“Things happen there much slower and the rules can change from day to day. You have to spend a lot of time following up on everything. You also have to know all your facts and stand firm so nobody can try and take you for a ride,” said Bhojwani.
But the rewards outweigh the risks, investors said. African countries have a combined economy worth $1.44 trillion, according to the World Bank, and a domestic market of about 900 million people.
The African Development Bank forecasts that Africa's economy will grow by 4.5 percent in 2010 and 5.2 percent in 2011.
“We think Africa can be really big,” said Christine Tan, managing director of GMT Investcorp, which has opened its first Gucci boutique in South Africa since 1996.
The company, which has the sole rights to sell Gucci, Bally, Pateke Phillip, and ST Dupont, among others, in South Africa and is planning to add more luxury brands to its fold and to expand to other countries.
“A lot of our customers are from countries like Nigeria, Angola and Namibia,” she says. “We are now aggressively making plans to bring our business to other African countries.”
Singapore, which has a tiny domestic market, has always encouraged its corporations to seek new emerging markets to maintain growth.
“In order to achieve sustainable growth, Singapore companies understand that their market has to be international,” said Lim Ban Hoe, regional director of Middle East & Africa at IE Singapore.
“While traditionally, much of the attention has been on Asia, in recent years, Singapore companies are also looking at emerging markets further afield, including Africa, which has been considered by many as a last frontier in terms of market expansion. “