How to Position Your Business for the Global Market: Insights from the Africa Startups and SMEs Export and Trade Summit

Expanding a business from local markets to a global platform is the dream of many entrepreneurs, but the journey is often fraught with challenges. With the advent of the African Continental Free Trade Area (AfCFTA), this dream is becoming increasingly achievable for African startups and small and medium enterprises (SMEs). At the Africa Startups and SMEs Export and Trade Summit, industry experts shared invaluable insights into leveraging the AfCFTA to scale businesses across borders.

Peter Adetor, Team Lead of the African Startups and SMEs in Export and Trade Secretariat (ASSETS), offered powerful strategies for tapping into this opportunity. He emphasized the importance of not only having a viable business but also being adequately prepared to engage in international trade under the AfCFTA. This article captures the essence of his discussion and highlights how businesses can position themselves to thrive on the global stage.

The Promise of the AfCFTA: A Game-Changer for African Businesses

The AfCFTA represents one of the most significant opportunities for businesses across Africa, providing a unified market of over 1.3 billion people. For startups and SMEs looking to expand, the potential is enormous. However, as Peter pointed out, many businesses lack the crucial information and strategies needed to take full advantage of the AfCFTA’s benefits.

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Information is the cornerstone of successful trade under this agreement. Without a deep understanding of policies, connections, and funding opportunities, businesses may struggle to expand beyond local borders. ASSETS has witnessed both success stories and failures—those who embrace training and information thrive, while others who neglect these essentials find themselves hindered at borders.

Key Strategies for Expanding Beyond Borders

To successfully scale beyond the local market, businesses need to adopt a few critical strategies. Peter highlights three essential factors for businesses aiming to thrive in the global market:

1. Financial Sustainability: Investors and funding institutions focus on the financial health of a business before committing resources. Entrepreneurs must ensure their financial books are in order, with clear projections for the next two to three years. ASSETS helps businesses by assessing their sustainability through effective financial management, succession planning, and accounting practices.
2. Investment Readiness: Positioning a business to attract investment is another critical step. Funders are looking for viable businesses with clear growth strategies. Peter emphasized that having a strong financial foundation and strategic positioning will make your business attractive to investors.
3. Capacity Building: One of the most significant challenges for African SMEs is a lack of capacity to meet growing demand. Governments and organizations like ASSETS play a crucial role in providing training and resources to build business capacity. This involves more than just financial assistance; it includes comprehensive training on how to navigate international trade under the AfCFTA.

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The Role of Governments and Policies in Supporting SMEs

Governments have a vital role to play in creating an enabling environment for businesses to scale. One of the major barriers to growth is the high cost of credit, with interest rates in some countries like Ghana exceeding 30%. In contrast, neighboring countries offer more favorable rates of 1% to 2%, which encourages growth. By adopting policies that support lower interest rates and offering more flexible loan terms, governments can help fuel the growth of SMEs across the continent.

Peter stressed that SMEs are the backbone of any economy, accounting for over 80% of global employment. Supporting these businesses means fostering job creation, reducing poverty, and boosting overall economic growth.

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Breaking the Mental Barriers: Think Beyond Local Markets

One of the key takeaways from Peter’s talk is the need for a mindset shift among African entrepreneurs. Too many businesses limit their scope to local markets, like Accra or Tamale, missing out on the immense potential beyond their borders. With high demand for African products across the continent and the world, entrepreneurs should view the AfCFTA as a gateway to tap into these markets.

Conclusion: How You Can Succeed

The AfCFTA presents African entrepreneurs with a unique opportunity to expand their businesses and participate in a growing, interconnected market. By adopting the right strategies, focusing on financial sustainability, preparing for investment, and taking advantage of capacity-building opportunities, SMEs can thrive on the global stage.

Watch the full interview with Peter Adetor on our YouTube channel to learn more about how to position your business for global success under the AfCFTA. Don’t miss out on actionable insights that can help you take your business from local to global.

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