SupplyChain Africa | July 2022

Editor’s Notes

If Africa’s supply chain gaps were evident prior to the pandemic, they became urgent and pressing during the health emergency.

In the months since, global supply pressures have begun to ease, while several African nations contend with a bigger financing gap and weaker trade flows. The business environment is still on its road to recovery, yet innovation in the logistics and supply chain sub-sector has been accelerated. Core supply chain services have witnessed innovation in the middle-mile, ports and cargo management, health distribution, and brokerage subsectors. Other industries have included or completely transitioned into virtual supply systems. Some of such innovation examples are highlighted in the following pages. This edition also explores insights into gender participation, supply infrastructure and the continent’s investment hotspots.

Iam excited to introduce our maiden magazine edition headlined COVINNOVATION (from two words; Covid-19 and Innovation). The term covinnovation was created to describe innovation inspired or forced in response to the Covid-19 pandemic. This headline and by extension the magazine birth fresh beginnings in multiples. This being the first edition of Supply Chain Africa, our purpose was to explore answers to the question of where and what are the current states of African Supply Chains? What are the growth pathways and critical data sets relevant to the new normal of living and business in Africa after a global health crisis?

Shortly before the global lockdowns, heightened regulatory and business interest in African supply chain infrastructure, policy and trade facilitation was driven by the launch of the Africa Continental Free Trade Agreement ‘AfCFTA’ which was purposed to be the vehicle for supply sector innovation on the continent. During the pandemic, focus shifted to ineffective distribution and local manufacturing gaps, first evidenced in the scarcity of protective gear such as face masks, personal protective equipment etc. followed by supply shortages across almost every sector of the economy.

Our vision, to deliver a holistic African supply chain perspective that advances life and business in Africa; hinges on the conviction that African supply chains are geographically, culturally and, technology-stage nuanced, in ways that require alternate approaches to sustainable development. We are building Africa’s supply intelligence platform and invite you to join our community by following our social media handle on LinkedIn @ supplychainafrica

I am delighted to host the Supply Chain Africa podcast series commencing in June this year and to bring you future editions of the magazine which will include critical data sets that support your business objectives. Remember to subscribe to our newsletter and podcast using this link . To partner with us and/or feature, please send us an email at pr@supplychainafrica.org

Izin Akioya Editor-in-Chief

COVID-19 + INNOVATION = COVINNOVATION

HP

EMMANUEL ASIKA

Country Head - Nigeria & Omnichannel Manager - Africa Central & East (ACE), HP

Q1.

WHAT WAS THE IMPACT OF THE PANDEMIC ON YOUR BUSINESS, OPERATIONS AND BUSINESS MODEL?

At the onset of the pandemic, there was a slowdown in our business operations. By the time COVID became full-blown, this slowdown deepened. At this point, we were focused on “survival” since we were recording the lowest sales performance ever. The lockdown essentially led to zero face-to-face operations, meaning that businesses we previously supplied were unavailable. The catchphrase I adopted to describe the situation was VUCA, short for; volatility, uncertainty, complexity, and ambiguity, which was the operating environment at the time.

Shortly after the downward trend, as people began to embrace remote work, we saw a rapid upward shift in sales performance that translated into my industry benefiting immensely from the lockdown. People began to migrate from single device use to multiple devices use at home. And because we sell laptops, computers, and printers, this meant increased sales. Quickly, our vision to get one device into every household pivoted to multiple devices because households demanded more devices, and computers with increased capabilities for teleconferencing like Zoom, WebEx, etc that entrylevel laptops could not provide. This meant upgrades from entry to mid-high-level devices within the period, essentially increasing our high-value segment sales performance.

This accelerated growth came with its challenges, it exposed the fragility of our supply chains as demand outstripped supply and sales projections due to the prevailing global production shortfalls and logistics standstill.

Q2. HOW DID YOU REORGANIZE YOUR SUPPLY/ SOURCING PROCESS TO PLUG THE GAPS AND MEET CUSTOMER DEMAND?

The reality is that a lot of collaborations and alliances

go into making a single laptop. Our third-party providers were also hit by the pandemic, causing shortages. People and factories were shutting down including one of our major suppliers, situated in China.It became evident that we needed to invest in overhauling our supply chain capabilities, increasing supplier visibility and integrating technology to improve transparency, tracking and forecasting. An applicable example today is Ukraine, where some key components are being manufactured. Dependence on that cluster has proven to be a problem.

Typical supply chains are built for efficiency thus giving minimal room for buffers. When the system is hit as it was during the pandemic, businesses then realize their vulnerabilities and have nothing to fall back on. Our response has been to explore a diversified sourcing strategy that will enable us to effectively serve our customers while balancing cost efficiencies.

Supply transparency has also become a key strategy for us, we are building capacity to improve visibility of transit locations by leveraging digital capabilities, and predictive Artificial Intelligence “AI”, as well as having robust conversations with all of our suppliers and supply chain experts to ensure that we design an efficient process. Contingency planning has also become a key concern. We are in a change process that is enabling us to fulfil backlogs while rolling out a resilient supply chain system. AI holds a lot of promises, but to what degree artificial intelligence will deliver, I think the next couple of years will tell us.

Q3. DID YOUR OPERATIONAL MODEL SHIFT DURING THE PANDEMIC?

Yes, we moved remotely and then eventually hybrid. That was a fundamental shift for us, it was uncharted waters, even though we had begun to experiment with the model in small pockets. We enabled people to work comfortably from home; we invested in ergonomic chairs, backstops and

accessories. It was easy to pivot because remote work, and work in transit had already been part of our corporate culture. Recently, we have adopted a hybrid working policy, and this has improved productivity in Sub Saharan Africa, where electricity and road congestion are a problem. People can either work from home on in-office depending on their work scope and peculiarities.

Q4. HOW IS HP BUILDING SUPPLIER CAPACITIES WITHIN ITS VALUE CHAINS?

Part of our transformation focus is to deepen supplier collaboration and data sharing through our partner program which we launched about a year ago called AMPLIFi. The primary pillar of this program is collaboration and data sharing because for AI to work, true and clean data is required, and that’s the integrity we’re demanding from our partners and collaborators which will in turn create positive outcomes for all players across our supply value chain.

