Angola, Africa’s highest growth potential for luxury
According to the latest report from the African Development Bank (AfDB) Group, Africa is now the world’s fastest growing continent and is set to grow at more than 5.5% per annum for the foreseeable future. Almost half the African countries have achieved middle-income status and poverty levels have fallen from 51% in 2005 to 39% last year, with some 350 million African now earning between USD 2 to USD 20 per day.
More than two-thirds of African countries have improved their quality of governance, leading to a better business climate, improved basic services and expanded economic opportunities, Kaberuka said. By 2035, the African labor force will be larger than that of China and India, highlighting its rise as one of the most promising economic growth stories over the next few decades.
According to HSBC, China is the biggest player in this form of financing – under the banner of economic cooperation. Countries like Angola accounted for 6.1% of Chinese funds in 2011, Algeria 3.9%, Nigeria 3.3% and Sudan 2.6%, HSBC data shows. “In what has come to be known as the ‘Angola model’ China invests in major infrastructure deals in other emerging markets in exchange for a guaranteed commodity supply,” according to HSBC’. The funding is provided by Chinese banks (especially by China Export-Import Bank).
Last month, Italian luxury powerhouse announced plans to open a directly operated store in Luanda, capital of Angola in 2014. Ermenegildo Zegna and Hugo Boss are also considering opening in Luanda, within the same luxury shopping gallery, currently under development.
The best developed luxury sector in Angola is cars – Porsche opened a showroom in Luanda 2011, while BMW, Jaguar and Mercedes Benz opened in Luanda in 2010. Mercedes Benz announced in 2010 plans invest US$200 million in construction of a factory in the Angolan capital, Luanda. In 2011, according to local media, Mercedes Benz was the leader in luxury car sales in Angola, with 480 vehicles sold. The Porsche dealer in Angola confirmed in a report by the BBC that it sold 35 units in 2012 and it planned to increase its quota to 87 units in 2013.
CPP Luxury Industry Management Consultants Ltd has been covering Angola and Luanda since 2012.