“If you look at global trade, the fastest growing global trade is South-South trade. Earlier on it was between emerging markets and developed countries, or between developed countries themselves. Africa is a big beneficiary of what we’re talking about. Take Africa-China trade: last year, it was over 200 billion dollars. If you go back 12 years, it was eight billion dollars. This is phenomenal,” Viswanathan Shankar, group executive director & CEO of Europe, Middle East, Africa and Americas at Standard Chartered Bank, told CNBC Africa.
“Even the Indian trade has grown 10 times over the last 10 years. It is not just trade, it’s also investment coming in. It’s across sectors. It’s across petrochemicals, resources. You’ve seen agriculture investments in Ethiopia by Chinese companies, Indian companies coming into the mobile telephony space [such as] Bharti Airtel buying Zain, also Middle Eastern interest in ports . This is great.”
(READ MORE: China-Africa trade now 200 times more than in 1960)
Shankar added that Africa has the highest potential when compared to the Middle East and Europe, and the continent also happens to produce the highest growth rate for Standard Chartered Bank.
“Africa today is the fastest-growing region in the world save Asia, and if you exclude China from Asia, clearly Africa would be the fastest-growing continent. You’re also seeing financial deepening happening in Africa and it’s in very early stages,” Shankar explained.
“So if you went to project out 15 to 30 years, Africa is going to be the story. [If] you look at the working age population, by 2035 Africa will have more people of a working age than in either India or China.”
Shankar added that 60 per cent of the world’s uncultivated arable land is in Africa, highlighting the continent’s huge agriculture potential.
There is however an equally large requirement for infrastructure which, according to Shankar, amounts to 100 billion dollars needed per annum. Foreign direct investment in the continent is nevertheless growing across the board and continues to thrive.
“I think people are realising at the one side, yes, Africa is a collection of countries, it’s not a country. There is also a realisation that in order to have scale in Africa, you need to be at least regional if not pan-African. With the formation of regional alliances, there is a common market developing over a period of time. It’s still early stages.”