By Fébé Potgieter-Gqubule

DURING the last decade, African countries consistently found themselves amongst the fastest growing countries in the world, spurring the Africa Rising narrative. A key ingredient of the growth was a fast developing and innovative indigenous private sector, with an increasingly pan African footprint. This is recognised in the African Continental Free Trade Area (AfCTA), that amongst other things seeks to “harness the demographic dividend, grow the middle class, increase the use of technology, promote rapid urbanisation and boost opportunities for regional and global value chains for African businesses as strategic drivers of economic growth in Africa.”

The 2020 edition of the Economic Report on Africa, an initiative of the UN Economic Commission for Africa (UNECA), is therefore timely, with its focus on the African private sector. Although the report addresses the issue of financing of the private sector, the chapters which analyse the sector are particularly interesting. Amongst the observations made in the report:

  • The absence of the ‘missing mid- dle’ in the African private sector. There are a number of mega companies, but the overwhelming majority of African private sector are small and micro, with too few medium and large scale companies, largely due to financial con- straints and markets.
  • Despite this constraint, small businesses in Africa account for 90% of all firms and 60% of all employment.
  • The productivity gap between SMEs and large firms is explained by the low-value-added and labour-intensive sectors in which SMEs predominantly operate.
  • The African private sector mainly plays a role in agriculture, industry (including manufacturing) and services.

The financing solutions proposed by the report include recommendations on the role of banks and financial markets to support private sector development. The report for example noted that there are 28 stock exchanges currently in the continent, with the oldest in Egypt, South Africa, Morocco, Zimbabwe and Kenya.

It is clear from the report that if we indeed want to use the AfCTA to boost global and regional value chains for African businesses, more needs to be done at country and regional level, by financial institutions to support the development of the private sector, and particularly small businesses.


Stock Exchanges currently exist in 28 African countries. The oldest are the Egyptian Exchange, the Johannesburg Stock Exchange, the Casablanca Stock Exchange, the Zimbabwe Stock

Exchange and the Nairobi Securities Exchange. (source: Economic Report on Africa, 2020)

To download the Report, please click on this link:


Fébé Potgieter-Gqubule is the General Manager of the African National Congress (ANC). This article first appeared in ANC Today.