The pace of the recovery will vary significantly among the Sub-Saharan Africa outlook in 2021. Angola and Nigeria face feeble growth because of pronounced reliance on oil that will cause lingering harm to exports and public finances. South Africa’s economy will be hamstrung by fragile consumer sentiment and electricity shortages that will curtail manufacturing and mining activity. In contrast, Kenya, Ghana, and Côte d’Ivoire will rebound rapidly owing to high levels of investment, relatively diversified exports, and favorable conditions for consumers. Meanwhile, businesses face elevated inflation and sustained currency volatility amid a patchwork of enduring lockdown rules that will present route-to-market challenges. In 2021, businesses will need to re-evaluate resource allocation across their market portfolios to ensure a return on investment and consider offering financial support to priority customers and distribution partners to ensure business continuity.
Economic performance will diverge markedly across the region through 2021. The region is likely to experience a delicate, multispeed recovery in 2021. Fragile recoveries in Nigeria, Angola, and South Africa will contrast with healthy rebounds in Kenya and Côte d’Ivoire. Businesses will need to reinforce their positions in larger markets while assessing how to capture growth in smaller—but faster growing—markets.
Lingering COVID-19 containment measures will cause planning and route-to-market difficulties. COVID-19 containment measures will be lifted at different speeds, creating a complex and constantly changing patchwork of rules and regulations that will complicate business planning well into 2021. Strict lockdown measures are unlikely be reintroduced, because SSA governments will not be able to tolerate the resulting socioeconomic costs.
Currency woes will exert pressure on local partners and customers. Currency volatility will continue through 2021, creating planning difficulties for businesses and their partners. It will also reduce the price competitiveness of imported products, making customers more inclined to trade down to cheaper alternatives. However, the extent of this volatility will vary considerably across the region.
Download an executive summary of our 2021 Sub-Saharan Africa Outlook for a full breakdown of the global drivers of the region in 2021 and how you can mitigate impacts to your business:
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