Mass grocery retail offerings have developed at a considerable rate since the early 2000s, not only in South Africa but also in Botswana and Namibia, and over recent years in the more nascent markets of Angola, Zambia and Mozambique. This is allowing consumers to access food and drink products at better and more stable price points, and it is also resulting in a rising level of demand for discretionary segments, such as household goods, clothing and footwear, and personal care products. Significant growth opportunities still exist because urbanisation and rising incomes are beginning to shape consumer preferences and demand for products in both essential and non-essential categories.
| South Africa stands out, both in southern Africa and the wider continent, as the leading market in terms of consumer trends and the manufacture of goods as well as the leader in retail logistics networks. Despite macroeconomic challenges and initial uncertainty around the newly formed Government of National Unity (GNU), the retail sector is commencing a gradual rebound and is being aided considerably by the reduction of load shedding (rolling electricity blackouts). Further developing consumer trends, such as convenience and e-commerce, have seen food delivery and e-grocery platforms rise considerably, while retailers continue to invest in both their physical and digital presence. South Africa will continue to serve as a springboard for retailers, and more broadly consumer trends, into the wider southern Africa region. (Consumer Industry Outlook 2024) |
| Cotton: Prices Constrained by Abundant ProductionBenin’s cotton output, the largest in Africa, has stagnated from 2022 to 2024 after years of rapid growth. In response, the government has fast-tracked its industrialization and value-addition strategy, anchored by the Glo-Djigbé Industrial Zone (GDIZ). Recent developments in early 2024 show GDIZ gaining momentum, with a number of international textile manufacturers, including key players from Türkiye and China, establishing operations within the zone. The project, which represents aUSD1.4 billion investment, aims to create 300,000 jobs by 2030 and targets exports to Europe, Asia and North America. Additionally, GDIZ has partnered with Arise Integrated Industrial Platforms (Arise IIP) and other international bodies to enhance the value-added processing of cotton, moving Benin from being simply an exporter of raw cotton to an exporter of finished textiles. Togo is experiencing renewed growth in its cotton sector, with the Adétikopé Industrial Platform (PIA), led by Arise IIP, now in its final construction phases. Expected to process over 100,000 tons of cotton annually, the PIA is set to create around 20,000 direct jobs and has attracted several global textile manufacturers with contracts secured to supply regional and international markets. In early 2024, the Togolese government introduced incentives for farmers, including subsidies and training in sustainable farming practices, which are aimed at increasing raw cotton output to meet the growing demand from PIA and ensuring a consistent supply of raw materials. Smaller cotton-producing nations such as Madagascar, Eswatini and Rwanda are seeing notable growth, driven by |
| rising demand for sustainable cotton and the shift towards locally processed textiles. Investments in organic and Fairtrade certified cotton production have positioned these countries as key suppliers to European markets. In 2023, Madagascar reported a 15% increase in cotton production, primarily due to new irrigation projects and the introduction of high-yielding seed varieties. Meanwhile, Egypt has launched are vitalization program focusing on its renowned long-staple cotton, with support from the EU and the World Bank, aiming to regain lost market share by boosting quality and sustainability standards. (Q3-24 Commodities Outlook) |
*** This article first appeared in the fourth edition of Afreximbank’s TRADAR Club Newsletter