Magazine article Global Finance

The Drive to Diversity

Magazine article Global Finance

The Drive to Diversity

Article excerpt

"As anyone who has worked in Africa will know, explains Sachin Shah, head of cash management products, transactional products and services at Standard Bank, which won Best Overall Bank for Cash Management in Africa in this year's awards, "one of the key requirements is to be able to understand and navigate a rapidly changing landscape from an interest [rate], exchange [rate] and other benchmark perspective." Shah says African companies are more prepared to deal with volatility than companies in more-mature, stable economies.

The World Bank predicted lower levels of growth in Sub-Saharan Africa in 2016, with growth falling from 3% in 2015 to 1.6% in 2016. Growth has suffered-in part due to lower prices for resources and commodities-but there is still optimism that growth will remain higher than levels seen in other regions, says Shah. "The drive to diversify dependency away from resource-heavy sectors into the consumer, infrastructure and manufacturing sectors continues across the continent," he notes, "and will set markets up for improved growth rates as the resource environment improves."

Volatility and regulatory uncertainty play a role, but not all key developments in the region are negative, says Shah. "With the advent of increased innovation, we continue to work with our clients to evolve their approach to payments and collections, with a view to both reaching more clients and [reducing] their working-capital cycle." Shah points to digitization, disruption and innovation as key themes that will resonate across most regions this year. …

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