As African economies boom and businesses are created, one of the big questions this growth raises is that of third-level education: how can Africa develop a knowledge infrastructure to rival that of the west, a sort of Harvard University in Africa? And what should African philanthropists do to foster the development of top quality educational institutions?
There are two main elements to a knowledge infrastructure across a continent or country: firstly, the actual buildings and practical resources; and second, the soft component, such as knowledge and people, the students who go abroad and then return. Both need investment, and now is the time for Africans to invest.
I recently wrote about foreign direct investment in Africa and the prospect of engagement among developing nations and the BRICS. But in order for sustainable development to be achieved across the continent, smart input from Africa’s own entrepreneurs and institutions must also occur. The question of intra-regional African investment is therefore a large one — and an increasingly urgent one.
Africa’s informal economy is one of the most innovative and inventive environments in the world. Yet it is an environment with little regulation in which workers are often exposed to hard conditions and live without a safety net. Technological advances mean that with a mobile phone, an African can start his own business: this makes for a fertile environment for breeding entrepreneurs and launching SMEs, but one that does not benefit the wider economy as much as it could. How can Africa create a balance between these opposing forces? This was one of the main topics of conversation when I attended the recent BRICS summit in Durban.
I spent the past two days in Durban, where I attended the fifth BRICS summit. One of the most notable things about the conference was the prominent African presence there. 15 African heads of state were invited including leaders from Angola, Republic of Congo, Egypt, Guinea, Ivory Coast, Senegal, Chad, to name few.
I suggest that when we talk of the key emerging regions in the world, we should use the acronym BRICA instead of BRICS. The entire African continent is emerging, and many countries are growing at twice the rate of South Africa, where the economy grew by just 2.5 percent in 2012. In contrast, other countries like Ghana or Equatorial Guinea, or Nigeria or even the Republic of Congo, are growing at a much faster rate of 6 or even 7 percent.
I am writing this from the BRICS summit in Durban, where it is clear that the huge momentum of these emerging markets – especially when it comes to their relationship with Africa – is not slowing down. Over the last few days, I have spoken with heads of business and heads of states: it’s clear that while countries like Turkey and Indonesia (including the $23.8 billion Airbus order last week) are flexing their financial muscle, there is still much more investment in Africa to come from BRICS.
The investment isn’t just coming in infrastructure and mega projects. In Africa, middle class consumers now constitute more than a third of the population and the number of households with disposable incomes is projected to grow by 50 percent within ten years. Not only is Africa rich in natural resources; its people – young and growing more affluent – are becoming a powerful economic force.
It’s no secret that Africa has become a major success story. In 2012, six of the world’s 10 fastest-growing economies were in sub-Saharan Africa, and this trend shows no signs of slowing. In 2012, growth hit 5.3 percent and it is predicted to increase this year. Meanwhile technology is transforming the continent. With 650 million subscribers, Africa’s mobile phone market now exceeds that of the U.S. or EU — a development that is changing lives. In addition to these startling figures, there is Africa’s young population, which, according to projections, will double over the next four decades.
These findings are a source of enormous excitement but they also require thoughtful consideration. I suggest that in looking to Africa’s future, six principles should govern decision-making in business and policy: independence, investment, incubation, innovation, infrastructure and inspiration — the six ‘I’s.
At the launch of Nigerian President Olusegun Obasanjo’s foundation last month, I had the privilege of moderating a panel with the Presidents of Nigeria, Ghana, Liberia and Benin in front of 1,000 business and political leaders. The former Nigerian head of state and his peers spoke eloquently about the need to educate girls. President Obasanjo stated: “If we educate a girl, we educate a family.” As a result, he has named the education of women and girls as one of his five key initiatives for his new foundation.
But beyond the basic issue of education — which will help families, villages and countries pull themselves out of poverty — women remain the untapped economic superpower. As Africa becomes more and more prosperous, we must ask what role African women will play in this growth.
It is already evident that they are a dynamic and driving force. When it comes to entrepreneurship, women have proved themselves to be highly creative; so effective that a recent New York Times article suggested that “women entrepreneurs drive growth in Africa.”
January is a time not only for New Year’s resolutions but also for predictions – projections of hopes and anxieties about the year ahead. This January, media outlets have been active in offering readings of the crystal ball, and the Economist magazine posed a key question to readers in a debate online: will the world economy be in better shape in 2013 than in 2012?
This question is one on which much will hinge – the years since 2008 have seen plenty of turmoil. According to some experts, however, it appears that the signs are pointing up, and Christine Lagarde, the MD of the IMF, was cautiously optimistic about the global economy’s prospects.
Lagarde suggested that the transformations we have seen – in Europe, Asia, Latin America, Sub-Saharan Africa and elsewhere – would ultimately yield positive results. But she outlined the challenges lying ahead: leaders will need to move beyond the Eurocrisis, establish a stronger global financial system, and facilitate more inclusive routes toward growth. “Achieving these milestones presupposes greater global cooperation,” she explained. “A world that is bound closely together must be a world that works closely together if it is to prosper together.”
One of the most exciting phenomena of the past few years has been the swift and steady rise of the African continent. The region has experienced continuous growth, just as Europe and the US have faltered.
Africa’s rise creates new challenges for businesses, which must quickly educate themselves about its complex markets. This was something that Frank Braeken, executive VP of Unilever Africa, acknowledged in a recent interview. “We are still very much in learning mode about what the differences are within Africa,” he said.
Many outside investors have assumed that Africa’s potential derives mainly from the commodities boom and is primarily relevant, therefore, to oil and mining corporations. But that is far from true. Opportunities exist across retailing, telecommunications, banking, infrastructure and agriculture. Addressing the fact that African consumers have been neglected, Braeken noted: “I like to say that the African consumer has been underestimated, underserved and underserviced.”