CSIL World Report  

Africa : Overview Of A Promising Market

by Paola Govoni, CSIL Centre for Industrial Studies, Milan, Italy

With 16% of world’s total population, Africa contributes for a 3% to world GDP. Since the year 2000, local per capita GDP has grown faster than in other regions of the world, with the only exception of Asian Countries.

Apparent furniture consumption (at production or import prices, excluding retail mark-up) amounts to US$ 9.6 billion. Africa accounted for 2% of world furniture consumption in 2013 with a per capita furniture consumption of 8 US$, compared to a per capita average of 12 US$ recorded by Asian countries.

Total furniture imports into Africa amounted to US$ 3.6 billion in 2013. Ten main furniture importing countries (each of them importing over US$ 100 million of furniture in 2013) are: South by Paola Govoni, CSIL Centre for Industrial Studies, Milan, Italy Africa, Angola, Morocco, Libya, Nigeria, Algeria, Kenya, Egypt, Ghana and Sudan.

These amounts are not large when compared with international standards. According to CSIL estimate, African furniture imports correspond to about 3% of world imports in 2013, but prospects for growth of the African economies for the near future are interesting.

Africa is richly endowed with resources (in the mining, energy and agricultural sectors) and 35 African countries (out of 54) have an expected annual GDP growth of 5% on average in real terms for the years 2014 to 2016, compared to 3.7% for the world economy. Accordingly, prospects for the local furniture sector are favourable.

A Glance To The Market
Over 60% of the total furniture market in Africa is satisfied by local manufacturers. Total Africa furniture production amounts to US$ 7 billion. 14% of local manufactured furniture is exported, with main exporting countries : South Africa, Egypt, Morocco and Nigeria.

Apparent furniture consumption (at production or import prices, excluding retail mark-up) amounts to US$ 9.6 billion. Main markets with over 500 million of furniture consumption are: South Africa, Algeria, Nigeria, Egypt and Morocco.

North Africa e South Africa are the main consuming regions, showing the highest per capita furniture consumption with US$ 16 and 15, respectively.

In Africa there are 53 metropolitan areas with population of more than 1 million inhabitants in 2015. If we consider only urban population, per capita furniture consumption grows up to US$ 31 and 34, respectively.

Urbanisation process is expected to be very rapid, particularly in Sub Saharan Africa and large urban areas will be the engine of economic growth with important implications for the increase of furniture consumption. Despite political instability and relative poor infrastructure level, there is evidence of a number of urban centres, which offer potential for growth for the furniture market. These cities are increasingly diversifying their economy. In recent years, huge investments have been made in real estate, tourism and hospitality industry, culture and entertainment, which have boosted demand for the furniture sector.

In North Africa the largest furniture consumer is Algeria, followed by Egypt and Morocco and over 68% of furniture consumption is satisfied by local manufacturers. Egypt, Algeria and Mauritania have very low degree of market openness.

In West Africa the first furniture consumer is Nigeria (a large fast growing market), followed by Ghana and Ivory Coast. In West Africa more than 70% of furniture consumption is satisfied by local manufacturers.

Central Africa records the lowest level of consumption among the four African regions and local manufacturers cover about 64% of the domestic market. The largest furniture consumer is the Congo Democratic Republic, followed by Cameroon and Gabon.

In East Africa the largest furniture consumer is Ethiopia, followed by Kenya, Tanzania and Uganda. The fastest growing markets in the region are Ethiopia and Uganda.

Southern Africa is the second largest furniture market. Local manufacturers satisfy 50% of the market. South Africa is ranking first as furniture consumer, followed by Angola, where prospects for growth are particularly favourable.

AFRICA. Breakdown of furniture consumption by region. % in value

African Furniture Import Flows
North Africa and Southern Africa record the highest level of imports among the African regions. Southern Africa has the highest share of furniture consumption coming from foreign suppliers, while North Africa shows an incidence of import on consumption of 30%.

AFRICA. Breakdown of furniture imports by region. % in value

AFRICA. Growth of furniture imports, 2009-2013 US$ million

Outlook For The Near Future
Several African countries have good potential for developing their furniture industry, both for internal consumption and for exports. The more promising prospects are in South Africa, Egypt, Morocco and Nigeria, but also Namibia, Tunisia, Kenya, Zimbabwe are possible candidates for a relevant expansion of their furniture production.

Prospects for growth of furniture consumption in Africa (as average yearly increase in real terms) are favourable for the next two years 2015-2016, with different performance for each different country. Most countries of North Africa and the Sub-Saharian region plus Tanzania, Namibia and South Africa show expected growth between +2% and +4%, with a group of countries like Mali, Burkina Faso, Sierra Leone, Ghana, Gabon, Ethiopia, Kenya, Uganda, Congo, Angola, Zambia, Mozambico and Botswana seeing a promising annual growth of +4% and more for the next two years.

A comparison between furniture consumption growth in Africa and in other parts of the world outlines that Africa sees better prospects than other world’s macroregions like Europe and Americas, with the exception of Asia/Pacific and the Middle East, which are expected to growth by over 5% and by far over 4%, respectivey. Annual growth rate of African furniture consumption in 2015 is forecasted to be close to 4%. For the year 2015, growth of furniture demand worldwide is forecasted at +3.4% in real terms.

CSIL forecast processing is based on macroeconomic data and projections provided by international organisations (particularly the International Monetary Fund and the World Bank) adapted to the specific features of the furniture sector, according to CSIL statistical database and constant monitoring for the world’s 70 most important countries.

Furniture consumption by geographical macroregion, 2015. % forecast of yearly changes in real terms

Publisher: CSIL. Date: October 2014, I edition. Language: English. Online purchase and immediately download at www.worldfurnitureonline.com

The Report ‘Africa Furniture Outlook’ by CSIL provides an overview of the African furniture industry with statistical data for 2013 (production, consumption, imports, exports) and 2014, 2015, and 2016 furniture markets scenario for 54 countries. The 54 country tables include also additional socio economic indicators and opportunities for furniture exporters arising from the increasing imports of African countries, as well as comprehensive key countrydata, allowing a comparison among countries.

Countries covered: Algeria, Algeria, Angola, Benin, Botswana, Burkina Faso, Burundi, Cabo Verde, Cameroon, Central African Republic, Chad, Comoros, Congo Dem Rep, Congo Rep, Cote d’Ivoire, Djibouti, Egypt, Equatorial Guinea, Eritrea, Ethiopia, Gabon, Gambia, Ghana, Guinea, Guinea-Bissau, Kenya, Lesotho, Liberia, Libya, Madagascar, Malawi, Mali, Mauritania, Mauritius, Morocco, Mozambique, Namibia, Niger, Nigeria, Rwanda, Sao Tome and Principe, Senegal, Seychelles, Sierra Leone, Somalia, South Africa, South Sudan, Sudan, Swaziland, Tanzania, Togo, Tunisia, Uganda, Zambia, Zimbabwe.