Development Reimagined helping put trade at the heart of sustainable development in Africa
At Development Reimagined we firmly believe that ‘aid’ or development cooperation is not the only answer to sustainable development in Africa. Solving economic and social problems in poor and middle-income countries requires structural change –in trade, investment, people. We believe in a holistic approach – looking at all areas of development, beyond aid, and what role ALL actors can play – not just governments, and not just one part of the world.
China is a key player in this and since 2008 has become the Africa continent’s largest trade partner. And for the 53 African countries with diplomatic relations with China, there has been heavy investment in infrastructure and development, and undeniably this has contributed to Africa’s economic development and enhanced some of the Sustainable Development Goals (SDGs). However, there has been a stark imbalance in the trade composition between China and 40 of these African countries. This stark trade imbalance severely affects the capacity of African countries to create jobs, earn foreign exchange, and develop sustainably to cut poverty – calling for building a more sustainable Africa-China relationship that alleviates the acute trade imbalance.
This is why at Development Reimagined we designed our first ever Bespoke China Market Entry Programme,called “Africa Reimagined” and invited 7 exciting, innovative and sustainable Africa brands to China. From jewellery, to fashion, to tea and skincare, we brought together these SMEs to disrupt the stereotype of Africa products and help their ambitious CEOs understand how to enter the vibrant and ever-growing Chinese consumer market.
At After 10 days, 3 cities (Beijing, Changsha and Dalian), 1 trade expo (China- Africa Economic Trade Expo) and 1 international conference (World Economic Forum- Annual Meeting of New Champions), these are the four key discoveries we made…
- Chinese consumers DO have an appetite for luxury African products, clearly demonstrating that China-Africa trade has the potential to go beyond raw materials and agriculture!
Over the duration of the expo more than 90% of the products were sold out at the expo, and multiple inquiries were made about further distribution channels.Many customers bought multiple items and had a genuine interest in understanding more about the history of the product and the brand. Our experience has demonstrated that high-end, luxury African products do have a place in the competitive Chinese consumer market and CAN take a slice of the estimated $5.6 trillion projected sales in China (2019)- around $100BN more than the United States.
- Many African businesses are not aware of the opportunities the Chinese market provides for African companies yet at the same time these businesses urgently need strategic support to navigate and enter the complex Chinese market. Currently, no online or offline platforms exist that promote high-end luxury African goods and products in China.
Whilst designing and implementing the programme, we were in touch with over 50 African brands in multiple sectors. Through this it became clear that most African businesses are not aware of the vast opportunities the Chinese market can provide for growing their businesses. Most African SME’s are looking to the USA, where consumption is rising by 2% year on year, yet in China it’s increasing 16% per year.
Moreover, it is clear that African businesses are significantly unprepared and resource-poor to enter the Chinese market. If in China, most are operating informally or in joint ventures that provide for poor intellectual property protections. They do not understand the Chinese market trends (let alone language) and opportunities nor the official requirements. The Chinese market is vast, opaque and regulated heavily, thus many foreign companies rely on trade facilitation organizations to navigate doing business in China.
- The way African products are marketed is outdated and does not reflect the number of high-end, quality and innovative products on the continent. Perceptions need to change!
There is a severe lack of awareness in China about Africa. Ask any ordinary Chinese person which African countries they have heard about, most will reply Kenya – for animals; Nigeria – for oil and its large population; South Africa – for extractives and mining; and Ethiopia – as a new manufacturing destination for simple apparel. This needs to change and during our 10-day programme we worked alongside many media outlets from CGTN to The Global Times to shift the narrative and educate the public about the innovative side of Africa.
- It IS possible to create tangible impacts for local communities in Africa by utilising the Chinese consumer market, to grow SMEs and create more jobs and ultimately more poverty reduction.
The brands we brought together all create jobs and skills and reduce poverty reduction back in Africa. Together the companies directly employ hundreds of people and indirectly employ thousands in their local communities. If when entering the Chinese market these companies double their workforce that would mean many many more local people learning new skills. Imagine if this is scaled up to more countries and companies, all who keep their supply chain in Africa, all who directly reduce poverty and all who change the way people perceive Africa…
So – what next?
