Why Africa must build resilient supply chains—fast

• By recalibrating supply chains, countries grappling with U.S. tariffs hit can transition beyond exporting raw materials to manufacturing value-added goods, potentially giving rise to new jobs and triggering an industrial revolution.
• With increasing population, Chartered Institute of Procurement & Supplies CEO Ben Farrell says adaptive procurement and supply chain systems could see African economies better harness the continent’s vast wealth of natural resources.
• Ben Farrell: “There needs to be an industrial strategy, trade strategy, a procurement strategy, to help develop a new approach because, frankly, the tectonic plates of trade have shifted and the world as we knew it has gone.”

Globally, multinationals and markets are on edge, constantly calibrating afresh on how to navigate global trade networks in response to the negative impact of U.S. tariffs. With President Donald Trump’s tariff directives tearing up the old trade order, the call for economies in Africa to restructure trade supply chains continues to grow louder.

Speaking in an exclusive interview with The Exchange, Ben Farrell, the Chief Executive Officer of the Chartered Institute of Procurement & Supplies (CIPS), urged players across the procurement and supply chain sector to move with speed in embracing innovation while also advocating for a revamp of intra-African trade.

According to Farrell, while Africa and other economies have entered a new world order under U.S. tariffs, innovative procurement and supply chain systems, coupled with adoption of new tech such as Artificial Intelligence (AI), has the potential to position Africa on a clear path to prosperity and, therefore, wealth for its fast rising population.

Africa’s demographic dividend and economic imperative

“In the next 20 years, Africa’s population will grow very rapidly on account of current demographics. For instance, in Kenya about 70 per cent of the population is under the age of 30, while in Nigeria 60 per cent of the population is under 25 years of age. There is a very young population here that has a desire to grow, learn, and create prosperity,” Farrell told The Exchange.

With increasing population, adaptive procurement and supply chain systems could see economies better harness the continent’s vast wealth of natural resource. At the moment, Africa remains paradoxically poor partly due to systemic inefficiencies in trade and procurement slowing economic growth, observes Farrell.

By recalibrating supply chains, countries such as South Africa and Kenya, which are now staring at huge trade disruptions due to 30 per cent and 10 per cent U.S. tariffs hit respectfully, can transition beyond exporting raw materials to manufacturing value-added goods, potentially giving rise to new well-paying jobs for youth and triggering an industrial revolution.

Why U.S. tariffs could be a catalyst for change

As policymakers burn the midnight oil crafting counter proposals to influence the Trump administration to freeze or cut tariffs on exports, Farrell cautions that: “The horse has bolted, it’s time to think differently.”

He explains: “There needs to be an industrial strategy, trade strategy, a procurement strategy, to help develop a new approach because, frankly, the tectonic plates of trade have shifted and the world as we knew it has gone.”

For him, policymakers may not have to look far to learn best practices on how to transition. Take the case of oil-rich Saudi Arabia, for example, where the U.S. tariffs have evolved into “a catalyst in facilitating Chinese businesses to come to Saudi Arabia all in order to circumvent the supply chain that previously existed,” he says.

Increasingly, Farrell notes, this shift shows that, Saudis, who were previously looking elsewhere for critical supply of finished products, are now building a better home environment… and Chinese manufacturers are trooping in because the country has the necessary infrastructure, including cheap electricity compared to other destinations.

What’s more, U.S. tariffs are not isolated shocks, Farrell notes. They are part of a broad pattern of issues affecting global trade in the last five years, including the Covid-19 economic fallout, the wars in Ukraine and in the Middle East, which have all pushed businesses to restructure supply chains, he highlights.

“All these shocks demands one to have adaptability to run an efficient supply chain. For Africa, we need to think in a global way to respond,” adds Farrell.

CIPS on building resilient supply chains in Africa

For CIPS, the gold standard of the world’s procurement and supply sector with a presence in over 180 countries, procurement is longer an isolated back-office function. It is a strategic lever for economic growth.

CIPS is working with organizations and policymakers in Africa by trailblazing a skills enhancement program to encourage the establishment and running of adaptable supply chains.

Some of the notable areas of upskilling the organization is championing in Africa include championing the deployment of new technology, market diversification and local sourcing.

According to Farrell, automation and the use of AI can drastically help streamline processes, cut costs, and enhance productivity. He cites South Korea as a good example that Africa can take vital lessons on use of emerging tech: “In South Korea, they told me they are 10 per cent more productive as a nation because of using AI to improve processes. This could be applied across Africa in many organizations.”

Australia, where healthcare institutions are using AI to carry out patient diagnosis, is another success story that Africa can learn from, Farrell adds.

Read also: US tariffs hurting growth and development — African leaders

A continental strategy for long-term prosperity

For economies in Africa to optimize the benefits of an efficient supply chain system, Farrell calls for a unified approach.

“Organizations at the African Union could begin to step up and orchestrate more activity to everybody’s long-term prosperity. Think about a regional strategy, a continental strategy because we all know that Africa is extraordinarily blessed with abundance of natural resources, and extremely bright people.”

A continental strategy would encompass harmonizing industrial and trade policies, investment in infrastructure and above all, a solid commitment to ethical best practices.

As seen in Saudi Arabia, for instance, Africa also needs to set up reliable infrastructure and transport system, which are vital ingredients in attracting manufacturers keen on meeting evolving demands of global markets.

The future of supply chain systems in Africa

For industries across the world, the future belongs to those who harness the power of technology. And Farrell’s advice is no different: “We need to embrace AI because this is the new world.” From optimizing pricing through market analysis to cutting red tape, AI has the potential to revolutionize Africa’s supply chains.

By investing in education and upskilling, Africa can build a young workforce capable of driving innovation and turning the continent into a resilient cog in global supply chain.

While U.S. tariffs pose an immediate challenge, leveraging on evolving demographic dividend, embracing novel technologies, and fostering global collaboration could see Africa turn this chance into a spark for economic rebirth.

“Going forward, across Africa, we need to step up in sharing ethical best practices in the supply chain sector and continually improve as individuals and organizations to grow economies and, therefore, wealth for the continent’s rising population,” Farrell concludes.

Read also: Blockchain’s potential in unlocking Africa’s supply chains