Coke to invest more in Africa
Company wants to stake claim in out-of-the-way markets to spur growth


The Atlanta Journal-Constitution
Published on: 08/01/08

Washington — Coca-Cola Co. plans to expand locally run distribution centers in Africa by up to 2,000 over the next three years, an effort executives say would help the company secure hard-to-reach markets while helping to spur job growth on a continent historically perceived as being too poor and unstable to do business in.

The plan comes as African leaders stress their desire to lure foreign investment from the private sector.

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"Yes, we appreciate the philanthropy . . . but we want to be able to stand on our own two feet," said Uhuru Kenyatta, Kenya's deputy prime minister and minister of trade.

Kenyatta, who spoke recently at the seventh annual African Growth and Opportunity Act Private Sector Forum in Washington, said the continent is willing and ready to partner with private corporations. The trade minister thanked Motorola and Coca-Cola, which hosted the July 16 event, for their interest in the continent.

"Africa is there for you, and we are ready to do business with you," Kenyatta said.

Coca-Cola plans to launch up to 2,000 manual distribution centers by 2010 in Nigeria, Mozambique and Morocco.

The initiative allows independent local entrepreneurs to set up and run distribution centers for Coke beverages on the company's behalf.

The centers are typically located in rural or remote areas where the lack of good roads and infrastructure makes it difficult for delivery trucks to reach.

Those who set up centers employ others in the area who sell and distribute the popular soft drink, often by bicycle.

"Everybody makes money," said William Asiko, president of the Coca-Cola Africa Foundation.

The company launched the initiative about six years ago, and more than 3,000 centers already exist, mostly in East Africa, Asiko said.

The goal of the expansion is to create between 5,300 to 8,400 jobs. It projects that it will pump $320 million to $520 million into local economies, company representatives say.

Coca-Cola, headquartered in Atlanta, has operated in Africa since 1928. It is one of the continent's largest employers.

"Coke is putting the seeds toward economic development, at least at the very, very basic local level," said Sam Cherribi, director of Emory University's Emory Development Institute, which researches and promotes economic development in low-income countries.

While Cherribi acknowledged criticisms that Coke does little nutritional good in Africa by promoting the sugary drink, he noted that the company offers other meaningful initiatives to help countries improve health care, water sanitation and public infrastructure.

Critics "might say they are sucking the blood of people, but in the big picture it's much more positive than corrupt governments," he said.

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