.economist.com/node/18231454) and other parts of the world it still attracts almost 40 million visitors each year with approximately 5,000,000 coming from places outside the US. 

Looking around at the crowds walking the strip or people in the casinos sitting in front of the tables and slot machines its not easy to identify which countries are represented.  The uniform for everyone seems to be jeans with a top – shirt, sweater, or jacket.  But as you walk around the sounds of the conversations reveal that visitors likely have traveled a distance to enjoy the shows, restaurants, shops and gambling opportunities.  Within hours of arrival the sounds of Spanish, French, and Italian mingled with the bells of the slot machines.  We overheard parts of conversations in Chinese, German, and heavily accented English.   Visitors came from Sweden and Israel and beyond attending conferences, on vacation or following the NASCAR races.

And yet, with all the international traffic the airport (McCarran International www.maccarran.com) which offers lots of slot machines didn’t appear to have a single sign that In any language but English.  Not even as Memphis airport (www.mscaa.com) did, a sign marking the exit in multiple languages.  While it is reasonable to assume that most travelers know a few words of English, how much more welcome they might feel if signs at the airport welcomed them, or made the search for food, baggage or restrooms a little easier by offering a choice of languages.