A number of analyses suggest that the largest African markets in 2020 will be Alexandria, Cairo, Cape Town, Johannesburg and Lagos. Each of these markets are likely to have more than $25 billion every year in spending and can be comparable to Mumbai or New Delhi in India. A number of smaller African markets, including Ibadan, Kano, Dakar, are also likely to develop consumer markets worth $10 billion per year.

The consumer facing sectors in Africa will largely be responsible for this growth, these sectors include the likes of telecommunications, consumer goods and banking. A combined $860 million was spent on these sectors in 2008 and it is projected to increase to $1.4 trillion over the next five years if real GDP continues to grow at current pace. As household income grows, consumption will increase in retail banking, telecommunications, food and beverages, and housing. This will, in turn, spur more consumer markets large enough to be attractive to more multinational companies; in many ways, this looks like a virtuous cycle.

To become more mature and viable, Africa’s markets need lots of Infrastructure and this is an opportunity for companies and investors. Africa still has huge power, transportation and water gaps that will require upwards of $70 billion invested in infrastructure per year to bridge. This can be achieved by concerted efforts involving African governments, African and international businesses and investors.

Once this is handled, Africa’s economic fortunes will skyrocket. By 2040, Africa can be home to 20 percent of the world’s young people and will probably have the largest working‐age population.

By Emmanuel Iruobe