Despite the focus of emerging-market investors on the BRIC countries (Brazil, Russia, India and China), it is in Africa, a region with the world’s second-fastest growth, where the next big business opportunities lie, says Joseph Jimenez, CEO of Novartis.
In an article for Gulf News, Mr. Jimenez points out that in about one-third of the continent’s 55 countries, annual gross domestic product growth is above 6 per cent and Sub-Saharan Africa grew at an estimated 5.1 per cent in 2013.
Foreign investors report that their return on investment in Africa is higher than in any other emerging region. By 2040, the continent’s working-age population will total an estimated 1.1 billion people, providing businesses with a larger labour pool than even China or India.
Moreover, economic expansion is taking place not just in urban centres, but in small towns and villages as well, he adds.
Speaking in December last year at the company’s first-ever Novartis Africa Day, Mr. Jimenez said Novartis was “taking an outcomes approach, looking beyond therapeutic solutions to a focus on new technologies, new commercial models, education and training.”
Access to medicines can be improved without weakening intellectual property regimes, he said during the event held at the company’s international headquarters in Basel, Switzerland. Mr Jimenez believes tiered pricing could be one way to deal with the challenge of what also remains a price sensitive market.
The article stresses however that Africa also faces major challenges. One of the biggest concerns is inadequate health care. Life expectancy is 14 years below the global average with nearly one in 20 adults in the 15-49 age group in Sub-Saharan Africa living with HIV — roughly six times the global average.
Africa also faces an increasing epidemic of chronic, non-communicable diseases (NCDs) due to the ongoing rapid socio-economic and demographic transition which is expected to account for a much greater burden of disease. NCDs are projected to become the most common causes of death by 2030.
The number of diabetes cases, for example, is expected nearly to double over the next two decades, says Mr. Jimenez in the article. If left unaddressed, the dual burden of communicable and NCDs could jeopardise Africa’s economic potential. To avoid this, three critical areas of health care must be addressed: Technology, infrastructure and education.