Destination Guide

Africa - Fingers Crossed

Africa is a challenging place to do business, but Jonathan Hart finds many positives in a continent rich with opportunity

Hope springs eternal and it's not only South Africa pinning future expectations on Jacob Zuma's inaugural promises of renewal and reconciliation.

The rest of Africa, as well as a watchful outside business world, is also keeping fingers crossed that sentiments expressed by the new president of the region's most powerful economy will help to ease the detrimental images of a market immersed in incessant political squabbling, corruption and social strife - images that collectively have served to impede or overshadow much of the continent's progress on a global stage.

Forgiven his own alleged misdemeanours en route to power, former goat-herder Zuma is widely viewed as advocating the inclusive policies, fundamental reforms and pragmatism that overall could help to narrow divisions and promote cross-border harmony, instil longer-term confidence and encourage more foreign direct investment, too.

Not least because despite its volatility, civil wars and humanitarian disasters, has generally proved resilient to the ravages of the global financial crisis. Rich in natural resources and high risk or not, the continent continues, for the most part, to show solid growth or potential while much of the rest of the world festers in the economic doldrums.

Among other global bodies, both the UN trade agency (UNCTAD) and us-based Overseas Private Investment Corporation (OPIC) currently reckon this continent of 900 million people offers the highest return on direct foreign investment in the world. as China, an avid investor in has long known.

North African countries, bar one lame duck, no longer play second fiddle to their Mediterranean neighbours in trade, commercial acumen or independent aspiration. Also, beyond the disturbing headlines in sub-Saharan sustained political stability allied to business reforms and private public partnerships in many areas have prompted fresh aid plus a slew of new development projects.

The region's three strongest economies may all have felt the knock-on effects of the crisis to some degree, as well as having serious domestic problems to surmount, yet all show upward growth this year.

South Africa retains a pivotal role with its broad-based economy incorporating agriculture, mining, manufacturing and service industries, together with its established infrastructure and emergence as a major international events host, including this year's IPL cricket and next year's FIFA World Cup. Second place Nigeria and, notably, fast-rising Angola are, meanwhile, viewed as increasingly prominent global players in oil and gas.

At the same time, sustained political stability in other countries has earmarked them for investment. Benin, for example, has doubled its foreign trade in recent years and Ghana has just won US$3.2 billion in project aid from the World Bank/IMF.

Apart from North Africa, with its proximity to Europe and links with international partners on many levels, the continent remains largely the preserve of big multinationals or NGOs venturing where smaller organisations fear to tread.

Among these, big challenges still face those entering or expanding the market due to its diversity and disparate nature, according to Kathy Harris, managing director of Johannesburg-based travel group HRG Rennies Travel, global alliance partner with international corporate travel services organisation HRG (Hogg Robinson group).

Together with mitigating the high risk factor associated with successful market penetration, these include the type of business travel facilitation employees might take for granted elsewhere in the world but is not yet in place everywhere across the region.

"Local on-the-ground assistance and expertise is essential in every respect," says Harris. "Having an intimate knowledge of the region is essential. It's important to understand exactly what the political and socio-economic situation is in each country in order to appreciate what some of the opportunities as well as the dangers and challenges are."

Harris says that while it's vital that companies are equipped with good emergency and evacuation solutions there are other hurdles to be overcome, including general flight access, costs and communications "While the risk factor can come top of the drawback list from a personal safety standpoint, the biggest current bugbear from a general travel viewpoint is that carriers are providing limited frequencies into and out of Africa," she says. Virgin Nigeria and air Namibia were among carriers suspending their UK flights recently.

"It can be very frustrating," adds Harris. "Overseas travellers may only want to go for one meeting in one particular country, for example, but that can mean being away from home or office for four or five days because of the lack of connections. We tend to find that where there is a national carrier that's where a lot of the challenges exist in frequencies and rights. That, in turn, means consistent lobbying at a local level to improve frequencies or, if there's sufficient client volume, finding alternatives such as charters."

The lack of frequencies and competition, both in the air and on the ground, means that Africa can be an expensive business travel proposition, says Harris - an expense exacerbated by the fact that in many cases fares and rates are based in us dollars which can have a negative exchange impact on those dealing in certain currencies.

Communications are another major drawback due to a general lack of internet and web-based facilities across the region.

"From a technology point of view, one of the greatest challenges is that many countries simply don't have the kind of bandwidth capability for the deployment of certain business travel products and services," says Harris.

"That said, if you compare what it is like travelling in today with, say, five years ago, there's a lot more information, comfort and knowledge around together with a lot of opportunity, specifically for oil, telecommunication and technology companies.