Q5. IS THE AFRICAN WORKFORCE EQUIPPED FOR A DIGITIZED SUPPLY CHAIN?

Unfortunately, across every sector, it seems Africa only has small pockets of experts on the continent so my answer will be no. Another challenge is how to amplify the supply sector. How do we grow that workforce? Because a lot of people are in survival mode and lack access to superior information, most Africans still want their children to be in typical careers i.e., doctors and lawyers. Regulations and policy are major considerations as well. In an era of digital transformation, African governments should be enthusiastic about bridging the gap in digital access and skills through policies that encourage people to take part in the digital economy. Component manufacturing in Africa for example will solve a huge supply chain problem for many sectors if we build the capacity to do so.

IO MATERIALS SERVICES

MATTEO VOLPI

CEO, IO Materials Services

Q. WHAT IS THE GOAL OF IO MATERIALS SERVICES?

We founded IO Materials Services in 2017 in response to the growing demand from oil & gas and industrial companies to achieve a greater than 50% reduction in their supply chain cost structures. IOMS delivers supply chain solutions that specifically target conditions where negative cost performance is prevalent due to cost and quality of market choices, local infrastructure availability, and complexity of the operating environment (geopolitical, local community requirements, local content, etc.)

Our goal is to drive the adoption of logistics innovation common in the FMCG industry into the oil and gas sector and other heavy goods industries such as renewable energy and mining. We have the capabilities and expertise to provide the efficient benefits of innovation and technology enjoyed by brands such as Amazon into the oil and gas industry. We provide last-mile fulfilment services to the oil and gas assembly line.

Q. WHAT WAS THE IMPACT OF THE PANDEMIC ON YOUR INDUSTRY?

The initial impact was a slowdown in all activities. In Nigeria, our main operation market, there was an ongoing crisis in the oil and gas industry due to falling oil prices and regulatory issues around the Petroleum Industry Bill. The pandemic worsened global oil prices and the ongoing crisis and was

devastating for our startup. Conversely, indirectly, Covid-19 was instrumental in pushing automation and technology adoption in the oil and gas logistics subsector which had previously depended on a manual, paper-based approach. In a lot of ways, oil and gas logistics are disorganised. As a none core area of the oil and gas sector that is yet managed in-house by the majority of oil and gas firms, the subsector is prone to significant wastages and inefficiencies. During the lockdown, oil and gas firms and regulators become more interested in the change process required to automate logistics in the oil and gas industry and close procurement deals virtually. Since the pandemic, we have witnessed the growth of a virtual supply.

The modality of logistics in the oil and gas industry has evolved in the past few years. The warehousing model which was based on one-location assembly and warehousing has become a lot more flexible. One-stop massive assembly points are giving way to dynamic sourcing, local sourcing and just in time sourcing pathways. As a result, local firms are becoming more involved in the supply of inputs in the oil and gas sector, which is good for the industry. Not all the materials come from overseas anymore, thus the classic assembly point model has become a lot more diversified

Q. WHAT ARE THE OIL AND GAS INDUSTRY PRIORITIES AFTER COVID-19?

Optimisation has become a front-burner issue in the industry for years and even more so since the pandemic. NAPIMS started

the Nigeria Upstream Optimisation Process ‘NUCOP’ as a means of driving integration and optimization across the industry. The union of oil-producing companies in Nigeria also has an initiative with the purpose of creating savings together.

Cost reduction has always been a topical concern in the oil and gas industry and this concern became even more urgent due to the pandemic which led to a free fall in oil and gas prices. Covid-19 gave the last push, the industry is no longer just looking at cost reduction as an option it has become an important priority. From both a regulatory and private sector perspective, there is a commitment to sustaining a $20 per barrel industry and that affirms a place for a logistics services provider like IO materials to create a lot of value through technology and process improvement in the logistics supply chain.

Q. HOW HAS THIS AFFECTED YOUR ORGANISATION?

We believe we are at the right place and time for the shift in the oil and gas industry. We are partnering with the oil and gas sector not only to provide consulting services but to also operationalise innovative supply chain processes to drive efficiency gains on behalf of the industry players. Logistics is really problemsolving, and that is our area of expertise. We believe the oil and gas industry is a critical sector that will remain relevant for years to come. The meaningful impact will come from automating the oil and gas logistics subsector, combined with environmentally friendly processes.

“

Local firms are becoming more involved in the supply of inputs in the oil and gas sector, which is good for the industry. Not all the materials come from overseas anymore, thus the classic assembly point model has become a lot more diversified

VillageReach

SIMBA NYANYIWA

Senior Manager- Supply Chain (Global Technical Team), VillageReach

Q. PLEASE TELL US ABOUT VILLAGEREACH

VillageReach transforms healthcare to reach everyone. We co-develop people-centered solutions that transform health care delivery by building tech-enabled pathways to primary health care, making products available to people, and by driving sustained impact.

Q. HOW DID THE COVID-19 PANDEMIC AFFECT YOUR ORGANIZATION?

The pandemic was associated with numerous restrictions and affected how we work with our partners. We adopted policies to ensure the safety of our staff in the countries where we work and compliance with government policies to control the pandemic. Travels were restricted and a virtual working style was adopted. To ensure we were able to financially operate, we assessed the implication and potential impact of the pandemic on our bottom line and devised measures to ensure we are continually able to do our work and maintain our human resources over the period of the pandemic

Q. WHAT WAS THE BIGGEST SHIFT/CHANGE IN YOUR BUSINESS MODEL AS A RESULT OF THE PANDEMIC?

One major change is the adoption of a more flexible working environment. The pandemic revealed that you do not need to physically work from the office to achieve impact at scale—remote working arrangements are equally effective. This also enhanced communication between the teams to aid alignment to the progress of work which further ensured that there is more internal socialization of work and comprehensive inputs/reviews from team members.

Q. WHAT OPPORTUNITIES WERE PRESENTED?

A number of opportunities became apparent:

1. Radical collaboration to transform health at a greater magnitude. The different skill sets of organizations can be leveraged and harnessed to impact health at a greater scale. One example is our collaboration with a number of partners through the Covid 19 Action Fund for Africa to protect Community Health Workers (CHWs) on the frontlines of Africa’s COVID-19 response.

