
Strong business ecosystems drive SME competitiveness in francophone Africa
Small business in French-speaking Africa struggle to grow and export due to insufficient financial resources. Strengthening business ecosystems is critical to overcome these barriers
Small and medium-sized enterprises (SMEs) in French-speaking Africa are vital engines of economic growth and job creation, yet they face major barriers in scaling their operations and entering export markets. This is largely due to weak financial health, limited production capacity and workforce shortages.
Despite these challenges, most SMEs would like to expand internationally.
That’s the main message of a new International Trade Centre (ITC) report exploring ways to make these companies more competitive so they can enter international markets. The seventh edition of SME Competitiveness in Francophone Africa: Strengthening business ecosystems for exports finds that firms based in countries with strong business ecosystems are better equipped to navigate obstacles and capitalize on growth opportunities.
The report is based on data from 6,493 firms surveyed by ITC and the Permanent Conference of African and Francophone Consular Chambers in 20 francophone African countries in March–July 2024. Only 14% of these firms export, though 54% of non-exporting companies – especially women-led businesses – said they would like to access international markets. Financial constraints are holding them back.
‘Companies operating in robust business ecosystems – where key services such as transport, logistics, certification, trade and investment promotion, and banking are of good quality – outperform those in less developed environments, with fewer reporting a decline in sales (29% versus 43%) and poor financial health (26% versus 47%),’ the report says.
Strong infrastructure lowers costs, reduces inefficiencies and streamlines supply chains, according to the report. Non-exporting firms in countries with well-developed transport networks are three times less likely to see infrastructure as a barrier to entering international markets than those in countries with weaker systems.
Access to reliable banking services also plays a transformative role in business performance. Firms in countries with advanced financial systems are more likely to secure loans and maintain healthy finances, helping them grow and pursue export opportunities. In contrast, low-quality banking systems often leave companies with funding shortages that hinder their expansion.
To address these challenges, targeted measures are essential to enhance the business ecosystem. Improving infrastructure, logistics and financial services is key to supporting SMEs. Investments in these area can unlock their growth potential, increase their participation in global trade and boost sustainable economic growth across the region.