Africa’s Prospects Indicators for February 2016

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Monday, March 07, 2016 7:00AM / Nielsen Nigeria

The second edition of the Africa Prospects Indicators (APi) provides a trended ranking of multi dimensional, comparative indicators for nine of Sub Saharan Africa’s leading markets, where common measurement information is available.

The report also assesses macroeconomic and business prospects for 17 other countries where extended metrics exist. The findings, up to Quarter 3, 2015, of the Africa Prospects ranking reveal some interesting, if not entirely unexpected, movement in positions as these dynamic markets respond to ongoing change. Cote d’Ivoire moves ahead of Nigeria to lead the prospects ranking outlook at the end of Q3, 2015. Its ranking improves on the Business outlook dimension, and it continues to rank top in terms of Retail sentiment. Whilst the country comes in third position on the broader.

Macro factors, its stable economic growth and inflation climate and recent elections, provide a fertile investment environment. Its principal prospects for realising growth remain consumer-related elements such as identifying and fulfilling consumer needs, building category, brand and product awareness, as well as trust and recommendation.

More Moderate Views for NigeriaWhilst Nigeria topped the inaugural list in Q1, 2015, in the latest ranking it drops to a more moderate 4th position, driven primarily by deteriorating macro-economic indicators as a result of a slump in commodity prices, in particular oil. In addition, the Consumer indicators and overall confidence levels have followed suit. Despite this, Nigerians continue to be some of the most optimistic consumers on the continent, with more positive sentiment for their job prospects and personal finances, even though immediate spending intentions and levels of spare cash are more strained. Business success in Nigeria is all about efficiently navigating the complex routes to market, pinpointing the optimal outlets to generate the greatest return and working with these retailers to build and activate demand, not a quick or simple task in a market with more than 2-million retail outlets. It is therefore not surprising then that Business executives cite Route to Market and Distribution as their number one priority for the forthcoming year.

Kenya and Tanzania climb the overall rankings to second and third place respectively, with both markets recording improvement on the macro ranking, which takes into account the economic growth performance in relation to the size of the economy. Business sentiment for Kenya remains a little more sceptical, as the ranking declines amidst slower sales off take impacting company performance. Within South Africa, peer ranking improves from 9th (Q1, 2015) to 7th place. The South African economy accounts for the largest base of consumer spend in SSA and has one of the most favorably priced common item baskets. This provides more promising avenues for growth through product innovation and choice, thanks to a greater product/value equation. Retail execution, route to market and distribution are also far more easily achieved in a country with the highest concentration of modern trade on the continent.

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