Atlas Magazine March 2010

The FANAF Zone: The groups' power

Something good has come out of the crisis. Africa is moving and taking care of itself.
Hardly convinced by the relevance of an African adventure in recent decades, many European groups have withdrawn from the market where they have drastically reduced the scope of their activities. The abandoned field has been quickly occupied by African investors who have rapidly launched in the establishment of regional groups that are able to rival with the most prestigious companies.

The figures displayed on the occasion of the FANAF's 34th general assembly in Kinshasa last February 2010 can only confirm this rise of the African groups.

Henceforth, Colina, Nsia, and Sunu are standing up, in Western Africa, to two heavyweights of international renown: Allianz and Axa.

In fact, the 2008 FANAF zone results revealed a much contrasted situation. On the one hand, there were five groups, three African and two European which control 48% of the total premiums, and on the other hand, a hundred small and medium sized enterprises sharing the remaining 52%.

This concentration is likely to continue in 2010. The “big five” are posting good results and some even have the required resources to make acquisitions.

External growth and the race for premiums should not hide the fact that long-term development does not only rest on financial resources. It is also important to be able to digest new acquisitions and avoid useless investments which weigh down profitability.

More than financial resources, African groups are in need of a sound organizational framework run by top executives capable of ensuring an efficient logistics. The lack of training, innovation, products, ... could stand as a handicap when these groups are facing companies like Axa or Allianz which are logically endowed with more human resources and know-how skills.

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