Top local firms ready to open wallets and invest in Ethiopia

THE continent seems to be an attractive market for South Africa’s listed companies as they look to expand their lucrative operations.

This week three blue-chip companies made it clear that penetrating Africa formed part of their expansion strategies.

The Vodacom Group announced its interest in the Ethiopian telecoms market, after the East African country opened its state-run telecoms monopoly. The group claimed to have said “on many occasions Ethiopia is an attractive market”.

Not to be outdone, the MTN Group jumped on to the band- wagon, saying it was excited by the potential opening up of the Ethiopian market as it would be a natural fit for their existing Pan-African footprint.

MTN Group said Ethiopia presented many exciting telecoms opportunities.

Joining MTN Group and Vodacom Group in their crusade to expand across Africa was diversified financial services group Sanlam.

Sanlam said it planned to enter Ethiopia and Egypt as part of an expansion plan that would see the company expand its footprint to 44 countries – India, Malaysia, the UK, Australia, and many in Africa.

The expansion plan was partly aimed at consolidating Sanlam’s market position in Africa.

The company said it planned to enter Ethiopia by 2021 and had already identified a partner in the country.

Also making news this week was that the South African economy, the largest and most diversified in Africa, shrunk by 2.2% in the first quarter.

This was its biggest firstquarter decline in nine years and helped bring real economic growth for the year to March to 0.8%.

The mining, manufactur- ing and agriculture sectors decreased by 9.9%, 6.4% and 24.2%, respectively, in the first quarter.

Business confidence also took a knock as a result of a decline in exports and imports.

The SA Chamber of Commerce and Industry Business Confidence Index shed 2 index points to 94 points last month and exports declined from R87.3 billion in March to R78.3bn in April, while imports decreased by R1.1bn.

While Eskom offered its employees a 0% wage increase, disgraced international auditing firm KPMG said its decision to let 400 employees go resulted from its loss of lucrative government contracts.