"The continent generally has witnessed no significant deterioration in demand as a result of the global financial crisis compared to the down-trading that's taken place into and out of Europe, North America and Far East."

She says multinationals with established bases in south have now started to set up secondary bases elsewhere in Africa. and while is likely to remain the business travel driver, what will probably happen in the next 10 years or so is that some of those companies will also transfer their primary operations elsewhere as it becomes easier to travel from country to country.

"It all looks very positive," adds Harris. "Bearing in mind that I'm the eternal optimist."

TMCs in Africa

Both HRG and Carlson Wagonlit travel (CWT) have built large pan-African networks, each numbering up to 30 or more partner companies across the continent.

The HRG network affords much more than occasional co-operation between partner companies, says Kathy Harris. "there is consistent inter-action between partners and the size of the network is positive in that we can very often provide an integrated solution for multinationals in a multiple of countries across the region. We also share a system of dedicated business managers delivering set criteria for multinational clients."

As the HRG's strategic partner for Africa, HRG Rennies sits on the global board and is party to strategic decisions and considerations in terms of how the business travel market is evolving both globally and regionally, she says.

"We do a lot work with HRG in terms of providing products and services for the environment and where we do have challenges, then we work with the local partner to address and try to overcome them." Partners have regular quarterly meetings, or sometimes more than that, in different parts of the continent.

Harris continues: "One of our key strengths is that we operate a very democratic approach to the way in which we engage with all of our partner colleagues. Different countries offer different levels of strength and different levels of sophistication, so we are heavily involved in training up where it is needed. the key, though, is having the right local connection. For example, you may have a partner in one country that is not particularly sophisticated but who is extremely effective in fulfilling a specific need. I would honestly prefer to have that than have a highly sophisticated business travel solution in an environment which didn't have that connection. We all know what our strengths and weaknesses are and, collectively, we play to the strengths."

It is essential to have a network that is both extensive and reliable, and with proven experience, echoes Coenraad Bijlsma, vice president, global partners network for CWT.

"Listening to our clients, especially those in the energy, telecom and NGO sectors, we believe there are opportunities for consolidation of corporate travel programmes across the continent. CWT will be increasing its efforts over the next few years in human resources, security systems, technology and training to give corporate clients a seamless and consistent experience in Africa as well as to drive down the cost of travel."

Alleviating risks

Updating or refining risk and crisis management tools go hand in hand for business travel providers to - with employee tracking and safety among key considerations.

For example, the latest version of HRG Watch for travel managers, launched at this year's Business show, combines integrated alerts and hotspot reports with interactive maps and data that can be drilled down to track individual travellers.

The alerts highlight potential disruptions to travel and support client crisis management programmes. hotspot reports identify locations considered a security or medical risk.

Compliance and control remain priorities through policy tracking and early alerts to potential non-compliance. tool is designed to work across multiple GDSs and enables management of data from both online and offline channels, whether the source is HRG or other TMCs.

Airlines to Africa

South Airways, British Airways and Virgin fly from London Heathrow to Johannesburg and Cape town. SAA provides additional links from the UK to Botswana, Mozambique, Niger, Lesotho and Zambia. BA also flies to Zambia and Uganda. together with Ethiopian Airlines and Kenya from Heathrow, BA flies to Ethiopia and Kenya and, alongside Lufthansa/bmi, to Tanzania and Sudan. Arik Air flies daily from Heathrow to Lagos and BA serves Abuja in Nigeria. Ghana International from Gatwick and BA from Heathrow serve Accra. Iberia, TAP, Brussels and France link the with Senegal. France and/or KLM also provide flight connections from primary points to Benin, Burkina Faso, Burundi, Cameroon, Central Republic, Chad, Congo, Djibouti, Gabon, Ivory Coast, Kenya, Madagascar, Malawi, Mali, Rwanda, Tanzania, Togo and Uganda. These flights are supplemented from by Afriqiyah to Cotonou; Royal Maroc to Ouagadougou; Brussels and Ethiopian to Bujumbura; Brussels and Swiss to Douala; TAAG Angola to Bangui; Ethiopian to Ndjamena; RAM and Ethiopian to Brazzaville; Ethiopian and Kenya to Djibouti; and Ethiopian to Libreville; Brussels (also from Leeds Bradford) to Abidjan; and Thai to Antananarivo; and Ethiopian to Lilongwe; RAM to Bamako; Brussels and Ethiopian to Kigale and Ethiopian to Lomé. Ethiopian has established a new Togo-based carrier, ASKY, flying East-West routes.