2. Supply chain resilience. The pandemic strengthened the conversations on how to make the supply chain resilient in pandemic situations.

VillageReach through a catalytic Supply Chain Integrators Investment from BMGF has been able to develop a resilience framework.

3. Growth and extension of existing solutions to cater for pandemic-related needs e.g. usage of drones for faster service delivery and social listening for health centres by phone to inform demand generation in Malawi.

Q. HOW HAVE THESE NEW APPROACHES IMPROVED YOUR BUSINESS IN RECENT TIMES?

Yes, our staff are very motivated. Recent well-being and belonging survey conducted among staff showed consistent improvement, from previous years, across objectivity, growth mindset, and belonging.

Q. WHAT CHANGES HAVE PERSISTED AFTER THE PANDEMIC?

We continue to remain flexible in our operations

Q. HOW IS YOUR ORGANIZATION ENABLING INNOVATION IN SUPPLY CHAINS?

VillageReach continues to explore opportunities to build tech-enabled pathways to primary health care, making products available to people, and driving sustained impact. Our approach:

• We start by learning what people need from the health care system, building solutions that start at the last mile. This co-creation fosters ownership and positions solutions for success due to ease of buy-in.

• We develop and evaluate solutions in a small set of core countries in sub-Saharan Africa where we have deep experience, relationships and a commitment to long-term presence. We align solutions with government priorities, plans and policies. This approach ensures generation and availability of evidence for the innovations.

• We work with government, partners and the private sector to scale proven solutions in an efficient and sustainable way and transition our support for these solutions.

• We accompany our partners as they sustain and manage the solutions over time.

• We use our work in core and partner countries to replicate proven solutions, develop an evidence base and advocate for global change.

AFRIGILITY GEORGE GICHUHI

CEO, Afrigility

Q. WHAT WAS THE IMPACT OF COVID 19 ON SUPPLY CHAINS IN YOUR COUNTRY KENYA?

Supply Chain Infrastructure in Kenya and possibly across Africa had reached its maximum elasticity prior to Covid-19 and the pandemic made that apparent. Despite the growth of internet penetration and e-commerce retail in Africa over the past 10 – 15 years, especially in countries such as Nigeria, South Africa, Kenya and Egypt, not much had changed in Supply Chain Infrastructure. Real estate asset quality, availability and management have remained in the same state they were 60 years ago. This includes critical delivery and distribution assets such as roads and warehousing. In essence, supply chain assets and management did not evolve to match the digital innovation wave. E-commerce technology has introduced automation into the supply journey for buyers and sellers, yet the fulfilment process has remained mostly manual. This infrastructure gap and incompatibility became apparent during the first few months of the pandemic.

Q. HOW DID THIS AFFECT YOUR COMPANY?

We ran a last-mile delivery company before Covid-19 that primarily transported single to medium size orders to the end consumer. During the lockdown, beyond the restriction on movement which obviously affected our business model, we witnessed massive shortages in inventory levels within the business to the business’s supply chain. Brands could not source their supplies, in cases where the products were available, they were warehoused in regions that required up to 72 hours of travel distance which could not be achieved during the lockdown. This gave us the idea to explore the business-to-business angle.

We realised that the steep entry cost of warehousing and the absence of automation in the fulfilment process was a major stumbling block to e-commerce retail and that presented an opportunity to build a technology-enabled solution for flexibility and scalability within the supply chain. We tasked ourselves with developing a solution that will bridge the gap for both the warehouse asset owners and the e-commerce brands. We pivoted our business in this direction and now provide an integrated order fulfilment service across three areas;

• Low entry cost, short-tenured, flexible microfulfilment warehousing networks similar to the Amazon model aimed at cutting down delivery timings to 6-8 due to warehousing proximity

• Warehouse management and automation to simplify processes, enable real-time inventory management for both the brands and asset owners and maximise warehouse capacity through aggregate warehousing

• Integrated last-mile transportation partnerships to complete our offer as a onestop end to end order fulfilment partner

Q. HOW HAS THE INNOVATION IMPACTED YOUR ORGANISATION’S PERFORMANCE AND WHAT DO WE EXPECT IN THE NEAR FUTURE?

For us, the pandemic triggered innovation and a complete shift in our business model and that has begun to drive traction for us and the brands we have since partnered with. We are working with Duhqa (see duhqa.com), Trokical brands, a manufacturer/distributor among other brands in the pipeline in Kenya. Our greater goal is to help MSMEs in Africa tap into flexible and scalable resources they wouldn’t ordinarily access, to excel

in logistics, warehousing and fulfilment enabled by technology

We work closely with brands to improve their fulfilment processes thus freeing them from the logistics component of their business operations which then allows them to focus on their core capabilities. We are disrupting the supply chain industry through technology that provides realtime inventory data to brands, and asset owners alike, and creating a new warehousing model that did not exist. We have engaged with the insurance sector to develop appropriate products to match the micro-fulfilment model which is designed to accommodate the storage needs of small brands that may require storage services for as little as one week. We are de-risking warehousing

investment for the asset owners, by aggregating small business storage which maximises capacity usage.

We are in our early stages, and we have gotten a lot of traction and scalability and are gearing up for our pre-seed fundraiser to support technology development and capacity building.

Q. WHAT WAS THE BIGGEST SHIFT/CHANGE IN YOUR BUSINESS MODEL AS A RESULT OF THE PANDEMIC?

We went from a pure last mile-transport business to on-demand warehousing and fulfilment which affects the whole cycle of operations and customer experience.

Q. FROM A CONTINENTAL PERSPECTIVE, WHERE DO YOU SEE AFRICAN SUPPLY CHAINS IN THE NEXT FEW YEARS?

I am looking forward to a lot more innovation in supply chains across the continent, cross border trading within the region is still inefficient and the pandemic made it evident that we need to become less import-dependent. The recent war in Ukraine also shows how dependent we still are on imports from other parts of the world. Innovation from a regulatory perspective is very important in this regard. I am looking forward to the impact of the AfCFTA cross border export and manufacturing. Resource-rich African countries should be able to process goods and easily distribute them on the continent at a friendly rate and in good time.

