At the Kofi Annan International Peacekeeping Training Centre, several African and Spanish experts gathered from Madrid. The economic recession has hit all parts of the world, but the African market is still appealing to many Spanish firms. They debated about security in the Sahel. The goal was to highlight Spain’s contribution to peace in West Africa. In October 2020, the minister of foreign affairs in Spain, Arancha Gonzalez Laya, returned from a tour of Niger and Chad as the general assembly president of the Sahel Alliance.
Spain has been a member of the Sahel Alliance since January 2018. Since then, it has been involved in 91 projects; a total of $147 million has been set aside for these.
The Third Plan for Africa
Since the Africa III plan was adopted in March 2019, the Spanish government has been interested in partnering with African firms. This third plan for Africa is much more ambitious than the previous two plans. It is built around four objectives: Peace and security, consolidation of institutions and regulation of migration, and economic growth.
This is due to several factors. One of them is the fact that there is still hardly any political turmoil in Africa. Another is that many African countries are very stable and continue to be important players in global trade.
The economy in Africa is growing at a rapid pace. The continent accounts for more than half of the world’s Gross Domestic Product growth. The high rate of technological advancement in Africa also plays a major role in contributing to the African market’s robust economic growth. These factors make the African market a sought-after destination for many Spanish companies. So much so that there are growing calls for more investment in the continent.
This is possible because Africa offers a wide range of markets for Spanish firms. It is a land of rich diversity with millions of potential customers. The continent has become an increasingly important trading partner for European and American businesses.
Political Stability
A further factor that makes the African market such an attractive one for Spanish firms is the country’s relatively stable political scenario. Different parties have ruled Morocco and Algeria since different times. The last major war was fought over Algeria and Morocco. Both these states are now allied with France, so there is no likelihood of any military confrontation. Political stability is an additional attraction for investors in Africa.
The African market still has considerable potential as an outsourcing market. This is particularly true in IT services, where the economies of many countries in sub-Saharan Africa are becoming more efficient. Many Spanish firms are established in areas like finance, hospitality, and tourism in Africa.
Besides, Spanish firms can make use of the country’s natural assets to create value. For example, mining and oil exploration remain major economic activities there. The country also has the world’s largest diamond deposits. There are also abundant supplies of gold and oil in several African countries. The infrastructure of many African cities is developing rapidly, which offers a ready market for modern technology.
The need for Spanish workers is high in Africa. Many Spanish nationals or expatriates work in the construction sector in Africa. In recent years, the number of Africans working in Spain has been on the rise. The same trend is expected to continue. This means that there is likely to be a growing need for more jobs in the Spanish market.
The political and economic situation in Africa offers plenty of scope for expanding Spanish business. The growing economy in sub-Saharan Africa offers ample opportunities. Africa’s new governments are showing an interest in facilitating trade. This has made bilateral trade easier between African countries. As trade continues to expand, both Spanish and African firms can enjoy the benefits of economic growth.
Growth Potential
Growth of the African market will also generate job opportunities for Africans. It is estimated that there will be around twenty million African job seekers in the coming years. More job opportunities in Africa will facilitate the expansion of the Spanish market. Many leading firms in Africa have found major business opportunities in sub-Saharan Africa. Lufthansa Airlines, Continental Airlines, CitiBank, hedge fund manager W.A.S.C, and Banco Spanish are some of the major players in this market.
The growth of the Spanish market is also facilitated by political stability in the country. The economy’s stability and growth rate have made it one of the few African nations with a higher per capita income. Inflation and high unemployment rates in Spain have not deterred companies from taking advantage of the African market. Many leading African firms have expanded their operations in Spain.
Facilitated Entry
The country’s political situation has also played a major role in encouraging the growth of the Spanish market. The new governments in different states of the country have brought about some economic liberalization measures. The central government in Spain has eased some of the fiscal policy restrictions imposed on local firms. This has facilitated the entry of smaller and foreign firms into the country’s market. The state-owned banks are also helping the market by offering low-interest loans and easy credit lines.
The overall economic situation of the Spanish market is still positive and is expected to grow further. Africa is a rapidly growing market that will continue to provide new business opportunities to Spanish firms. Companies in Africa can benefit from the expansion of the Spanish market. The growing Spanish market will stimulate the economy and make it more attainable for African countries to attract large-scale investment and foreign exchange.
