Welcome to your weekly supply chain digest, where we break down the latest trends affecting businesses in Nigeria and across Africa. Brought to you by XNECT HUB – Your source for market and supply chain intelligence. We’re here to keep you informed, without the jargon. Let’s dive into the highlights for the first week of November ending Tuesday 7th November, 2023.
Ranking the Impact: Green Zone, Yellow Zone, and Red Zone
We understand that navigating the complex world of supply chains can be challenging. To make things easier, we’ve categorized the latest news and data into three zones based on their potential impact like the colors of traffic control lights. This ranking will help you better understand which trends may have a significant effect on your business and which ones are less likely to disrupt your operations.
No.1 – In the Green Zone (Least Impact)
In this zone, we explore trends with the least impact on supply chains. They’re noteworthy but won’t shake things up significantly or affect the smooth functioning of supply chains.
No Fly Zone
There were no significant trends with least disruptive impacts on supply chains in Nigeria and other Sub-African countries in the last week of October
No. 2 – The Yellow Zone (Moderate Impact)
Moving into the Yellow zone, we highlight economic indicators and industry trends that have a moderate impact on supply chains. These factors may cause some marginal positive/negative disruptions or challenges but are not severely detrimental to overall supply chain operations.
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Investments in Data Centers in Nigeria
Sectors Affected: Technology and IT Services, Government Agencies (MDAs), E-commerce and Banking
Countries and Locations: Nigeria (Lagos, Abuja, Kano)
Investments surpassing $230 million have been made in Nigeria’s data center sub-sector. However, persistent challenges include poor capacity utilization, power supply issues, forex shortages, and multiple taxation. Only 1% of global data centers are in Africa, despite the continent having 17% of the global population. (Learn More)
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Blockchain Integration in Uganda’s Trade Ecosystem
Sectors Affected: International Trade, Agriculture
Countries and Locations: Uganda
Uganda’s new partnership with TA-CargoX to establish the TradeXchange platform using blockchain for trade facilitation promises increased trust, reduced fraud, enhanced transparency, and smoother trade processes. The new deal aims to position Uganda as a modern player in the global market. (Learn More)
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Kenya’s Retail Industry Growth
Sectors Affected: Retail, Consumer Goods
Countries and Locations: Kenya
Steady growth is expected in Kenya’s retail and consumer goods sector despite economic challenges. Changing consumer preferences, escalating commodity expenses, and diminished savings may impact development. There is a marked emphasis on retail adaptation and changing strategies in projections for Year 2024. (Learn More)
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Figorr’s Insurance Product for Cold-Chain Businesses
Sectors Affected: Cold-Chain Logistics, Insurance
Countries and Locations: Across Africa (Nigeria, Kenya)
Figorr launches insurance product for cold-chain businesses with real-time monitoring technology. Figorr’s new solution aims to protect businesses from financial setbacks and enhance visibility in the cold-chain sector. Partnerships with reliable insurance players in Nigeria and Kenya. (Learn More)
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Quality Disruption in Nigeria’s Cashew Value Chain
Sectors Affected: Agriculture (Cashew Farming), Export
Countries and Locations: Nigeria
Rejection of Nigeria’s cashew at the international market due to quality problems. The disruption of the cashew value chain by exporters, especially foreigners is leading to significant loss of revenue and damage to Nigeria’s image. (Learn More)
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Investment Interest in Abidjan-Lagos Highway Corridor
Sectors Affected: Transportation and Infrastructure, Trade
Countries and Locations: West African region (Abidjan-Lagos corridor)
The Abidjan-Lagos highway corridor project secured a $15.5 billion investment interest. Transformation expected in West African region, promoting regional integration and sustainable economic development as a result of the new finance injection in the project. (Learn More)
No.3 – Red Zone (Severe Impact)
And now to the red hot zone where we highlight economic indicators and industry trends that have a severe impact on supply chains. These are factors that can cause significant disruptions, delays, or challenges in supply chain activities and require immediate attention and mitigation efforts.
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Skilled Worker Shortage in South Africa
Sectors Affected: Engineering, Science, Information Technology
Countries and Locations: South Africa
The acute shortage of skilled workers in South Africa has been identified as the second biggest impediment to economic growth. Delays in the visa process also threaten expansion plans, investments, and jobs. This Skilled worker shortages extend to management-level personnel. (Learn More)
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Frequent Power Grid Collapses in Nigeria
Sectors Affected: Energy, Manufacturing, Services
Countries and Locations: Nigeria
Incessant power grid collapses continue to pose a setback to economic and developmental progress in Nigeria. The country experiences substantial financial losses annually due to power interruptions. Grid failures are attributed to factors like infrastructure limitations and challenges in gas supply. (Learn More)
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Cotton Production and Processing in Sub-Saharan Africa
Sectors Affected: Agriculture (Cotton Farming) , Textile and Apparel Industry
Countries and Locations: Various Sub-Saharan African countries
Africa is a significant cotton producer but exports over 81% of raw cotton. Lack of infrastructure and technology for processing hinders local transformation. The global cotton market is valued at $1.1 trillion, but Africa’s share is low due to exporting raw cotton. (Learn More)
In Summary
Overall, we examined 9 economic trends with varied impacts on supply chains in Africa. While majority of these trends indicate moderate impacts, others, like the skilled worker shortage in South Africa and persistent power grid collapse in Nigeria, pose severe challenges. Policymakers and actors (including businesses) across various supply chains in Africa need to address these issues to ensure financial sustainability, growth and development.
Till next week when we bring you another roundup of BizTrends For Your Supply Chain in Africa, Mafanikio!
