#BizTrends2025: Unleashing Africa’s economic potential through transformative logistics

Amadou Diallo, CEO of DHL Global Forwarding MEA.

The latest DHL Logistics Trend Radar 7.0 highlights transformative trends in global supply chains, positioning Africa as central to this evolution.

Leveraging supply chain diversification, advanced analytics and AI, green urban logistics, and the evolution of e-commerce, the continent is positioned to create a more efficient, resilient, and sustainable logistics ecosystem. Let’s explore how these factors will drive Africa’s progress.

Redefining Africa’s role in global trade

Africa’s growing relevance as a logistics and trade hub is undeniable, bolstered by the African Continental Free Trade Area (AfCFTA). AfCFTA connects over 1.3 billion people across 55 nations, representing a combined GDP of $3.4t. The agreement serves not only as a trade framework but also as a launchpad for diversifying global supply chains.

Post-pandemic disruptions, geopolitical instability, and natural disasters have increased supply chain volatility by a staggering 183% since 2019. Businesses are reassessing their supply chains to enhance resilience, sustainability, and customer-centricity. With its economic diversity and geographic proximity to Europe, Asia, and the Americas, Africa provides strategic opportunities for multi-shoring to minimise reliance on single regions.

For instance, the continent’s regional diversity enables companies to reduce operational risks by leveraging multiple African hubs. Nigeria’s rapidly growing economy, Kenya’s role as a tech powerhouse, and South Africa’s established infrastructure offer viable alternatives to traditional supply chains dominated by Asia. As manufacturing investments shift under "China+1" strategies, Africa can position itself as the "+1" location for industries seeking agility and cost-effectiveness.

However, realising Africa's full potential in supply chain diversification requires significant investment in infrastructure, such as specialised warehouses and logistics hubs. Public-private partnerships and trade facilitation initiatives are also pivotal to addressing barriers like cross-border inefficiencies.

A game-changer for logistics efficiency

The digital revolution is sweeping across Africa, and logistics is no exception. Advanced analytics and AI transform supply chains by enabling proactive decision-making, optimising resource allocation, and reducing inefficiencies. For Africa, where logistics challenges such as fragmented supply chains, infrastructure deficits, and cross-border bottlenecks persist, AI-driven solutions offer transformative potential.

Take, for example, predictive analytics powered by AI, which can forecast real-time demand surges or supply chain disruptions. This technology is becoming especially relevant with the rollout of initiatives like AfCFTA, where harmonising trade across borders necessitates hyper-intelligent solutions to manage customs clearances, demand forecasting, and inventory optimisation.

AI can also help untangle the complexity of cross-border logistics by integrating real-time data on infrastructure, weather patterns, and geopolitical factors. Companies like Everstream Analytics, for instance, monitor everything from traffic congestion to political instabilities, allowing companies to streamline operations.

With over 60% of Africa’s population under the age of 25, the continent can harness its tech-savvy workforce to drive the adoption of these tools. Governments, too, are making strides, as seen in Morocco's investment in state-of-the-art digital customs systems and South Africa’s integration of blockchain technologies in supply chains.

However, challenges remain. Data governance, fragmented digital adoption, and resource constraints could slow the penetration of AI and analytics. Closing this gap demands robust public-private partnerships and a collective push to enhance digital infrastructure and upskill the workforce.

Pioneering sustainability in Africa’s cities

The African urban population was about 36% in 2010 and is projected to increase to 50% and 60% by 2030 and 2050 respectively. But with increased urban growth comes surging demand for goods, vehicles on roads, and last-mile delivery solutions. It also exacerbates environmental concerns like air pollution and traffic congestion.

Green urban logistics is Africa’s opportunity to rethink how goods flow through cities and reduce emissions. Technologies like electric vehicles (EVs), cargo bikes, and urban consolidation centres hold promise for building sustainable logistics ecosystems. Governments across the continent are already taking steps to facilitate these changes. For instance, Rwanda has introduced incentives for EV adoption, and Kenya’s burgeoning electric two-wheeler market is making waves in last-mile distribution.

But green logistics isn’t just about vehicles–efficient planning is equally essential. Off-peak deliveries, smart parcel lockers, and urban micro-depots can alleviate congestion in densely populated urban areas. Regulatory advancements, such as the establishment of zero-emission zones, could further push this transformation forward.

While green urban logistics faces hurdles—access to charging infrastructure and investment in innovative networks—Africa’s young cities offer a chance to implement forward-thinking policies and leapfrog traditional systems.

Bridging borders through digital trade

Africa’s e-commerce market is soaring, fueled by smartphone penetration, a growing middle class, and improved internet connectivity. GSMA data indicates that the continent has over 700 million mobile users, many of whom drive the surge in online shopping. Digital platforms are making goods and services accessible across borders, aided by the AfCFTA’s single continental market to unlock cross-border e-commerce opportunities.

Digital marketplaces like Jumia are transforming product delivery in Nigeria by prioritizing affordability and convenience. In Ghana, tech startups are propelling small businesses onto the global stage, while South Africa’s robust fintech ecosystem facilitates cross-border payments. However, one of Africa’s biggest challenges is fragmented cross-border logistics.

This is where logistics providers play a crucial role. Streamlined, digitally driven logistics networks ensure that e-commerce works within and across African borders. Platforms integrating booking, tracking, customs, and last-mile delivery are eliminating common friction points.

Additionally, Africa’s younger population is shaping online retail trends, demanding speed, transparency, and sustainability. As logistics firms evolve, incorporating AI and automated warehouse management will further accelerate sector growth.

Africa as the logistics continent

Africa’s strategic location, booming tech adoption, and growing economy place it at the heart of global supply chain transformation. At DHL Global Forwarding, for example, we see Africa as a region of immense potential and a strategic player in shaping international trade.

Investments in technology, infrastructure, and policy reform—alongside collaborative partnerships—will enable Africa’s logistics sector to unlock its full potential. The pathway is clear: logistics is not merely a trade facilitator; it’s the backbone of Africa’s economic transformation.