Africa regional analysis


Market growth
Based on various economic forecasters, the African continent had a total GDP of some US $800bn in 2005. There is a large variance between the largest economy South Africa (US $210bn GDP) and the poorest country in the world, Lesotho (US $1bn). This extreme is also reflected in the size of the industrial gases business across the continent. Industry analysts believe that the total industrial gases business reached US $980m in value in 2005 but has grown by an estimated 15% in 2006.

The largest market and the most industrially advanced
remains South Africa, which accounts for about 40% of the total market. There are a few other countries with notable gas markets – these include Egypt and Nigeria. The rest fall within the band of $3m to $50m markets in size.

The most significant change during 2006 is that the Linde Group has acquired the No.1 position in Africa following the completion of the BOC deal in September last year. This has not really changed the structure as Linde has increased its presence by merging its businesses in Northern Africa with that of BOC (south of the Sahara) but we understand the North African business is managed out of Europe still.

What is noticeable from our interviews with certain companies across the Continent and that with Allan Copper of Air Products, is that there is certainly a shortage of utilities (mainly power) which restricts the ability to increase production of gases and there is also a common message that there is a shortage of some gases in the region or the infrastructure to supply gases to certain markets is under-developed. This particularly applies to CO2, argon and helium. Interestingly, there is also a shortage of ISO tanks to use for liquid argon movements throughout the continent.

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