First of all it is important to recognise that this was a pilot.
The “Africa Reimagined” programme we designed – supported by our partners – consisted of 3 key pillars, each designed to create partnerships, build knowledge and grow awareness for the companies.
First, through an innovative and interactive Africa Reimagined exhibition, the brands we attracted to China were able to showcase their products and business models to thousands of Chinese and international visitors over the course of two days. Many of them received overwhelming interests from Chinese customers and manufacturers, distributors and perspective trade partners.
Second, the delegation experienced the opportunities and challenges of China’s market potential first-hand, our partners discussed and presented new policies, infrastructure, and ecommerce platforms that encourages trade between Africa and China.
Lastly, they had the opportunity to meet successful China-based entrepreneurs and international renowned businesses, as well as leaders in innovation, technology and science through British Chamber of Commerce in Beijing and World Economic Forum’s Annual Meeting of New Champions in Dalian, China, where they received valuable advice on how to “scale up” to the next level and be ready for a globalized market.
What will the brands who participated do next?
The 7 African brands on this first pilot sit within various sectors such as lifestyle, fashion, jewelry, and skincare, and came from a broad range of African countries – Nigeria, Tanzania, Ethiopia, Zimbabwe, South Africa, Ghana, and Rwanda. All the brands have a strong sustainability component to their business models, with commitments to cutting poverty and promoting ethical business practices through their supply chains. The brands range from a luxury jewelry company that just opened the first women-only mine in Zimbabwe, a fashion company and a skincare company that respectively employs marginalized artisanal women, as well as a tea company from Nigeria that is bringing Africa’s superfood drink “Moringa” to China.
These brands were all impressed by the response in China. Some are looking at concrete next steps to enter China, including brand trademarking, e-commerce platforms, distribution partnerships – and some are already shifting their marketing budgets towards China. If you are interested in knowing more about them and supporting their further steps do contact us!
Will there be another Africa Reimagined Space and another China-Africa Economic and Trade Expo?
The China- Africa Economic and Trade Expo was one of the first concrete deliverables under the 7th FOCAC meeting held in September 2018. It will be held biannually going forwards, and Africa Reimagined will definitely be there again next time! However, this is not the only relevant expo for our 7 brands nor other brands that want to enter China. We are currently considering with our partners future opportunities, and are open to welcoming new brands and suggestions, especially in 2020 for new partnerships in this area, to continue disrupting stereotypes about Africa and disrupt how China and other countries invest in African countries.
At Development Reimagined we will continue to work with all partners – both governments, and the private sector– to provide practical support and advice, and create a unique platform to help African business enter the Chinese market and ultimately help deliver sustainable development and poverty reduction in Africa and beyond.
Will there be another China Market Entry Programme?
Our aim with this pilot was to experiment with showcasing innovative, cutting-edge African businesses that are creating high-quality, luxury consumer products using an entirely African-based supply chain, from agricultural & raw material inputs all the way to the value-added finished items. The products showcased demonstrated the broad range of African talent and expertise as well as provided inspiration for how companies from all around the world can invest in Africa in a way that creates more jobs and helps people – especially women – escape poverty and achieve sustainable development, just like China has.
We are very grateful to our partners for this pilot – the China Africa Business Council, the British Chamber of Commerce, the World Economic Forum, Ethiopian Airlines, Trouve, as well as the Hunan Province Department of Commerce – who worked tirelessly with us to make it a reality and success – which it was.
Based on the success of this pilot, we therefore believe there is room for further programmes as well as scaling up – so stay tuned for more updates on this website as well as our twitter (@devreimagined) and linked-in accounts!
If you are interested in collaborating with us on our next steps or with our brands, please get in touch with us at africaexpo@developmentreimagined.com.
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Africa Reimagined is a China Market Entry Bespoke Program designed and spearheaded by Development Reimagined. Seven sustainable African brands from all over the continent participated in the pilot, held from June 25 to July 3, 2019.
July 2019
