Major multinational companies are increasingly outsourcing or offshoring their manufacturing operations and business processes to Africa, and these companies are benefiting from ensuing significant reductions in their direct costs; in some cases by as much as 50 percent!

If only the above paragraph was a true reflection of reality. Sadly it isn’t.

It does, however, give an indication of a possible future scenario — just as offshoring and outsourcing to Brazil, India, China and other countries has brought significant benefits to Western companies and the economies of those countries.

Outsourcing and offshoring have been around for a while, although the constituents of the business models and the favoured locations have changed over time. The one common factor that has remained unchanged so far is Africa’s absence from the game.

Does Africa have the potential to become the next major low-cost manufacturing and outsourcing hub? And should global companies be considering the continent as such?

I explored this in a series of articles for Supply Management; Engineering & Technology; Supply Chain Standard; and AfricaFiles.

© Sigi Osagie 2008

Adaptations published as “What Next for Africa?” in Supply Management, 28 Feb. 2008; “African Promise” in Engineering & Technology, 26 Apr. 2008; “Out of Africa” in Supply Chain Standard, Oct. 2008; and “The Next Major Outsourcing Hub – Africa?” in AfricaFiles, Nov. 2008