Africa’s exponential population growth, budding workforce, promising economy, maturing infrastructure and investor-friendly policies are propelling the continent into the global spotlight, captivating astute multinational companies (MNCs), investors and trailblazing entrepreneurs.
It is with great enthusiasm that GoGlobal recently announced the official launch of its game-changing Employer of Record (EOR) services and Recruit & Hire offerings across Africa’s most pivotal markets – spanning from North Africa down to Sub-Saharan Africa.
In anticipation of this momentous milestone, we sat down with GoGlobal Partner Nick Broughton and Ashwin Tirvassen, our Regional Director for Africa. Their insights shed light on how the captivating ‘Mother Continent’ is magnetizing an avalanche of international businesses, beckoning them to expand operations, seize untapped consumer markets and harness the potential of its up-and-coming talent pools.
Why do you think there is growing interest in expanding into Africa among MNCs?
Nick: Africa has rapidly transformed from being a future prospect to a land of immediate opportunities. With its vast size – spanning over 30 million square kilometers and 54 countries – Africa is larger than China, the US, Europe and India combined. Its booming population of over 1.3 billion people also speaks more than 1,500 languages, including large segments fluent in English, French, Arabic and Portuguese.
Notably, Africa also has a youthful median age of 20, making it a dynamic hub of business potential powered by digital natives and a fresh mindset.
Ashwin: Here are a few of the other key draws for MNCs:
- Burgeoning economy: The African economy has been experiencing steady growth, outpacing many developed regions. Several African countries have been consistently recording impressive GDP growth rates, driven by sectors such as manufacturing, services, telecommunications and agriculture.
- Maturing infrastructure ready for investment: Africa’s infrastructure landscape has undergone significant improvements in recent years. Investments in transportation networks, telecommunications, energy and logistics have enhanced connectivity and facilitated business operations across the continent. While Africa holds immense promise, it is important to acknowledge that there is still room for improvement in its infrastructure. Addressing this gap will likely require substantial foreign investment.
- Favorable policies: Governments across Africa have increasingly adopted investor-friendly policies, creating an environment conducive to business growth. Measures such as deregulation, tax incentives, and streamlined administrative processes aim to attract foreign direct investment (FDI) and promote economic development. MNCs recognize these positive shifts in the regulatory landscape and view Africa as an attractive investment destination.
- Untapped consumer markets: Africa’s rising middle class and expanding consumer base present untapped markets for a wide range of products and services. As disposable incomes increase and consumer preferences evolve, MNCs see Africa as a prime opportunity to introduce their product lines, establish brand presence and capture market share in sectors ranging from consumer goods to financial services.
- Up-and-coming, cost-effective talent pools: Africa is home to a pool of talented individuals with diverse skills and expertise. The continent’s growing youth population offers a valuable resource for MNCs seeking skilled workers and innovative thinkers. By tapping into Africa’s talent pool, MNCs can foster a dynamic workforce and benefit from fresh perspectives, localized insights and cost-effective operations.
What types of organizations are most likely to benefit from expanding into or hiring in Africa?
Ashwin: Organizations across an array of industries stand to benefit from expanding into or hiring in Africa, leveraging the continent’s abundant opportunities. These include:
- Infrastructure development: With the need for significant infrastructure improvements, companies specializing in construction, transportation, supply chain management, energy and telecommunications can play a pivotal role in shaping Africa’s future.
- Agribusiness: The time is ripe for Africa’s agribusiness revolution. Despite importing around $40 billion worth of food annually, the continent boasts abundant resources and favorable climates for agricultural activities. By making strategic investments and implementing initiatives, MNCs can help Africa reduce its dependence on imports and cultivate a thriving local food industry.
- Consumer goods and retail: Africa’s rising middle class and expanding consumer base present fertile ground for companies in the consumer goods and retail sectors. This includes industries such as fast-moving consumer goods (FMCG), fashion and electronics. According to Africa Business Communities, the continent’s thriving e-commerce industry is expected to generate annual revenue of $46.1 billion by 2025.
- Financial services: As Africa’s economy grows, the demand for banking, insurance, fintech and other financial services is on the rise. Much of the population remains unbanked at the moment but this will inevitably change in coming years. Companies with expertise in these areas can tap into the continent’s evolving financial landscape. According to McKinsey, Africa is the world’s second-fastest-growing payments and banking market. It is also home to over 500 fintech firms, primarily in Nigeria, South Africa and Kenya.
- Non-governmental organizations (NGOs): Africa attracts NGOs from around the world due to its pressing humanitarian needs, development potential, focus on global health initiatives, environmental conservation efforts, promotion of social justice, human rights priorities, collaborative partnerships with local organizations and advocacy for policy changes. NGOs play a crucial role in addressing challenges, empowering communities and fostering positive social transformation across the continent.
- Technology: Africa’s burgeoning digital transformation offers significant opportunities for tech and telecom companies. From mobile services and internet infrastructure to software development and digital solutions, there is a growing demand for innovative technologies.
Nick: In terms of geography, it is worth noting there is already considerable interest from various international players in Africa.
