GE in Africa: African Business
Years of building a business across Africa that prioritised localisation stood GE in good stead when the Covid-19 pandemic hit the continent, says President and CEO of GE Africa, Farid Fezoua.
The US multinational company that has had a presence in Africa for more than 120 years, has accelerated its localisation strategy over time, building local capacity across its staff, leadership, structures and services.
This enabled the company to deliver uninterrupted support to clients throughout the lockdowns imposed across the continent to prevent the spread of infection.
“With borders closed and being unable to fly people from other parts of the world into Africa, if we had not had the localisation capability to fall back on, we would not have been able to serve our customers at a time of critical need,” he says.
Fezoua, formerly the head of GE Healthcare, says the past year has been challenging but it has brought to the fore key learnings that have enabled the company to maintain critical service and maintenance functions and deliver services digitally in a closed down space. “Unfortunately, you often need a crisis to make progress and accelerate.”
The importance of localisation has been one such learning. Being fully equipped and capacitated on the ground at such a time was critical to maintain customer service.
Another has been the acceleration of digitisation. “We have really seen the blossoming of digital. The pandemic gave us an opportunity to see digitisation at play in a space where safety and operational protocols were needed. The GE teams were able to digitally access critical parts of systems in power plants and medical facilities, and to manage problems remotely. We are very proud of what the team has been able to do in a very short time.”
While the aviation sector was significantly affected by the lockdowns, the company continued with its work in this sector, deploying data tools such as event measurement systems to optimise airline performance during times of severe disruption. GE Power has provided maintenance strategies and digital solutions to power utilities and independent power producers across sub-Saharan Africa during this period.
The company is using digital innovation to help efforts to address Africa’s other longstanding health challenges, such as tuberculosis, helping to scale early diagnosis interventions and ensuring more effective interventions in problem areas.
GE’s healthcare contributions are an important component of its country to company deals that it has with Nigeria and Kenya.
“Our key collaboration with governments is to align our work with their national plans for infrastructure development and enhancement across the continuum of care. We are very strongly focused on building the base of pyramid.”
In Nigeria, in addition to its extensive work in the power sector, the company is working with governments at the federal and state levels to develop specialist health skills at scale while servicing and maintaining infrastructure in hospitals. In Kenya, it is modernising radiology units in 98 hospitals in a collaboration with the government, while specialist training continues in the fully fledged training centre it has established there.
“We are always looking to collaborate with governments under country to company deals and outside of them,” he says. “It helps not only to strengthen healthcare infrastructure but also to build capacity and clinical capability. We are trying to ensure that governments move away from the traditional system of building and equipping hospitals but often overlooking the provision of maintenance and training.”
Attitudes are changing, says Fezoua who drove GE’s healthcare segment for more than eight years. “I see a huge awareness now for more sustainable solutions at the Ministry of Health level and even at the level of the presidency. They realise that if they want to change the game, they need to apply different ways of dealing with infrastructure.”
“It has been a big mission for us to work on sustainable solutions. We don’t want to sell equipment for the sake of selling it. We are committed to ensure that whatever infrastructure we build delivers the highest level of quality over the years and to do that, we have to maintain it.”
Servicing and maintaining its equipment for customers is a critical part of its product mix. But it has not been easy to persuade African clients that service contracts are important. “If we cannot ensure our tech is working
properly, we would be failing in our duty to clients. But increasingly they understand that to be effective, they need to have reliable infrastructure and technology.
He says the pandemic has accelerated the delivery of social sector infrastructure, particularly in health and education, which marks a shift from the focus on hard infrastructure in the power and transport sectors, for example, over many years. This speaks to a new emphasis on sustainability.
The economic benefits of this now are more important than ever as the continent faces its worst recession in decades, with the prospect of about 40 million people falling into extreme poverty.
“Infrastructure is definitely a key priority for economic recovery. However, the ability of governments to allocate public funds for infrastructure in the coming months and even years will be severely constrained by a contraction in revenues resulting from the pandemic. It will be tough for governments to offer the comfort of sovereign guarantees on infrastructure in the near term too.”
Debt levels also are expected to rise in the post-pandemic rebuilding phase, while ratings downgrades of countries such as South Africa and Nigeria during the pandemic have limited their ability to raise finance internationally and at the right cost.
A package of blended resources will be necessary for infrastructure delivery, says Fezoua. This would typically include grant and development assistance funding and long-term concessional loans.
The funding gap for infrastructure is already too wide, he says, and some creative thinking is needed to find finance mechanisms to ensure this gap does not widen further as the continent charts these choppy waters.
“Every dollar of development funding can crowd in more than $4 of private sector capital,” he says. This has the potential to de-risk the investment. The risk-return equations in social investments make it hard to attract private sector capital to sectors such as health and education. “This is why we need to leverage blended financing – to crowd in much more private and development funding.”
Risk mitigation, he says, will require more collaboration between the public and private sectors and GE is ready to play a role by being involved in projects at an early stage.
Improving expenditure outcomes in Africa is at the core of GE’s business. By leveraging technology and building specialist skills, equipment and infrastructure, the company aims to decrease the cost of delivery and increase access to quality services such as healthcare. “These principles are always top of mind in our collaboration with the public sector,” he says.
In Kenya, making high quality diagnostic imaging equipment available at district level has resulted in a 30% reduction in the average cost of scans while the number of users has increased. The number of women having mammograms has doubled as a result of installing the equipment in 50 hospitals in Kenya.
Fezoua says GE is aligned to the African Development Bank’s ‘High 5s’, which are to light up and power Africa; feed Africa; industrialize Africa; integrate Africa; and improve the quality of life for the people of Africa. These focus areas are essential in transforming the lives of the African people.
The company is able to deliver quality services in Africa that are on a par with those its offers in developed markets by building specialist capacity and skills in house, drawing on talent at university level and benefiting from the deep skills pool of Africans from the diaspora. About 95% of its staff and executive leadership in Sub-Saharan Africa are now from the region.
The group’s roots in Africa continue to deepen, with its presence growing from Nigeria and South Africa a decade ago to 22 countries including Kenya, Côte d’Ivoire, Senegal, Ghana and Ethiopia.
“It has been a big mission for us to work on sustainable solutions. We don’t want to sell equipment for the sake of selling it. We are committed to ensure that whatever infrastructure we build delivers the highest level of quality”