I am looking forward to the impact of the AfCFTA on cross border export and manufacturing.

“

Chances are that when you run a Google search for the keywords, “Top Sea Ports in West Africa”, Togo tops the list. At first glance, the small West African nation might seem out of place among larger nations like Senegal, Ghana, and Nigeria. However, on a closer look, one would discover that this country doesn’t make the top of this list by error.

Sure Togo’s position invites an obvious question: How did the port of a small nation like Togo - (not as rich or advanced as other West African countries) manage to outrank the ports of larger economies in the region?

To understand Togo’s current port ranking, we must cover a quick history lesson of the region’s

Before 1967, Togo was nothing more than a lighterage port exporting phosphate, coffee and agricultural products like coffee bean, and groundnut. In 1967, the country’s port experienced major changes after an artificial deep-water harbour designed for 400,000tn of annual traffic was established by a German consortium. This new harbour inaugurated in 1968, would further undergo developments in 1981 and decades after. French company - Groupe Bolloré subsidiary SE2M Togo was chosen to manage the construction of a third quay for the port in 2011. The project which cost 300bn CFA francs ($600m), centres on a quay 450m long and 15m deep

From 2014, Groupe Bolloré, as well as the situation of the port of Togo, would undergo

Togo: Africa’s Top Port Country

profound change. A 2014 article challenging Boloré’s monopoly over the transhipment business in the area gave way to a new agreement and construction of the Lomé Container Terminal (LCT) worth EUR225 million - including a 1,050 and 1,350-metre long quays. The opening of the Lomé Container Terminal paved the way for Lomé to become West Africa’s biggest port by 2017. The LCT alone processed 75% of all the cargo going through the port of Lomé - 890, 000 TUE annually. The Port of Lomé also tripled its capacity from 311 500 containers in 2013 to 1.1 million in 2017, according to data from Dynamar, a Dutch maritime intelligence and consulting firm. In a report according to the United Nations Conference on Trade and Development

(UNCTAD), Togo ranked top five in terms of port connectivity. TIL Terminal Investment Limited’s (owned by MSC) investment of US$380 million has caused the expansion of the Lomé’ Container port to handle post-panamax vessels and act as a transshipment hub.

Although the West Africa region is experiencing a decline from its compound growth of over 10% in recent years, the port sector was projected to grow by 5% from 2021. Already, major West African countries are competing to outdo each other and become number 1 hub in the region. These countries are working on a line up of ambitious port projects.

For instance;

Nigeria has already recorded significant progress in moving its container shipping operations from Apapa/Tincan to Lekki - located at the Lagos Free Trade Zone. This US$1.5 billion port project in Lekki port is expected to open for operations in 2023.

In Ghana, a joint venture between the French company Bolloré and APM Terminals (Maersk) is in motion to secure US$1.5 billion funding for Ghana’s Tema Port - to operate container ships carrying up to 18,000 containers.

Abidjan’s US$930 million and 1 million TEUs-worth Ndayane Le Port du Futur Dakar port project in Senegal, are a few examples of port expansion projects taking place in West Africa.

Notwithstanding, Togo’s current lead in this race of ports in West Africa is not without evidence - the port is wellconnected and goods can be delivered to several West African capitals in a single day. In addition to being the first modern transshipment hub in West and Central Africa, Togo’s developed port has helped to expand the maritime sector, and stimulate competition in the regional shipping and logistics market.

Port tax revenues contribute to the local economy, an estimated 1,200 direct jobs and 2,500-3,000 indirect jobs were created during the construction of the LCT.

• Top-10 ports in Africa in 2019 (by volume in TEUs)

• Ports and Harbours: The Ports of West Africa Benin, Togo, Ghana and Cote D’Ivoire

• Port Series: Lomé, Togo

• Wikipedia: Togo

• The Main Ports Pushing For Number 1 Regional Hub In West Africa

• A day in the life of Lomé Port in Togo

• 27Avril

Togo’s Port of Lomé becomes regional transit hub

• The Main Ports Pushing For Number 1 Regional Hub In West Africa

• The never-ending congestion at Nigeria’s largest port is starting to get very expensive

• The Raging Hub War at West African Ports

• Lome Container Terminal, Togo

Sustainability in African Supply Chains

Effective supply chains drive regional and global trade participation, facilitate competitiveness and enhance both business and end-user satisfaction. In recent times, with increased public awareness and scrutiny, sustainable supply chain practices can result in competitive advantage for players. Consumers have boycotted brands with negative sustainability reputations, investors also increasingly benchmark corporate participation/funding based on

sustainability metrices. Moreso, the positive correlation between sustainable supply chains and long-term economic growth has been established over the years.

Sustainability is beyond climate change and carbon emissions. The Brundtland Commission of 1987, which was part of the UN World Commission on Environment and Development, defined sustainability as “a development that meets the needs of the present without compromising the

The UN defines supply chain sustainability as “the management of environmental, social and economic impacts and the encouragement of good governance practices, throughout the lifecycles of goods and services.”

Sustainability Venn Diagram

Society/Social Performance Environment/ Environmental Performance

Sustainability Economy/ Economic Performance

ability of future generations to meet their own needs.” The UN defines supply chain sustainability as “the management of environmental, social and economic impacts and the encouragement of good governance practices, throughout the lifecycles of goods and services.” A sustainable supply chain would be enabled to respond to the shortterm demands without compromising on long

term financial, social, and environmental performance, or while maintaining the well-being of the economy, environment, and society, as Elkafi Hassini, a professor of supply chain management in Canada, puts it.

The UN identifies ten principles of supply chain

sustainability:

• Businesses should support and respect the protection of internationally proclaimed human rights

• Businesses should make sure that they are not complicit in human rights abuses

• Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining

• Businesses should uphold the elimination of all forms of forced and compulsory labour

• Businesses should uphold the effective abolition of child labour

• Businesses should uphold the elimination of discrimination in respect of employment and occupation

• Businesses should support a precautionary approach to environmental challenges

• Businesses should undertake initiatives to promote greater environmental responsibility

• Businesses should encourage the development and diffusion of environmentally friendly technologies

• Businesses should work against corruption in all its forms, including extortion and bribery

Apart from the reduced environmental impact, which, contrary to popular perception, leads to big savings, sustainable supply chain has immense benefits:

• Some studies indicate that organizations with the highest investments in the three pillars of sustainability also experience the largest and most stable economic growth.

