THERESA ONAJI-BENSON: Is Africa really open for business?

After being denied a visa to attend a conference in Egypt, I had a conversation about the issue with a British academic and Fulbright professor at Strathmore University in Kenya. I shared my frustration, as a Nigerian living and working in South Africa, at being stonewalled by a fellow African nation.

“That’s ironic,” she exclaimed. “I am a dual US citizen. I can travel almost freely around the continent.”

That’s worse than ironic, I thought — it’s unnecessary and bad for African economies as a collective.

That short discussion got me thinking. You don’t have to be an expert on the topic to hear the slogan, “Africa is open for business.” It is emblazoned on T-shirts and we hear it on radio adverts.

It could be interpreted as Africa being open to other continents. That’s an important issue; we can benefit hugely from this (as long as the openness is healthy). But I wonder how open we are to one another, intra-continentally. There is evidence that there is more low-hanging fruit on this metric than the global connectedness one.

The political intention and treaty structure for the gains of intra-African connectedness seem to be largely in place. The African Continental Free Trade Agreement makes it official. But there is a long way between signed documents and border posts. This treaty is struggling, like so many before it, to get out of the starting blocks.

The spark for the treaty seems to have come from a 2016 publication by the African Development Bank that found — in line with my recent conversation — that it is easier for North Americans to travel in Africa than it is for Africans to travel in Africa. The treaty came into effect about five years later, in January 2021, when the first batch of goods under the preferential agreement were shipped from Ghana to South Africa.

Still, by early 2023, the goal of reducing 90% of trade tariffs on goods within five years for developed countries, and 10 years for less-developed ones, seems a long way off.

My musing took me to work done by my colleague, Prof Adrian Saville, founding director at the Centre for African Management & Markets. For several years he produced the Visa Africa integration index. Armed with a treasure trove of big data from the global financial services company, Saville analysed, among other things, ways in which people spend money across borders, and where people spend money.

Based on transaction information, how connected are African countries really? How are they connected, and what are the implications of being connected or — more likely the case — disconnected?

The good news

Saville’s work is unique in that measures of connectedness tend to focus on trade flows and capital movements. The multiyear project with Visa provides granular detail on exactly where, for example, a Kenyan traveller swiped her credit card at a store in Cape Town’s V&A Waterfront.

The findings, pre-pandemic, were that Sub-Saharan Africa is one of the least connected regions in the world. In line with plenty of other research, the calculations showed a strong link between rising connectedness and improvements in economic and social wellbeing. Here, the leading light was Rwanda. Over five years of analysis it produced the largest gain in connectedness. The corresponding growth of income per person of 7% was not coincidental.  

But all of that felt quite theoretical, as I was still ticked off about the unwelcoming treatment from the Egyptian visa authorities. Trying not to take it personally — and to look for a silver lining — I searched for evidence that African countries are becoming more welcoming to African citizens. Thank goodness, they are.

The latest report from the African Development Bank shows that, despite Covid lockdowns and travel disruptions, 93% of African countries have maintained or improved their score relative to 2021. And two-thirds have adopted more liberal visa policies compared with six years ago.

There are even examples of countries that ask for nothing more than a valid Africa-based passport to gain entry: Benin, The Gambia and Seychelles. For travellers accustomed to the ease of electronic visas, there is more good news: nearly half of African countries now offer an e-visa.

Wearing my optimistic hat, this feels like a living example of that oft-quoted African proverb, “We are going far, together.” Not fast enough for my Egyptian trip, but there will be a next time.

* The Centre for African Management & Markets at the Gordon Institute of Business Science conducts academic and practitioner research and provides strategic insight on African markets. Onaji-Benson is a researcher with the centre