West Africa: A land of opportunity for Australian exporters beyond Mining
Looking Beyond Mining: A land of opportunity for Australian exporters in West Africa
Social development goals to pave the way for greater agricultural exporting
Written by Emma Bendall
West Africa is proving to be a key emerging export market destination for Australian commodities. Looking beyond well-established mining trade relations, the region is set to emerge from COVID-19 as a leading commercial hub on the wider continent.
Whilst South Africa has enjoyed the lion’s share of attention when it comes to business and trade relations, Ghana, Côte d’Ivoire, Nigeria and Liberia are experiencing double-digit growth as they develop and emerge as stronger economies.
Why West Africa?
West Africa isn’t entirely unfamiliar for Australian exporters. Indeed, Ghana, Côte d’Ivoire and Burkina Faso have mature relations with Australian mining companies and METS exporters, thanks in large part to the immense gold and mineral resources in the region. Yet, Australian exporters should to consider more closely the national interest of each country, and to capitalise upon exports that are symbiotic with government objectives. For many of these countries, that means supplementing human development goals set by respective governments and supporting the growth of an expanding middle class who expect a higher quality of life. Taking into consideration local conditions and social trends may go a long way to fostering new trade relationships.
As it stands, Australia has the biggest trade relationship with naturally the biggest economy in the region, Nigeria. Between 2017 and 2019, Nigeria received US$601k worth of goods from Australia, namely wheat, machinery and vehicles. The nature of exports to its neighbours however was much more monotonous. Mining-related equipment dominated exports to Burkina Faso, Mali, Ghana and Côte d’Ivoire. This is despite the fact that nearly every West African country relies on imports of basic foodstuffs.
With China throwing Australian trade prospects into shaky territory, the expansion of avenues of Australian exports – meat, wine and grain – into new territories may prove to be a viable strategy in regaining lost ground. Ghana is an excellent case in point. The nation does not grow its own wheat, yet its burgeoning middle class and changing lifestyle behaviours has meant that Western style bread and convenience products are increasing in demand. A similar trend is observed in meat consumption, where chicken is increasingly becoming the preferred source of protein – yet domestic chicken production is dwarfed by demand. Although supply is dominated by Canada, Russia and the USA, Australia may be able to leverage wheat exports to neighbouring Nigeria to get a stronger foothold in the region.
Taking into consideration local conditions and social trends may go a long way to fostering new trade relationships, and Australian agricultural exporters stand to reap the benefits.