China - Africa business connection

Standard Bank group is Africa's largest financial institution by Assets. It all began, for obvious reasons, in South Africa and it had not only expanded northward into the continent but also stablished presence in Hong Kong, Russia and South America. Before October 2007, it could not be considered as a high profit bank on the world financial stage, but that changed when it sold 20% stake to the Industrial and Commercial Bank of China for 5,5$ billion.

Even if we take into account that because Africa is a relatively small economy should grow more rapidly than other countries and regions. Not like the BRIC ones, but faster than south Africa and developed economies.

The OPPORTUNITIES that merge in Africa are those ones related to sectors like food, infrastructure, telecommunications, commodities and energy in markets with high consumption as it could be Nigeria. This sectors are increasingly growing at the same time that Africa grow, as there's also more people who are able to consume obviously. 

But in this region, there are some challenges that need to be met, so despite some costs will be higher, the size of the opportunity is huge as there's lots of potential over there.

The Advice that Jacko Maree, CEO of Standard bank is that you have to be committed with the communities over there. Himself, as a CEO of a bank, can't say that the service that is bringing over there is just helping them with financing requirements and transactions.  

Another advice from Jacko Maree was to look for a good partner over there, who understand the risks and culture from over there, politics, commercial risks and so on so for. For instance, when coca-cola moved to China, had to look for a good name, and a good color which wasn't the black, as black color does not give a good impression to Chinese. So they gave a name which was kêkôukêlè, which is translated as delicious happiness. They also had to change the colour of the drink to red, in order to gain the individuals commitment. Once they've gained the confidence of all the chineese people, they were able to change the name against to coca-cola and put the black colour to their drink. 

That is the role that a multinational should take into Africa's region and it's countries over there. First gain the individuals support by making a good service to the community, and, just afterwars, centering in huge amounts of cash. A local partner should always understand better what to do and why, what are challenges, opportunities, competence, how to face all this things and WIN.

The first role that us, as developed economies should take into account when settling up a new business, is an international overview. Making questions such as: ¿Where should we operate in order to have the highest profits that we could? ¿How should we go there? 

-We should operate in non-developed economies such as emerging economies like China, India, Brasil, Russia, or just short economies with potential, such as Africa's ones. The first think we have to take care in order to operate over there is knowing the language we are going to use. It's not the best thing to have a translator beside you which tells everything the chinese guy is saying, as you are more well appreciated if you have putted interest in talking with they're language and this is well-seen in countries such as China for instance.

My advice is, go for the third language, is not enough to know Spanish and English, but also another one. Try to differentiate, and have an international view. By this three steps, you will increase possibilities to success

Marc Ramon Hernández