Africa needs to rethink the future | Capital For Purpose.
My insights towards the theme “Capital For Purpose” of the 49th St. Gallen Symposium. I’m honored and humbled to be attending the Symposium this year.
New York City added roughly 4 million residents in the past 100 years. Dar es Salaam will add 21 million over a similar span. Oops, they will need to eat. Can urban farming be the solution? How do we create decent jobs for all these people? Can technology fix this? By the way, Tanzania is among the most youthful countries in the world, more than 44 percent of our current population is under the age of 15. Africa needs to speak the future. The youthful population can be an opportunity or a curse, the strategy controls it all.
Impact Investing, Angel Investing, Venture Capital, it doesn’t matter what it matters is where is it being directed. Africa wants more transactions to happen than aid. Money channeled to where it matters most, the future. Technology has never been a solution it’s just a tool. The digital transformation will never make sense if it doesn’t include 63 percent of Sub-Saharans who lives in rural Africa. Or if it excludes women who make up 40% of the global workforce. The top five countries with the highest female representation in the workforce are all in sub-Saharan Africa. Promoting gender equity becomes a necessity. A true digital transformation means tech that enhances; quality education for all, universal access to health services, food security and improving the overall people livelihood.
Future is driven by trends and complex systems. We can not afford to work in silos. You can’t fix interconnected global problems by working alone. Creating pathways to prosperity is a connection of dots based on; trust, respect and business models that create value to everyone. Most importantly, models that allow us to wake up tomorrow and consume clean air and healthy food. Protecting our environment is key, climate change is not a myth. Can we invest in industries without smokestacks to address Africa’s youth unemployment crisis? The growing population of more educated and urbanized youth encountering few jobs is cancer. A sector like tourism and horticulture plays a critical role in addressing the issue. In Tanzania, tourism accounts for approximately 14 percent of GDP, and about 3.2 percent of total employment. What will happen if we invest more?
Successful investment is a function of three variables; people, product and processes. While we know where we want to invest in, the product. Leadership is vital, this relates directly with people; the right people in the leadership positions who respect the rule of law and citizens with relevant skills and talents. This is the best time to invest in “Future Skills” and “Urban Skills”, Africa is getting urbanized like never before. Social Media Strategist makes more money than an average entrance level public employee, that is urban skills. Should we invest more on college degrees or to relevant skills that can quickly be transformed into cash? A young person who sells music along Kariakoo street in Dar using his phone or a computer graduate moving around with a brown envelope looking for a job. What is our priority? Where would we create more impact?
Africa is a market, 1.2 billion people, look at them as potential consumers. Consumers that will be around years to come. The middle class is growing and the purchasing power of people is going up. As people become more exposed and educated they start to appreciate quality and technology. It comes with opportunities and challenges; Sub-Saharan Africa will need to create 18 million jobs each year. We don’t have the luxury of investing in areas that don’t matter. We need to invest for purpose but before that, we need to rethink the future.