NAIROBI, Kenya — Virgin Atlantic billionaire Richard Branson sat in a car for two hours on Thursday, snarled in Nairobi’s maddening traffic while trying to reach a conference where business leaders discussed the barriers to commercial success in Africa.
The continent’s roadways — not surprisingly — were near the top of the complaints from participants in the daylong event. One investor noted that in order to ship her goods from West Africa to East Africa her products had to transit through Europe.
Africa appears poised on the edge of a business boom. The continent’s middle class is growing, a half dozen countries are seeing growth rates at 6.5 percent and above, and African leaders predict high returns for international investors. Botswana’s growth rate is near 12 percent, while Nigeria’s and Rwanda’s are both at 7 percent. Kenya is at 4 percent, all according to Trading Economics.
But hurdles remain, including corruption by politicians and other government workers, access to reliable high-speed Internet, unreliable electricity and the continent’s poor highway infrastructure.
Branson said the leaders of African countries must be above corruption, or it will ricochet down to the police and customs agents. His airline, Virgin Atlantic, is losing money on its London-Nairobi route — perhaps in part because of travel warnings concerning Kenya’s fight with Somali militants — but Branson remains optimistic about the continent’s future.
“Africa is growing much faster than Europe or America, and if African countries are led well there’s no reason why Africa can’t be as great and powerful as the Far East,” he said. “You could have a business revolution where you could see growth of 7 to 8 percent in Africa if the countries are run well.”
Tony Elumela, the chairman of Heirs Holding Ltd., a private investment firm, told the crowd at the downtown Nairobi conference that Africa’s infrastructure remains a problem, but that global investors will ignore Africa at their own peril.
“All they think of is war in Africa, corruption in Africa,” he said. But later, Elumela added: “I think the global crisis is creating a new opportunity, that when there is prosperity we ask, ‘Why do we have to go beyond the shores of my country?’ But when things are not so good maybe we think, ‘Beyond my country where else can I go?’”
An American social entrepreneur at the conference, Andreas Zeller, advises small and medium businesses and helps them gain access to capital as part of his work with Open Capital. He said he sees a growing number of private-public partnerships in Kenya today, helping get businesses off the ground, but that they still need basic infrastructure, like roads.
“Someone getting their goods to market are taking the roads and the roads are crappy,” Zeller said. He agreed with the view from others that the U.S. hasn’t been proactive enough in Africa.
China is pouring millions of dollars into road projects and developing the energy sector across Africa. But the oil that is being developed in Uganda, for instance, has to go to port in Mombasa, and that Kenyan coastal city needs more investment.
Elumela argued that African leaders need to come together and define continental priorities to advance, like a continental road network and electrical grid. China, he said, can help with both.
James Mwengi is the chief executive of Equity Bank in Kenya and chairs the country’s Vision 2030, a growth plan that is already building new highways and overpasses in the Kenyan capital. He acknowledged Kenya’s infrastructure problem, saying the country’s leaders didn’t develop roads the last two decades. He said Kenya is now tackling the problem, including building a new airport train route.
“We hope by September Richard Branson will not come with a car from the airport to Nairobi,” Mwengi said. “He will come by a commuter train that will take him only 15 minutes, not two hours. The good thing is that four stations are under construction.”
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