A Case for West Africa

While the focus of the Africa narrative a decade ago was whether the continent would ever deliver on its latent potential, the shift has been such that the conversation is now about how high this ceiling can be. Africa’s positive outlook and the surrounding sense of optimism have been a boon to the increased focus on the continent, particularly in a global context where developed economies are still recovering from financial turmoil and BRIC nations have not delivered on expected growth. In Africa, there is no longer the sense of a false dawn; instead, there is the vision of a resurgent Africa where economic growth is comparable to or even faster than any other continent and marked improvement in human development is no longer a mirage but is within reach.

Rapidly Growing Economies and Strong Fundamentals:
  • Our two principal focus countries are among the fastest-growing economies of the world1:
    • Côte d’Ivoire / Ivory Coast is the world’s 2nd fastest growing economy
    • Senegal is the world’s 9th fastest growing economy
  • Africa now has the fastest-growing middle class in the world2:
    • By 2060 the number of middle-class Africans is projected to grow to 1.1 billion (42% of the population)
  • Private consumption in Africa is already higher than in India or Russia3:
    • It rose by over USD $550 billion between 2000 and 2010
    • Expected to increase by an additional USD $410 billion by 2020
The West African Investment Opportunity:
Accelerating & Diversified Economic Growth
  • Forecasted average GDP growth of 5.6% between 2016 and 2021 making it one of the fastest growing regions in the world4
  • More than 75% of growth of African economies comes from domestic–oriented industries including telecom, financial services and agribusiness5
Favorable Demographic & Urbanization Trends
  • West Africa has a population of over 350 million, 44% of whom are under the age of 155
  • Population growth of 2.7% and rapid urbanization, currently at 45% and projected to exceed 50% by 20206, creates strong growth for consumer oriented businesses as consumption trends increase
Improved Macroeconomic & Political Stability
  • Average number of serious conflicts in Africa declined significantly from 4.8 per year in 1990s to 2.6 per year in 2000s5
  • Macroeconomic stability improved dramatically, with inflation falling 64% to single digits and fiscal imbalances improving 55% over the last decade4
Underpenetrated Private Equity Markets
  • Regional private equity markets make up less than 0.1% of GDP in Africa; US has 9x greater penetration8
  • Numerous opportunities in Africa’s wave of industrialization: transition from extractive and commodity production industries towards value-added and consumer-oriented industries, targeted towards both export and local markets


  1. IFM 2016 Forecast
  2. African Development Bank
  3. “The rise of the African consumer,” McKinsey Global Institute, October 2012
  4. World Economic Outlook Database 2016. GDP stated in terms of Represents 6 year constant price GDP CAGR
  5. “Lions on the Move,” McKinsey Global Institute, June 2010
  6. United Nations World Population Prospects: the 2015 Revision
  7. “Africapolis: Urbanization Study in West Africa,” Agence Française de Development, January 2011
  8. Emerging Markets Private Equity Association, February 2011