Africa poised to become fastest-growing and most sophisticated market in the world, Kearney Global Retail Development Index
Global management consultancy firm Kearney has released its 2021 Global Retail Development Index (GRDI), finding significant potential for investors and international retailers amongst emerging retail markets.
With Egypt rising 19 spaces up the GRDI to 7th place, and Morocco rising six spaces to 6th place, this year's GRDI takes an in-depth look at Africa, the continent with the fastest growing and youngest population in the world – a consumer generation increasingly urban, affluent, and open to retail technologies such as electronic payments. It also contains a window of opportunity chart tracking individual countries' relative maturity through four stages of opportunity: opening, peaking, maturing, and closing.
Looking across markets, the GRDI notes that fossil fuel-dependent governments see retail as a way of diversifying their economies away from oil dependency. It also shows how the consumer spending world's center of gravity is slowly shifting from the United States and developed European markets to emerging markets in Asia, Africa, and the Middle East. The pace of that development is directly linked to the innovation, penetration, and acceptance of consumer and retail technologies, from simple mobile phone connectivity to sophisticated and secure electronic payment systems.
"This year's GRDI report illustrates how much, and how fast, markets can change and the critical role consumers play in driving that change," said Greg Portell, global lead in Kearney's consumer practice. "What we see in Africa, for example, are multiple examples of modern retailing, underpinned by digital technologies and cooperative governmental policies, leapfrogging traditional models in response to the opportunities created by dramatic population increases, escalating urbanization, and the emergence of an expanding middle class."
"It's really important to remember that in emerging economies commercial opportunity may be high, but it's rarely evenly distributed," said Mohammed Dhedhi, a Kearney partner based in the UAE, who spearheaded GRDI 2021. "Market conditions and potential vary widely between urban and rural China and India for example."
Finally, the real lesson is that all things, especially markets, change—often, as in the case of COVID-19, with little or no warning. So there is no effective substitute for contemporaneous in-market knowledge.
The full report can be accessed here