• Reducing waste and increasing efficiency of machineries and real estate leads to savings in labor and material costs.

• Sustainability reduces operational and marginal costs from improved environmental and business efficiencies.

• Diversity of supply chain improves continuity of supply and avoids over-reliance on a single link in the chain, preventing costly downtimes and reputation damage.

• Sustainability also improves reputation, which enhances business growth and reduces the risk of detrimental effects on profit from boycotts.

• Sustainability creates new business opportunities. The potential for new partnerships with other related businesses in the value chain that are aligned on sustainability values is highest.

Sustainability creates new business opportunities. The potential for new partnerships with other related businesses in the value chain that are aligned on sustainability values is highest.

Focus on Africa

According to research by the Africa Academy of Management and the International Forum on Sustainable Value Chains, the escalation of social, political, and ecological problems in Africa since the end of the 20th century has impacted the continent’s potential to contribute demographically, politically, socially, and economically to global prosperity. Even though the continent has the youngest average age, and is a focus of global development and investments, it does not measure well on sustainable supply chains: African countries are below the levels of other world regions in environmental, social, and economic performance.

Infrastructure Overall, Africa’s infrastructure needs a state of emergency, and poor infrastructure leads to logistics and supply chain inefficiencies, inhibiting not only the flow of goods from manufacturing to consumption, but the talent

supply chain as well. According to the African Development Bank Group (AfDB), Africa has the lowest electricity access rate in the world. Over 640 million Africans have no access to electricity. Despite significant financial investments, road transportation across Africa is still challenged by a combination of poor road infrastructure, insecurity, and border control issues. While the world average of paved roads is 944 kilometers per 1000 square kilometers, in Africa, according to the World Bank, there is an average of 204 kilometers of paved roads per 1000 square kilometers. The continent’s road traffic injury fatality rate is 32.2 per 100,000 people, compared to between four and eight deaths per 100,000 people in countries like Sweden, the United Kingdom, and France. African roads are the most dangerous in the world. Air travel within the region is one of the most expensive in the world: it could be cheaper to travel from Lagos to London, than to travel from Lagos to Kinshasha.

The continent needs to improve shipping networks, and integrate road and sea freight to accelerate the movement of goods within the region. African ports are still plagued with long cargo clearance times, under-developed port infrastructure, and container and cargo theft. For example, despite being the busiest terminal in West Africa, the Apapa port in Lagos can handle only 22,000 TEU of containerized cargo and the average waiting time for shipping liners is over 25 days at the container terminal due to long clearing times. Upon landing, African countries lack the extensive road networks that facilitate delivery, for instance, it can take up to 30 days to move heavy generator equipment from the port in Lomé to the neighboring country of Burkina Faso, a trip that should ideally take three days.

Insecurity & Corruption

Insecurity is another major impediment on the continent. Evidence points to a systemic pattern of political instability that often disrupts supply chains in countries where inhabitants are widely dispersed. Large geographical spreads with small and dispersed populations have inhibited the establishment of strong governments that can control their borders while facilitating sustainable supply chains.

Intra-African trade records frequently understate the amount of trade on the continent, partly because of the lack of adequate data management technology & infrastructure, and significantly due to the high rate of smuggling which allows a substantial amount of traditional border trade to continue unrecorded. Smuggling and human trafficking across the continent are enabled by bribery and corruption at the different borders and worsened by trade restrictions between neighboring African countries.

African businesses lag behind in measuring, reporting, and addressing sustainability concerns, issues, and problems. In Kenya, for example, only 0.05 percent of all registered businesses in the country are accounted for in the national Global Compact Network, even though the country is a strong exporter. All these limits the continents participation in strategic partnerships and collaborations for economic growth.

Market Participation

Are African countries the weakest market participants? Africa’s share of global trade has remained low in value and volume share performance, despite the global trend of export and trade participation from developed to

Digital technology innovation also lowers the barrier of entry into sustainable practices, and opens the talent and services market in Africa to the rest of the world, eliminating visa and travel requirements for participation.

emerging economies. Within the region, the share of intra-African exports as a percentage of total African exports, which increased from about 10 percent in 1995 to around 17 percent in 2017, is particularly low low compared to Asia (59%) and Europe (69%) . This gap is indicative of an opportunity for new growth. What are the opportunities for repairing and strengthening supply chains in Africa?

Digital Technology

Digital technology enables sustainability in supply chains. Internet penetration in sub-Saharan Africa has grown tenfold since the early 2000s, compared with a threefold increase in the rest of the world. Technology hubs are springing up at an incredible rate, with more than 50 percent year on year growth recorded in recent years, and more than 600 of these hubs across the continent. Almost half of the world’s mobile money transactions in 2018 were from Africa, and the continent is expected to lead the fastest growing mobile money technology through 2025, according to the Brookings Institution. Kenya, Nigeria, and South Africa, among the nations with the highest network coverage in Africa, are expected to be the top three markets for smart phone connections in 2025.

Digital technology underscores and enables sustainability. Businesses can use technology to not only reduce the ecological stress generated for each supply chain related activity, but also to aid visibility, transparency, and accountability. From procurement to goods or service deliveries, digital technology can be used with immense benefits. Examples include remote working reducing commute time and carbon emissions from the commutes, robotics reducing human involvement in activities with high operational risks, insight from artificial intelligence reducing sourcing costs and customer satisfaction, technology facilitating better inventory control and reducing waste, and digitization enabling transparency and reducing opportunities for corruption. Digital technology innovation also lowers the barrier of entry into sustainable practices, and opens the talent and services market in Africa to the rest of the world, eliminating visa and travel requirements for participation.

