The turnaround of Africa economy gets a lot of attention
Tag: Africa economy, Africa economy attention
Summary: The turnaround of Africa's economy gets a lot of attention. Yet, despite a gradual evolution in thinking, many investors and philanthropists still miss two important points about how and why Africa …
The turnaround of Africa's economy gets a lot of attention. Yet, despite a gradual evolution in thinking, many investors and philanthropists still miss two important points about how and why Africa is succeeding.
African-led entrepreneurship is growing rapidly and needs to be encouraged further; and long-term capital commitments that build economic prosperity and social wealth should not be a niche asset class—they should be the heart of all investing in Africa.
I have called this development approach "Africapitalism," and its adoption as the driving force of African development is an urgent matter, not just for Africa, but for the world.
Africa's workforce will soon be the largest in the world. According to McKinsey & Company, by 2040, Africa will be home to one in five of the planet's young people and a working population of 1.1 billion people. Many believe this "demographic dividend" can fuel Africa's economic competitiveness, but it could also pose a huge global burden if that potential is squandered.
In agriculture, Africa has substantial underutilized arable land. Yet we are a net food importer with chronic food security issues.
Rather than looking to charity for solutions, we should see this as an opportunity for African-led entrepreneurship to solve problems.
For this reason, Transnational Corporation of Nigeria recently commissioned a fruit juice concentrate processing plant in Benue State, Nigeria, where previously 60% of the fruit crop rotted on the ground for lack of storage and processing capacity.
Such downstream private sector investment can create employment, boost farmers' productivity and profitability, conserve foreign exchange, provide food security, and open new consumer markets domestically.
These cases demonstrate, as do many others, that Africans know where development is needed and can take the lead in executing on those goals.
For their part, African governments are helping by stepping aside and letting entrepreneurs do their beneficial work, with governments doing the work that only they can do: providing a stable, transparent, fair environment in which businesses can thrive.