The two themes of the Africa Ireland Economic Forum — agri-business and women in business — resonated with the wide range of African and Irish businesses which gathered in the Convention Centre in Dublin last week.
The Tánaiste and Minister for Foreign Affairs and Trade, Simon Coveney, delivered the opening address, stating: “Since 2014, Ireland’s trade with Africa has increased by 13%. Irish food and drink companies have been particularly successful, with Bord Bia estimating that exports to the continent have gone up by 28% over the past two years.”
The Tánaiste urged more Irish companies to deepen their engagement with the world’s fastest-growing continent. To help with increased engagement, he announced the expansion of the Africa Agri-Food Development Programme (AADP), which assists Irish companies to partner with local enterprises in African countries.
The programme offers funding up to a maximum of €250,000 per company for a full project or €100,000 for a feasibility study.
He emphasised female entrepreneurs, who have not used the fund to date, and encouraged them to apply. The Lady Agri–Development fund came in for special mention. This is the brainchild of Cork woman Hilary Barry.
The fund offers meso–financing — of €50,000 to €150,000 — and consists of venture capital funding, a technical assistance fund, a coaching fund, and a guarantee fund.
Charles Boamah, vice-president of the African Development Bank (AfDB), talked up the enormous potential for trade with Africa, stating that, by 2050, it would have a population greater than China and India combined. The AfDB plays a crucial role in financing the infrastructure necessary to enable the modernisation and transformation of the economies on the continent.
Ireland is not yet a member of the AfDB. However, many of our competitors from Europe, Asia, and the US are also targeting the African market and achieving extensive market penetration, due to their membership of the bank.
Back in 2013, when I was chief executive of the Irish Exporters’ Association, I urged the Government to take out membership of the AfDB, saying it would offer the opportunity to extend our reach and impact in Africa.
On September 27, Minister for Finance, Paschal Donohoe, finally published the African Development Bank and Fund bill, 2018. The bill will provide for Ireland’s potential membership of the AfDB and the African Development Fund (AfDF). Did it have to take five years? But, better late than never.
Pitfalls, however, remain for African-focused investors. Profits repatriation continues to be a difficulty, including the murky area of withholding tax and exit tax. The difficulties in Nigeria — the largest economy in Africa — were carefully avoided at the forum.
In its recent World Economic Outlook report, the IMF identified Africa’s two largest economies — Nigeria and South Africa — as holding back growth across the continent, pointing to rampant inflation, reduced oil-production rates, and contraction in the agricultural sector.
Nigerian elections in February 2019, will continue to create uncertainty and hold back many Irish and international investors, as will cautionary delays, while South Africa’s new president, Cyril Ramaphosa, attempts to kick-start the economy.
Sub-Saharan Africa will need to create 18m jobs each year, until 2035, to accommodate its growing population.
A significant number of these jobs will be created in agriculture and agri-business. Ireland has technology in agri-business that we are ready and able to share.
- John Whelan is an expert on Irish and international trade