Want to do Business in Africa? Why One Market Strategy Does Not Fit the Continent

One of the most persistent mistakes in international business is treating Africa as if it is a single market. It is not. This is precisely where this article makes an important contribution. By challenging the simplistic idea of “doing business in Africa” (which treats the continent as a unified commercial space), the authors argue that firms need geographically and institutionally differentiated strategies rather than continent-wide assumptions.

The paper presents a broad regional logic for market entry:

• North Africa as a manufacturing platform integrated with European value chains,
• Southern Africa as a financial and corporate governance hub with developed transportation and logistics networks,
• East Africa as a digital innovation ecosystem,
• West Africa as a large consumer-market frontier,
• Central Africa as a resource-driven space.

For executives, investors, and policymakers unfamiliar with Africa’s diversity, this framework is a useful antidote to the dangerous fiction of “Africa as one market”. Yet here lies the article’s paradox. In trying to dismantle one oversimplification, it risks creating another.

While the paper correctly criticizes the homogenization of Africa, it occasionally falls into a second-order simplification: homogenization at the regional level. The problem is not regional classification itself. Grouping countries into regions is analytically useful. The problem begins when those regions are treated as internally coherent systems with relatively symmetrical development patterns.

Reality is far messier. East Africa, for example, is described as digitally innovative and fintech-driven. That description may fit Kenya and Rwanda, but applies far less comfortably to South Sudan, Tanzania, Burundi, Eritrea, or Somalia.

Southern Africa is portrayed as institutionally sophisticated and financially advanced. Yet, the governance quality, infrastructure, and financial systems of South Africa or Botswana differ dramatically from those of Malawi, Zimbabwe, or Angola.

West Africa is portrayed as Africa’s giant consumer market: as if its main economic role were simply to buy, consume, and import. That framing is increasingly outdated. Important manufacturing and logistics hubs are emerging in Ghana, Côte d’Ivoire, and Senegal. Ghana is expanding automotive assembly, pharmaceuticals, and industrial parks around Tema. Côte d’Ivoire is deepening agro-industrial processing and port-centered logistics in Abidjan; and Senegal has invested heavily in the production of textiles, automotives and packaging within the Integrated Special Economic Zone of Diamniadio. West Africa is not only a market of consumers: it is increasingly becoming a region of producers, processors, and logistics platforms.

On the other hand, Central Africa is reduced largely to extractive industries and weak infrastructure, underplaying accelerating urbanization, telecommunications expansion, logistics development, and agricultural potential.

In short, a multinational entering Nigeria faces a business reality profoundly different from one entering Sierra Leone or Côte d’Ivoire, despite all being grouped under “West Africa”. Likewise, investing in Casablanca bears little resemblance to operating in Libya, even though both fall under the label “North Africa.” These differences extend beyond macroeconomic indicators to include deep variations in business culture, negotiation styles, regulatory practice and informal norms. For this reason, companies seeking to operate in Africa require not regionally tailored strategies, but often country-specific (and in many cases sub-national) approaches that reflect the highly fragmented institutional, business and cultural environments. In Africa, internal national markets remain intensely fragmented even as continental integration (via the AfCFTA) moves forward. Kenya serves as an example. It proves that goods frequently encounter economic "borders" long before they ever reach an international frontier. In this sense, the article risks replacing the myth of “one Africa” with a subtler but equally misleading narrative of “five Africas” which can obscure the continent’s far greater internal diversity and complexity.

A second limitation concerns the conceptualization of business geography. The paper relies heavily on territorial regions, yet contemporary African business increasingly operates through corridors, logistics systems, and metropolitan clusters that cut across administrative boundaries. For many firms, the real unit of operation is not a region like  "North", “East”, “West", "Central" or "South" Africa, but an interconnected business space shaped by logistics, corridors, and market networks. In practice, this operational space is defined less by regional labels than by functional systems such as the Northern Corridor linking Mombasa to Uganda, Rwanda, and eastern DRC; the Abidjan–Lagos coastal growth corridor; Mediterranean industrial-export systems in Morocco and Egypt integrated into European value chains; and major metropolitan nodes such as Nairobi, Lagos, Johannesburg, Casablanca, and Abidjan. Goods, labor, finance, and investment increasingly move through these connectivity nodes or systems, rather than territories defined by purely geographic partitions.

In Africa, competitive advantage is no longer a function of geography. It is a function of who understands (and can navigate) the logistics ecosystems that actually shape how markets work.

The article also ventures into historical claims that feel analytically disconnected from its business focus. For instance, the assertion that: “Africans themselves have never created a unified continental identity” is too categorical. It overlooks the long intellectual and political tradition of Pan-Africanism, anti-colonial solidarity movements, continental institutions, and evolving forms of African cosmopolitan identity.

Similarly, the statement: “There were no countries in Africa before colonization” risks confusing the absence of modern nation-states with the absence of political organization. Precolonial Africa was home to sophisticated kingdoms, empires, confederations, city-states, centralized monarchies, and decentralized governance systems. These political formations may not have resembled the European Westphalian state, but they exercised authority, regulated trade, organized governance, and structured economic life.

The missing reality: Africa’s hybrid formal–informal economy

Perhaps the article’s biggest blind spot concerns informality. The paper treats informality largely as a constraint: something that complicates distribution and business operations. But this framing misses a deeper reality.

Many African economies do not operate through separate formal and informal sectors. They function through a fluid business continuum where the two constantly interact, overlap, and reshape one another. A formal company may depend on informal distributors, trust networks, brokers, and neighborhood retail ecosystems. At the same time, informal traders often depend on formal supply chains, imported goods, digital financial systems, telecommunications infrastructure, and regulated markets.

The result is not two separate economies existing side by side. It is a hybrid commercial system characterized by permeability, adaptation, and continuous switching between formality and informality. In this context, informality is not simply market failure.

It often functions as a mechanism of economic coordination that allows exchange where formal channels remain costly or unevenly accessible, as we explained in this paper. Ignoring this dynamic risks reproducing a formal-sector bias still common in international business literature.

The core insight still matters

Despite these weaknesses, the article makes an important contribution. Its greatest strength lies in rejecting the lazy idea that firms can “enter Africa” with a single strategy.

The central proposition remains persuasive: Companies do not succeed by entering “Africa”. They succeed by understanding the specific institutional, logistical, and market ecosystem in which they are operating. But achieving that understanding requires going further than regional typologies. Africa is not one market. Nor is it simply five. It is a moving landscape of corridors, cities, institutions, hybrid economies, and uneven development patterns that rarely fit neatly into continental (or even regional) boxes.