PwC plans expansion into African markets

Suresh Kana, the Africa senior partner, said recently that PwC's target was to grow revenue in Africa from $600m to $1bn by 2016.

Earlier this year, PwC said it would spend $100m over five years on skills and infrastructure and recruiting an additional 8 000 partners and staff over five years.

Growth would also include winning additional clients, including those in the small and medium-scale sector, said Kana.

"Our ambition is to grow revenues to about $1bn by 2016 compared to $600m currently, and we believe this is achievable based on our expansion plans," he said.

Rivals such as Ernst & Young and KPMG have also announced similar growth plans in the region whose gross domestic product (GDP) is expected to grow by as much as 5% this year and next.

Africa's GDP is expected to reach 2.6-trillion by 2020, by which time Nigeria is expected to have overtaken SA as the continent's largest economy.

PwC is the largest of the big four auditing and professional services groups in SA based on market share, fee income and staff numbers.

Latest figures showed that last year, PwC's fees in SA up to June were almost R4.5bn compared with Deloitte's R3bn, KPMG's R2.5bn and Ernst & Young's almost R2bn.

Kana said PwC was being attracted to opportunities in sectors such as financial and consumer services, telecoms, resources and infrastructure.

Although he did not say which countries PwC would invest in, he indicated that growth economies such as Nigeria, Kenya, Ghana and Angola were attractive.

Kana said PwC's strategy in Africa mirrored its South African clients who were also expanding northwards. These included the big banks, who have announced plans to acquire and invest in new projects in the region.

There were now also clients in markets such as Kenya who were expanding out of their home base into the region, Kana said, adding that he expected this trend to accelerate in the coming years.

Kana said there was a clear and compelling strategic imperative to expand in Africa.

"We clearly see the opportunity in Africa is huge for a number of reasons. For example, the level of political democracy has improved significantly over the past 18 years and in the past two to three years we have seen the discovery of oil and gas reserves in countries such as Mozambique, Tanzania, Ghana and Angola," Kana said.

He said SA remained a key market for PwC, where it was expanding into the small and medium enterprise sector, from which he estimated the group was deriving up to 40% of its annual fee income.

Source: Business Day