By integrating sustainable practices, companies and regulators can measure performance leveraging digitization; data collection to analyse and interprete for continuous improvement. One example is the use of digital technology and satellite imagery to create individual farm development plans on mobile devices, to guide Ghanaian cocoa farmers over a seven-year period, targeted at improving their productivity and sustainability, which was developed by a coalition of Rainforest Alliance, Grameen Foundation, University of Ghana’s Department of Agricultural Economics and Agribusiness, Touton, and WaterWatch Projects. Digital technology allows for transparency, which strengthens customer trust and leads to increased sales among some customers, with some paying 2 to 10 percent more for products that provide supply chain transparency, according to research by MIT Sloan professor Y. Karen Zheng and assistant professor Tim Kraft.

Yet digital technology alone does not address the system changes needed for sustainable African supply chains

AFCTA

There is no sustainable supply chain without a sustainable supply chain policy. Government policies have the highest impact on supply chain activities, with direct impact on travel, product duty brackets, market size, logistics cost, security, and regulatory compliance. In addition to country specific regulations, regional blocs on the continent operate free trade zones or have special trade relationships that will benefit from clear development policies and leadership around sustainable supply chain.

A sustainable supply chain is dependent on integrated economic, social and environmental systems. This is where the Africa Continental Free Trade Area Agreement (AfCFTA) comes in. Trade analysts anticipate that AfCFTA, aimed at simplifying and reducing duties, human interference, and clearing procedures at ports, would greatly improve supply chain efficiencies. AfCFTA is also expected to unlock Africa’s potential to contribute to global and local prosperity demographically, socially, and economically, by not only harnessing the large market

size of Africa but establishing mechanisms that will allow African economies to create enabling environments to support vibrant businesses without harming people and the natural environment. AfCFTA is not limited to the movement of goods alone, but impacts services as well, since its priority sectors include financial services, transport, telecommunications/information technology, professional services, and tourism.

Conclusion

Economic analysts point to Africa as a choice destination for foreign investments, with opportunities for accelerated economic growth. While still a long way from a sustainable supply chain based on the UN’s ten principles of sustainability, technology, conscious policies, diversification and the AfCFTA’s implementation could realize the continent’s immense economic potentials. Surmounting the challenges inhibiting the sustainable flow of goods and services on the continent will enhance Africa’s global supply chain participation, and competitiveness.

Top Investment Hotspots Africa’s

With a population of nearly one billion, and growth rates that exceed the global average, Africa has huge potential as an economic powerhouse. While much of Africa’s growth has been led by its natural resources, South Africa’s rapidly growing technology industry and Kenya’s financial services industry have spurred significant boosts to their respective economies. Despite the substantial business risks on the continent, investors have begun to look at African markets as for long-term growth.

The region is the fastest-growing continent on the planet and a critical market for global brands, from Apple to Coca-Cola. But where are the best places to invest? Below, we look into the top 9 countries in Africa with promising investment opportunities.

Africa’s Top Investment Hotspots

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Egypt: Ranked second only to Nigeria in terms of the size of its market, Egypt has a sophisticated business sector relative to its neighboring African nations. This is evident in Egypt’s eight-place leap in the World Bank’s Ease of Doing Business rankings, facilitated by government programs such as the white cab initiative, which subsidizes the financing of new taxis to reduce carbon emissions.

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Morocco: Morocco is Africa’s fifth-largest market, growing at an expected 4% over the medium term. The operating environment has greatly improved since the Arab Spring, with Morocco’s reintegration into the African Union and accession to the Economic Community of West African States increasing its investment appeal.

3

South Africa: South Africa remains Africa’s most attractive market for portfolio

investment, especially because many African nations contend with severe liquidity constraints. Although graft and corruption at an executive level continue to hamper governance at state-owned enterprises, South Africa has generally maintained a high level of financial inclusion and its markets have benefitted from rising levels of economic activity in recent years.

Kenya: Kenya’s growth is boosted by a population increase and political reconciliation following disputed elections in 2017. These factors, along with the broadening of consumer demand and urbanization, the country’s membership in the East African Community, and its ongoing infrastructure improvements — including

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an oil pipeline, railways, ports, and power generation — contribute to Kenya’s status as an investment hotspot in the continent.

5Côte d’Ivoire: The country is one of the more diversified economies in Frenchspeaking Africa. Its strong growth rates are supported by government reforms that favor business and a relatively stable political context. Large infrastructure projects, particularly in transport and energy (financed by foreign investment, aid inflows, and the government), also support the country’s strong position as one of Africa’s investment hotspots.

6Rwanda: Rwanda has one of the most favorable business environments in

Africa. According to the World Bank’s operating environment scoring, the country has more than double its business operating efficiency, with its government heavily invested in domestic industries, supported by increased foreign direct investments. 7

Ghana: Ghana’s economic growth will depend mainly on the oil and gas sector, but non-oil growth will pick up as Ghana’s probusiness reforms continue and the country’s power supply improves. Ghana’s political stability will remain consistent due to its democratic credentials. Even though Ghana’s operating environment ranking has dropped recently, it remains one of the easier business environments in Africa.

8

Nigeria: Nigeria leads Africa’s emerging markets due to improving macroeconomics, supported by rising prices oil prices. As Africa’s largest economy in nominal terms, Nigeria presents an attractive market for investors, and with a large consuming population, domestic demand remains high. Rising foreign investment in technology and entrepreneurship is on a high-growth trajectory. The recent liquidity crunch has been alleviated by changes in foreign exchange regulations and commodity price recovery

need for outside investment, evident in changing policies, including plans to open up its highly controlled telecommunications and power monopolies

Conclusion

9

Ethiopia: Home to more than 90 million people, Ethiopia is one of five major economies in Africa and one of the continent’s fastest-growing. Government has been successful in nurturing its key comparative advantage: agriculture and manufacturing. Although the country still prohibits foreign ownership across many sectors, government is slowly changing that policy given Ethiopia’s

The United Nations predicts that by 2050, Africans will make up almost a quarter of the world’s population. That projection, alongside the continents youth demography, growing middle income class and unmatched digital adoption rate sets the context for the continents high return on investment potential in the medium to long term. Africa is poised to leapfrog its development leveraging new technology, and emerge as an economic powerhouse.

