With last week’s signing of the Tripartite Free Trade Agreement, trade and business within Africa are set to change. However, Dubai’s role as a business hub for the continent is set to continue undiminished say a number of analysts. The UAE’s geographic location and skilled workforce have led to it becoming a logistical and supply centre like no other when it comes to African industry and trade and, despite the change in the air, Dubai’s strong links with the continent will adapt and continue.
Perhaps the clearest example of Dubai’s’ enduring role can be found in the realm of Fast Moving Consumer Goods (FMCGs). Africa’s decaying infrastructure and underdeveloped supply chains have led to vast wastage as foods and other degradable products have rotted before reaching market and it is often cheaper to ship the unprocessed food to the UAE before sending it back to Africa in the shape of the finished product. Despite the recent problems experienced by large multinationals such as Nestle, Coca Cola and Cadbury, the belief is that Africa’s middle class is increasing in size and the demand for processed, convenient foodstuffs will grow.
In addition to trade and manufacturing, the Gulf’s airline industry is targeting Africa, with Emirates, flydubai and Etihad expanding at an impressive rate over the last few years. Africa itself has become a focus for Etihad in particular, and the airline planning to increase its operations on the continent by over 40 percent.
Dubai’s position as a business hub for Africa will, there is no doubt come under threat in the future. However, at present the UAE’s comparatively advanced infrastructure and skilled workforce have placed it in a prime position to service some of the fasting growing economies in the world. This infrastructure makes it the perfect place for businesses looking to work in Africa to base themselves as well as African businesses, like the aforementioned FMCG industry, taking advantage of Dubai’s beneficial environment. The Free Trade agreements might well prove a game changer in the long run, but for now, the UAE appears to be in pole position.