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Natural Resources in Africa

NNote: This report is an extract from the book "Grow Rich in the New Africa".

Table of content: Part 1: Forests
  Part 2: Water
  Part 3: Natural Beauty
  Part 4: Minerals
  Part 5: Investments in the Mining Sector

Natural Beauty

Wilderness areas with wildlife represent a unique asset that can only be found in Africa. The travel and tourism industry is exploiting these areas in East Africa and Southern Africa already, but there is still huge potential. Africa has 16% of the earth’s land mass, but records only 3.2% of international tourism receipts (i.e. in-country expenditure by foreign tourists). Tourism development is skewed regionally in Africa. While North Africa (including Egypt) is attracting more than half of all tourism receipts, Sub-Saharan Africa is still lags behind.

From left: The pyramides in Gizeh, Egypt; the Table Mountain in Cape Town, South Africa; the Victoria Falls, Zambia / Zimbabwe; wildlife in the Ngorongoro Crater, Tanzania.

Madagascar has a unique fauna and flora, with the majority of the species being endemic. There is a great potential for additional tourism once the necessary infrastructure (roads, accommodation, services, and flight connections) is put in place. However, developing this infrastructure will require a lot of investments that cannot be managed by the State of Madagascar, which is among the poorest countries in the world. Support by the private sector is urgently needed for exploiting these opportunities.

In East Africa, Kenya is a well-established tourist destination with trained personnel. Future potential still exists in the less known yet attractive areas of the country, i.e. the Great Rift Valley. Tanzania is known to have more animals and less traffic in their national parks than their counterparts on the Kenyan side, offering higher upside potential. The Great lakes along the rift valley (i.e. Lake Victoria, Lake Kivu, Lake Tanganyika, and Lake Malawi) offer good potential as well.

In Southern Africa, Zimbabwe is a prime destination that has yet to reclaim its former share in the travel and tourism business. Before the land deteriorated significantly, it was ranked 2nd after South Africa. When I visited the second highest waterfall in the world in the Eastern highlands of Zimbabwe on a weekend trip two years ago, I did not notice any tourists other than myself and my companions. Our guide told me that the 800-meters high, almost vertical, wall has not yet been climbed by mountaineers. This has so much potential as a tourist site!

However, entrepreneurs that want to engage in the travel and tourism sector, i.e. by operating a resort hotel, running a lodge, acting as a tour operator, should be aware of the risks. If the economic and financial crisis in the industrialized nations deepens, less tourist arrivals can be anticipated which will negatively affect many businesses. On the other side, Asian tourists represent an attractive and fast growing target group that is still neglected by many players. This consumer base might even over compensate a possible decrease of incoming tourists from the U.S. and Europe. Entrepreneurs and tourism managers who can address the specific needs of Asian tourists successfully will be able to excel. Domestic tourism is also a potential market as Africans still visit their tourist sites far less than foreigners on average

> Continue to part 4