The Gender Maze in African Supply Chains

Louise Donova and Refiloe Makhaba Nkune, for the Fuller Project tell the story of 30-yearold Anna, a former seamstress who, losing her job in a garment factory in Lesotho to the pandemic, turned to sex work to fend for her family. For five years, Anna worked hard stitching Levi’s jeans, but the pandemicsweeping through countries, crippling economies and companies - soon saw her company crumble and her jobless. Globally, garment workers like Anna faced continued pandemic-era fallouts

from disrupted financial markets, upended supply chains and clogged ports. As the virus kept consumers at home and shuttered shops, people bought less, and Western fashion brands canceled or delayed billions of dollars worth of orders. At garment factories around the world, staffers were laid off. Anna is one of over 6,000 garment workers who lost their jobs in August 2021, the majority of whom are women.

One factor responsible for this is that we have fewer women in leadership positions and the decision to retain or let go of the services of women in lower-income jobs are majorly made by men.

Inequalities are as old as systems, and gender disparities have been bare and virtually unchanged since time immemorial. The World Economic Forum’s Global Gender Gap report says that the world is now going backwards on its long road to gender equality. The time required is now forecast at 136 years as opposed to the 100 years slated in 2020. A closer look at the report shows that economically, it will take 268 years to close the gender gap between men and women, and 14 years, educationally. It would also take Africa 140 years to achieve gender parity.

Typically, women have the shorter end of the world’s growth, innovations,

development, and recognition. And like the economic and education sector, women are majorly at the lower rung of every sector. In South Africa, for instance, three million people lost their jobs as a result of the Covid-19 pandemic and subsequent lockdown. Of these 3 million job losses, 2 million were women.

Writing about Anna, Fuller Project says that “The women who work in these industries are very marginalized. They are dependent on their incomes and really vulnerable. And so nobody really bothers about them. These women are not just invisible, it’s like they don’t exist.”

The World Economic Forum’s Global Gender Gap report says that the world is now going backwards on its long road to gender equality.

In Global Supply Chains, Inequalities Are Rife

AMcKinsey study published in July estimated that around the world, women’s jobs are 1.8 times more likely to be cut in this recession than jobs held by men.

Anna’s story gives us a glimpse into the lives of low-income women in many African countries whose jobs are hanging by a thread. A slight “world setback” and poof, it’s gone. It is a tale of a world where women bite the bullet the most, economically, when epidemics, pandemics, or crises of any sort arise.

Like Anna, when the Ethiopian government moved toward industrialization in the last decade, tens of thousands of women made the journey to the factories of Hawassa, a large city in the country’s south where a sewing job was waiting for them - a rare chance at a formal job and a steady paycheck. In the Hawassa Industrial Park, 30,000 people were employed, the majority of whom were women. But as the pandemic

spread its tentacles into countries, garment orders were canceled, factory work slowed, and in a twinkle of an eye, thousands of these women were let go.

Morgan Hardy, assistant professor of economics at NYU-Abu Dhabi, explains that the Hawassa women are being affected in an indirect market way - one we might not have thought. A canceled prom in New Jersey can mean women in Hawassa don’t have enough to eat. “The women of Hawassa are kind of operating at the margins of the global value chain, they’re trying to eke out a better life,” Morgan says. But the more these women struggle for a better life, the more they are being treated disproportionately.

A recent research from the World Bank shows that while millions of men have lost jobs too, COVID-19 is having a disproportionate effect on women’s work. One factor responsible for this is that we have fewer women in leadership positions and the decision to retain or let go of the services of women in lower-income jobs are majorly made by men.

While it seems we now live in a world that is more conscious of gender representation and parity. More women are getting into the workforce, being recognised in their field of work, climbing the executive ladder, and attaining higher positions, more women seem to be plunged deeper into poverty, their names unknown and their works unaccounted for. And while every leadership level has seen an increase in representation through the years, the executive level has seen a decline in recent times.

For instance, the Gartner survey shows women comprising 41% of the supply chain workforce in 2021, up from 39% in 2020. In the same vein, women account for 15% of executive level roles in 2021, down from 17% in 2020. Reports from SCM World’s poll of global universities also show women accounting for 37% of students enrolled in university supply chain courses. Yet when you analyze Fortune 500 companies, only 5% of the top level supply chain positions are held by women. 56% of businesses also have fewer than one in five supply chain supervisor positions filled by females.

For WeForum, Philippe writes that millions of impoverished women are responsible for the collection of biomass energy, such as animal dung, agricultural waste and fuelwood, but these same women remain unaccounted for in big data.

For women in global supply chains, the statistics are bleak. Compared to men, women are working at the bottom of global supply chains. Christian, Evers and Barrientos (2013) write that “Women tend to be more concentrated in lowstatus work and men in higher-status jobs. In horticulture, women dominate in poorly paid/insecure casual work. In apparel, they make up the majority of lower-status assembly workers and seldom rise above supervisor level into management; the vast majority of line, production and senior managers are men.” A 2019 report from Global Partnership showed that not only are 70% of women excluded financially in Africa, the continent also has a US$42 billion financing gap between men and women.

On one hand, we probably can rejoice that we have more women joining the workforce, on the other hand, more women - across every sector - are being stunted, do not have an equal and level playing field with their male counterparts, and cannot attain higher levels. It is not enough to have women integrated into global supply chains, it is important to ensure that they are involved in top decision and policy making.

Building a womenat-the-top inclusive supply chain isn’t rocket science; most importantly is building a system where women are equal partners, with an equal share of opportunities, power and participation.

Getting Out of the Maze

As women sink deeper into poverty, they are forced to look for other means of survival. Anna, like many former garment workers in Lesotho, has since found a way to make ends meet: sex work. Now, it pays her roughly $6 to $19 per night. It is not enough, but it puts food on her family’s table.

Anna’s fortune could have been changed if she had There is only one way to get out of the gender maze in supply chains: give women a seat at the table.

