Nigerian business man Aliko Dangote has urged African executives to take advantage of the 2015 down turn and invest to reap big from the expected recovery.
Mr Dangote who is planning to set up a cement and dairy manufacturing plants in Kenya, told the African CEO Forum that companies investing at the moment will pay far much less to enter into African markets and reap big when the economies picks up.
“This are good times to invest because things are down everywhere and there are massive discounts so you will invest much less but reap big when the economy picks up,” he said.
Morocco Minister for Industry and Trade Moulay Elalamy said Africa is also set to benefit from the shift of the Chinese economy from manufacturing to services and consumption.
“The minimum wage in China has risen from $5000 to $700, this makes labour in Africa cheaper and it is estimated that 85 million jobs will leave China and Africa could be the one that benefits,” he said.
In an effort to become a textile and apparel sourcing powerhouse for the African Growth and Opportunity Act (AGOA) market, the Kenyan government is stepping up Industrial parks where it plans to give Export-Processing-Zones-tax-incentives as well as reduced energy rates, to encourage manufactures relocate to the country.
Export firms will pay US cents 9/kwH, against the industry average of US cents 14/kwH, with a promise that the rate will be cut further to US cents 7/kwH in two years.
The companies may only require one licence from the county and national governments.
Other incentives include 10-year tax rebates and a 20-year period to amortise capital investments.
They will also be allowed to employ more than 2 per cent expatriates. The ministry will help these employees get work permits.
The firms will also access local markets through a window to sell 20 per cent of what they export without paying duties.