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Now is the time for an Africa turnaround: German economy must better utilize Africa's markets

Africa is one of the most dynamic economic regions globally, but Germany is still underutilizing this potential. While trade is picking up again, competition and geopolitical risks are also increasing. An 'Africa turnaround' is necessary for German businesses to fully capitalize on the continent's opportunities in the future.

Africa's markets are growing rapidly, its population is young, innovative, and increasingly consumer-oriented. In light of South Africa’s G20 presidency and the strategic promotion of Africa’s importance outlined in the coalition agreement, the region is gaining more attention. The DIHK and SAFRI emphasize: Those who are not present in Africa today risk missing out on vital opportunities in the future.

This contribution was the topic of the week in the newsletter for week 40 in 2025.

Africa enters the economic spotlight

Africa is no longer a peripheral topic in economic policy. The continent’s economies are growing, youthful, innovative, and developing increasing purchasing power. In light of South Africa’s G20 presidency and the coalition agreement’s strategic upliftment of the region, it is evident: Ignoring Africa now risks missing opportunities tomorrow.

Trade regains momentum

German-African goods trade amounted to €58.4 billion in 2024 – representing only 2% of Germany's total global trade. Exports decreased by 8.5% compared to 2023, totaling €26.3 billion, while imports fell by 2.1% to €32.1 billion. However, recent trends indicate otherwise: From January to July 2025, German exports to Africa increased by 7%, while imports rose by 3%. While global trade streams stagnate, business with the continent is gaining momentum.

Obstacles remain in market access

Despite the vast opportunities, German businesses face challenges in conducting trade with Africa: Political uncertainties, deficits in infrastructure, energy, logistics, and limited financing often hinder market access. Added to this are bureaucratic hurdles and growing competition from companies in China, India, or Turkey, which tend to operate more swiftly and take greater risks. To tap into Africa’s potential, it is crucial to plan long-term and utilize existing support services – such as the offerings provided by ten German chambers of commerce abroad (AHKs) on the continent.

Africa as a chance for diversification

It is undeniable: Africa opens access to dynamic markets for German businesses and, especially given geopolitical tensions, can help reduce one-sided dependencies on China or the USA. The Subsahara Africa Initiative of German Business (SAFRI) therefore calls for an "Africa turnaround": a rethink in politics and economics to fully embrace the opportunities on the continent.

Five key levers for an Africa turnaround

How can this turnaround begin? SAFRI identified five key action areas:

Strengthening local value creation – Establish industry hubs, technology transfer, and on-site training to build stable supply chains for German businesses.
Creating reliable framework conditions – Support the African free trade zone (AfCFTA), prioritize EU economic partnership agreements, and improve investment security.
Expanding resource partnerships – Design these partnerships to benefit local processing, enhance supply security, and boost resilience.
Promoting innovation and digitalization – Investments in networks and data centers unlock an Internet economy with billion-euro potential.
Simplifying financing – Through guarantees, double taxation agreements, and tailored instruments for small and medium-sized enterprises.

More detailed elaborations will follow in the position paper "Africa Turnaround Now." This release is scheduled for mid-October.

From appeal to political agenda

Africa is the world’s second fastest-growing economic region. This provides diverse opportunities for German businesses. To leverage these, it is vital to rethink support structures, enhance industrial collaboration, and advance policies with determination. The Africa turnaround answers a critical future question: How will German businesses join the growth opportunities on the African continent?