Building a women-at-the-top inclusive supply chain isn’t rocket science; most importantly is building a system where women are equal partners, with an equal share of opportunities, power and participation. To start, businesses that are serious about empowering women in supply chains have to take stock of the specific risks and impacts on women in the company’s supply chains. Another is to increase the number of women in leadership, and amplify the work and power of those who are already at the top. One way to do this is to foster partnerships with women-led businesses to increase diversity in the supply chain and facilitate better economic opportunities for female entrepreneurs.

It is also important to ensure regulated incomes for women, and close the gender pay gap across sectors across the world. This entails strengthening governance structures and capacities in the deeper supply chain, especially where women are exposed to specific risks and where businesses have the potential to achieve positive changes for women while improving their own security and quality of supply. These measures can be designed to improve women’s economic situation or quality of life. Or they can be aimed at addressing a specific risk faced by female workers or women in local communities – for example, improving preventative measures and complaints procedures relating to sexual discrimination.

Getting out of the gender maze in the African supply chain also means questioning and challenging cultural nuances and belief systems that hinder women from getting to the peak of the value chain. For instance, in some African cultures, women do not have the right to own lands, even though statistics show that women produce 60-80 percent of the world’s food production. If gender dynamics shaping the value chain are taken into account, achieving gender equity in value-chain development won’t present difficulties. Truth is that we cannot have rapid and intense change without women. More than ever before, it’s time to put women at the top of supply chains.

Sara Beysolow Nyanti, Resident Coordinator, Nepal, United Nations, at the Reykjavík Global Forum says “there’s no ground zero without women; ground zero represents a place of rapid and intense change, and we can no longer have it without women.”

Next Wave Innovation Drivers in Africa

Innovation is critical for African nations to keep up with international trade, create jobs for the growing youth population, and expand their GDP.

Africa is the next frontier for innovations and business opportunities. The continent has a rising population and a growing rate of both mobile and smartphone adoption, which are indicative of opportunities for economic growth driven by innovation, especially comparative to Europe, America, and some parts of Asia where growth has plateaued. This also creates the opportunity to move beyond exploitation and exportation of natural resources, which have driven conflict in various parts of the continent, to innovations to catalyze significant growth across various economic sectors.

Innovation is critical for African nations to keep up with international trade, create jobs for the growing youth population, and expand their GDP. For example, Kenya experienced a decade of steady growth from 2010 to 2019, with GDP expanding year on year by an average of five percent, and a broadly stable macroeconomic environment reflected in low inflation, which is highly connected to the churn of innovative startup ventures catalyzed by increased mobile access (from one percent in 2002 to 39 percent in 2014). The Kenyan economy, according to the World Bank analysis, showed resilience to the COVID-19 shock, with 2021 output rising above the pre-pandemic levels.

The following factors are driving innovation in Africa, and policymakers, entrepreneurs and investors will do well to capitalize on them.

Key Innovation Drivers in Africa

1. Green Economy

The extractive industries, which include mining and oil and gas production, are the main sources of investment and revenue in many African countries. There is a global move for a switch to cleaner energy, and demand is growing for

cleaner energy technologies. Traditional oil and gas companies are rebranding as energy companies to accommodate. African countries are sources of a critical proportion of critical minerals for renewable energy technologies, for example, the Democratic Republic of the Congo (DRC) produces more than half of the world’s supply of cobalt, which is a component of lithium-ion batteries that power electric vehicles and store energy from renewable sources. Copper, one of the highest thermal and electrical conductors, is used five times more in renewable energy systems than in traditional power generation on the average. Solar photovoltaics (PV) rely on copper for cabling, wiring and heat exchange. The DRC is the top producer of copper in Africa, and the fourth largest copper producer globally; Zambia is Africa’s second biggest copper producer, and the world’s seventh largest. The global concerns about environmental degradation, health and safety hazards, and poverty and inequality caused by mineral extractions, and these make the case for African countries to move beyond extraction to value addition, especially in the renewable energy sector, for example, the manufacture of batteries for local, regional, and global markets. This is a way to embrace sustainable development, while expanding economic growth.

2. Urbanization

According to the UN, by 2050, nearly seven of ten people in the world will live in cities, and Africa is projected to have the fastest urbanization rate and be home to additional 950 million people. Urbanization is a catalyst for productivity and innovation because of the demands for housing, transport systems and other infrastructure.

According to the Center for Strategic and International Studies, it is rare to transition from a low-income country to a

middle-income country without first having to go through a process of urbanization. Hence, urbanization is critical for economic growth. Yet, urbanization without improved infrastructure and services causes negative repercussions. They overburden existing infrastructure, create more slums, increase poverty rate, and even when the unemployed or underemployed population turn to illicit or informal jobs, countries cannot achieve significant economic growth from them, since they are unable to collect taxes and reinvest them for further development. This is driving countries to make policy decisions supportive of innovation to stimulate job creation and infrastructure development for the expanding urban population.

3. Internet Penetration

Over the past decade, internet penetration on the continent has increased to ten times what it was in the early 2000s. Internet penetration solves access-to-information problems, makes transactions faster, cheaper, and more convenient, which increases productivity. Internet penetration has also increased inclusion, with more women and people with disabilities entering the formal workforce because they can now engage in remote work. It has expanded the talent market too, as skilled workers in African countries can trade their services in global markets. Overall, this has increased entrepreneurship in areas like mobile banking, e-commerce, and other technology solutions. The convergence of workforces has also removed limitations of collaboration and allows for experimentation of ideas. One example is in the area of education. Edtech is a rising star in Africa’s tech ecosystem because of the rise of the internet, and the solution to issues of access, quality, and affordability of education on the continent. Some examples of edtech innovations are Tuteria, which receives over 500 tutor applications monthly from students who need help in various subjects; uLesson, which

Conclusion

The most promising ideas have come out of markets and businesses, often driven by the necessity to solve a problem. The next decade will likely see a continued wave generated by better education and better access to information as people seek to increase their capabilities, while at the same time realizing the economic opportunities that exist through delivering innovation to others.

Universities are beginning to change their curriculum to include entrepreneurship and industries are actively seeking people with knowledge of how business models work to be successful in the highly competitive markets that exist in Africa today.

provides online lessons in various subjects and has had over two million downloads of its app; and Edves, a cloud-based school management software platform, among others.