- China: Chinese companies have been actively seizing opportunities in African markets, propelled by China’s ambitious Belt and Road initiative. This vast infrastructure and development project serves as a catalyst, incentivizing Chinese companies to invest in Africa to foster trade synergies.
- Asia Pacific (APAC): In addition to companies from China, neighboring countries in the Asia Pacific region are also expressing a strong interest in Africa’s vast potential. These companies recognize the immense opportunities for growth, expansion and mutually beneficial partnerships that Africa offers.
- Europe: European companies, drawn to the continent’s similar time zones, find hiring for functions like customer service and IT support convenient in Africa.
- North America: Despite being an ocean away, US and Canadian companies are keen to bring their products and expertise to become part of the remarkable success story unfolding in Africa.
- Middle East and North Africa (MENA): Last but not least, businesses from neighboring countries in the MENA region are also displaying a keen interest in the vast potential across the entire continent. These companies recognize the strategic advantage of proximity and cultural ties, enabling them to establish strong economic and trade relations.
By seizing the potential across these industries and harnessing the existing interest from global players, companies around the world can position themselves for success and contribute to Africa’s remarkable growth trajectory.
Why are more companies choosing to build their teams in Africa through an Employer of Record (EOR)?
Ashwin: Strategic companies are increasingly opting to build their teams in Africa through an EOR for several compelling reasons. While Africa’s youthful, fast-growing talent pool is brimming with promise, navigating cross-border human resources (HR) can be a complex endeavor. The intricacies of local labor laws, employment regulations, tax obligations and cultural nuances pose significant challenges for companies expanding their teams in Africa:
- Employment regulations: Each country has specific laws on contracts, working hours, leave and termination. Non-compliance can lead to legal consequences and a damaged reputation.
- Payroll and taxation: Navigating complex tax systems, social contributions and deductions is crucial. Errors may result in penalties and legal complications.
- Benefits and compensation: Varying practices require understanding and alignment. Neglecting appropriate benefits impacts satisfaction, recruitment and retention.
- Cultural diversity: Sensitivity to norms, values and diversity is essential. A lack of understanding can cause conflicts and lower morale.
- Employee relations: Effective communication, grievance handling and fostering a positive environment are vital. Adapting to local work culture is key to strong relations.
Nick: These challenges are where an Employer of Record (EOR) can play a pivotal role. The right EOR partner will implement a comprehensive solution to handle the legal, administrative and HR aspects of employing workers in the African country at hand. This includes navigating the complexities of compliance, payroll, benefits administration and employment regulations in Africa. With the right EOR partner at their side, companies can focus on their core business operations while safeguarding legal compliance and mitigating HR risks.
The EOR model offers companies flexibility and scalability, enabling them to quickly establish their presence in Africa without the need for establishing legal entities or managing the intricacies of local HR processes independently. It streamlines the process of onboarding and managing talent in Africa while minimizing administrative burdens and time-consuming tasks.
What makes GoGlobal’s services in Africa different?
Nick: While the talent market in Africa runs deep, finding and attracting the ideal candidates can still be a daunting task – particularly for specialized and hard-to-fill positions such as those in sales, IT and customer service. That’s where GoGlobal’s one-of-a-kind Recruit & Hire solution shines.
Our comprehensive offering provides end-to-end recruitment services, supporting our clients in building exceptional teams in Africa and securing the right individuals for their specific needs. By seamlessly complementing our Employer of Record (EOR) services with Recruit & Hire, we streamline the entire process of talent acquisition and onboarding.
With GoGlobal’s Recruit & Hire solution, our clients gain access to a wide range of resources and expertise. Our global team, with a presence in over 120 countries, possesses in-depth knowledge of local talent markets and understands the intricacies of sourcing and recruiting top-quality candidates in the various hiring landscapes across Africa.
Whether you are searching for technology experts, sales professionals or client service specialists, GoGlobal’s Recruit & Hire solution has you covered. We have the expertise and networks to identify and attract the best talent for specific roles and industries. Our dedicated in-country experts assert compliance with local regulations and seamlessly take on the recruitment process from start to finish.
By entrusting GoGlobal with your recruitment needs, you can focus on your day-to-day business while we handle the complexities of sourcing, screening and hiring top talent.
Ashwin: GoGlobal’s EOR services are unrivaled around the world and our niche in Africa truly sets us apart. Our boots-on-the-ground presence allows us to deliver exceptional service and unparalleled capabilities.
We take a people-first approach to HR at GoGlobal. We forge strong relationships with our clients and their workers, placing their needs at the forefront of everything we do. Our deep knowledge of each country’s unique cultural customs, language and regulatory environment empowers us to provide tailored and personalized solutions.
By partnering with GoGlobal, you can trust that your HR needs are in capable hands. From compliance management to payroll administration, we handle it all — allowing you to concentrate on your core business goals and growth strategies.
Our unwavering commitment to excellence empowers you to unlock the full potential of building a remarkably successful team. Choose GoGlobal and embrace a future brimming with endless possibilities in Africa.
Contact us to talk with an international HR expert about expanding, recruiting and hiring in Africa.