African economy relies on family businesses, says LCCI DG
The Director General of the Lagos Chamber of Commerce and Industry (LCCI), Dr Chinyere Almona, has described family businesses as the backbone of the African economy, constituting 80 percent of the continent’s businesses. She spoke in Lagos during the third edition of the Africa Family Business Summit (AFBS’24) with the theme “Governing Your Family business […]
Dr. Chinyere Almona
The Director General of the Lagos Chamber of Commerce and Industry (LCCI), Dr Chinyere Almona, has described family businesses as the backbone of the African economy, constituting 80 percent of the continent’s businesses.
She spoke in Lagos during the third edition of the Africa Family Business Summit (AFBS’24) with the theme “Governing Your Family business into the future.”
The two-day AFBS, one of the biggest gatherings of businesses in Africa, attracted over 200 participants from across the continent.
“Next Generation Panel Discussion,” one of the roundtable discussions at the summit featured managers of family businesses which have survived to the second and third generations.
In her remarks, Almona noted that family businesses contribute significantly to employment generation and Gross Domestic Products (GDP) growth in Africa.
She said, “As members of African businesses, family businesses or those who provide service to family businesses, you would know that family businesses are the backbone of the African economy and they contribute significantly to employment and GDP growth.
“Statistics reveal that Africa family businesses constitute 80 percent of all businesses in Africa and are responsible for about 70 per cent of employment in some countries. In some countries, it is about 90 per cent but an average of 70 per cent.
“They also outperform their non-family counterparts in terms of longevity and resilience thanks to their strong commitment to sustainable practices and community engagement.”
She advocated strong collaboration among family businesses to drive the African economy.
The DG also expressed LCCI’s commitment to be a major part of the African Continental Free Trade Area, AfCFTA, saying “We can’t be left behind. We must ensure that we move the barriers and the blockade and the mountains before businesses as they engage regional trade.”
In his presentation titled, “Need for wealth planning to secure family legacy for the next generation,” Sven Nicolas Haudenschild, Managing Director, Estate Planning of the IPG Howden Switzerland, said 70 per cent of wealth transfer fail by the second generation, while only 10 per cent survive to the third generation.
He identified family dispute, taxes, outstanding liability, wealth dilution from legacy transfer, creditors’ claim, cross border wealth transfer as part of reasons why it is so difficult to pass on wealth intact.
In his welcome address, Dr Sydney Vanderpuye, Director of Finance, ECOWAS Bank for Investment and Development, said the summit remains a pivotal platform to exchange ideas, chart a path towards a more prosperous and defining future for family businesses across the continent.