AEROTROPOLIS AFRICA

Sub-Saharan Africa has incredible natural agricultural resources operating at 0,1% of capacity, while global food shortages are a threat. The people in the region are also the poorest in the world.

The main reasons are a lack of regional integration, and access to global markets, inefficient distribution and logistics coupled with the distance to dispersed small producers.
40% of African farmers live more than 4 hours of the nearest input retailer!

The timing of the G20 SME Finance project is opportune.
The biggest South African Government agencies want to leverage the O.R. Tambo International region as the key to regional integration of Sub-Saharan Africa.

Public intervention can be maximized by ensuring SME interests are properly planned and catered for in this global project.
The profound SME finance impact lies in generating supply-chain finance income streams which can be leveraged.

OUR VISION FOR 2025:
Sub-Saharan Africa produces $2 Trillion in high-value agricultural products annually. Most is bought by large multi-nationals under contract procurement
Small-farmer organizations and co-ops conclude new deals directly with global corporations in the O.R. Tambo International Airport City Trade zone.
All major African governments are represented and foreign companies can get all regulatory approvals within 48 hours.
Millions of SME’s act as a vibrant conduit for finance, technical assistance and as “Aggregators” for small producers.
All small-farmers have an SME agriculture input-retailer within a 6 kilometer radius.
These “last mile” distribution channels are leveraged “dual way” with retail and input items going back on the same transport that brought produce from the farm.
Cost-efficient distribution takes the high-value, low weight items to the nearest airport, to reach the O.R. Tambo Aerotropolis the same day. This global node processes 3 million tones of goods p.a.!
Products are processed and quality goods are landed in Europe, Asia and other continents within 48 hours.
Global impact investors all have offices here. Multi-nationals have their African headquarters and space in the unique R&D facilities. BoP representatives come in by train and meet global SME social entrepreneurs.
New product innovations are rolled out daily and successful models applied around the world.
Village representatives flown in on sponsorships, social entrepreneurs and philanthropists learn about global SME commerce models and finance in the Expo environment.

All this was made possible by the G20 SME Finance competition which created global focus for Aerotropolis Africa!
$3 m in grant funds, corporate lease commitments and global focus created the world’s greatest success stories, with the UNMDG’s achieved in Africa, as well.

IMPLEMENTING THE VISION
$20 bn existing assets and major Government initiatives underpin Aerotropolis Africa
$1,4 m fast-tracks the mapping of the existing Aerotropolis assets and G20 representatives and corporations share the plans to see how they can benefit by linking.
An additional $1,6 m is used to identify the most likely global beneficiaries and to sequence and prioritize relevant initiatives.
Global workshops are facilitated to aggregate input on maximizing efficient planning to include SME’s and inclusive markets initiatives.
The global corporations already involved with BoP organizations realize the benefits and commit to take space in the Airport city.
100 leases at $50,000 p.afor 10 years at $50,000 p.a. creates the required catalyst.

A major barrier to trade in Africa is the long delays on road transport and unfortunate interventions.
Air trade is growing and represents almost 40% of trade in value.
It is far easier to monitor and control movements via Airports
Focus will be shifted to high value/ low weight products e.g. higher nutrition value, lower weight.
The "thick borders" can be addressed with trade by air.

We believe the biggest barrier to SME finance in Africa is the lack of positive income streams.
The key reasons and how Aerotropolis Africa addresses these issues are listed below:
o Lack of regional integration
 Global nodes like Singapore’s Changi, Amsterdam Schiphol Airport Area, Frankfurt and others have volumes and economies of scale which no single area in Africa can remotely match. Consequently we start with a 4 to 9% cost disadvantage.

Solution:
 The existing Aerotropolis assets and volumes present the logical hub for regional integration.
 The Airport City provides a global market place where African governments are represented and multi-national corporations have HQ’s.
Problem:
o Lack of access to global markets
 “Middlemen” pocket as much as 50% to 60% of profits in the value chain from farmer to consumer2
Solution:
 The Trade centre allows deals between manufacturers/ small-farmer organizations and global buyers directly, reducing “middle-men” cost
 The Trade/Expo node allows direct trade between corporations and producer organizations
Problem:
o Inefficient logistics and distribution across distant and dispersed markets:
 30% of fresh produce and 50% of perishable products may be spoiled before it reaches the consumer…
 40% of African farmers live more than 4 hours of the nearest input retailer2
Solution:
The Aerotropolis creates the framework to fast-track SME solutions.
A globally visible “Plug & Play” environment for all stakeholders to create “end-to-end” value chains for new products and services sourced from the poor and aggregated through SME’s as conduits of finance, technical assistance and organization.

Like the internet infrastructure, a ‘Plug & Play” allows SME solutions to be scaled quickly
In the same way that the internet has spawned billions of applications, and allowed new business concepts like Google to scale rapidly, the Aerotropolis can generate collaborations and finance solutions we never imagined
This unique global environment will be designed to promote a “Silicon Valley” to fast-track SME specific product innovations and business models.

We see a huge opportunity for global SME solutions by leveraging the unique first/third-world mix in South Africa.
Relatively low costs, direct access to third world markets, proximity to landlocked countries and first-world living conditions make the South African location ideal to fast-track SME solutions.

Aerotropolis Africa is a holistic solution, addressing, not only SME finance, but all the factors limiting SME growth including:
o A lack of knowledge about the poor,
o Inefficient regulatory environments,
o Inadequate physical infrastructure
o Missing knowledge and skills and
o Restricted access to finance