Are well-laid cables the key to developing Africa's infrastructure? International cable corporation Nexans seems to think so.
Their strong belief in the economic potential of African nations spurred their desire to hold a conference in Ghana to discuss the increasing possibilities the region provides for businesses.
Last week, the company invited 200 African professionals working in the infrastructures, industry or building markets to its third Cable Forum, held in Accra.
The event was designed for all African customers and prospects considering doing business in the area to catch a glimpse of the regional market opportunities, and see what Nexans has accomplished on the continent.
"In the medium term, the African continent may well become one of the most dynamic markets in the world,' said Wolfgang Bedorf, Executive Vice President of Middle East, Russia, Asia, and Africa area.
The company believes that the growth potential of the African market is greater than ever, and points to their numerous projects currently underway on the continent.
While the global financial crisis has been making business opportunities scarce in Europe, North America and Asia, Africa has been enjoying a period of sustained growth in the energy infrastructures market, as well as in the building and industry sectors.
Ghana in particular has been praised. The Doing Business 2009 report released by the World Bank ranked Ghana 87th out of 181 economies, the highest out of the ECOWAS member states and 6th among all African nations.
The country was particularly lauded on the ease of starting a new business after it eliminated the requirements to register employment vacancies and to obtain a company seal.
Nexans"s strategy in Africa is to consolidate the group's leading position in North and West Africa, where they own and operate a total of six production sites in Egypt, Morocco, Nigeria, and Ghana.
They hope to keep increasing profitably their market share, and to render Nexans's factories more competitive against other businesses in the region.
In Central, South and East Africa they expect to set up manufacturing facilities and trading operations, and accelerate the acquisitions' plan.
In Ghana, Nexans operates a production site out of Tema.
Incorporated in 1970, it now employs 105 workers, with sales approaching ten million euros annually. Major Nexans customers include the Electricity Corporation of Ghana, the Ministry of Energy, and Ghana Telecom.
The company is hopeful about their growth prospects in Africa, even when acknowledging the difficulty of conducting business on the continent.
In a press release, they state that they believe 'the financing of major projects has long been a problem for companies established in Africa. There are tremendous needs on the continent, but the proper conditions have not always existed for conducting large projects.
'Yet the situation is changing: the World Bank, the IMF, the African Bank and private investors from Asia, the USA and Arab countries are injecting billions of dollars to upgrade the continent's infrastructures, thereby creating a virtuous circle.
The key projects on the continent, which once represented obstacles to African development, have now become powerful growth opportunities, and even drivers of economic expansion.'
Nevertheless, business in Africa presents some unique challenges to which most companies are not blind. There is a strong demand on the continent for huge, complex projects which can be quite overwhelming to some businesses.
Companies are faced with long delivery times and frustrated by the slowness of the distribution chain. And they must deal with the copyright infringement and counterfeit products.
Nexans believes they have attained some solutions to these obstacles. The company has plans to establish regular seminars to sensitize local authorities to the importance of quality, so that they can ensure the safety of both people and equipment.
Using local suppliers and producers, dedicated sales and experts teams, and new storage models will help to avoid the issue of long delivery
Too, they propose to collaborate with local customs officials to fight against 'grey imports,' where goods are imported legally into the country but without the consent of the manufacturer.
It is the company's hope that their business plan will inspire other multinational corporations to invest their businesses in Africa.