Africans are often regarded as big consumers and small producers, even though the continent is rich with natural and human resources. Our capacity to consume in Africa far outweighs our local production level. We can boast of little or no industrialisation.
Instead, we import commodities that we have the capacity of producing locally and outsource challenges to expatriates rather than finding local talents to tackle them. From food to household appliances, to mobile phones, to the clothes we wear- the more we consume, the more we import. Shopping malls/retail stores are standing proudly in city centres in major countries in Africa. Displaying imported goods of all forms. Middle-income earners swipe their debit cards proudly, purchasing items regardless of whether they are at a discount or full price. Thus, the retail boom is gripping the continent and there is no doubt that intelligent investors are acting fast on the opportunity.
According to analysts, consumer spending will reach $1.4 trillion in 2020, from about $860 billion in 2008. A news portal reporting on business and investment trends in Africa, HowWeMadeItInAfrica, recently published a story about how international retailers, such as Wal-Mart, are honing their investment interests on selected countries in Africa. Their target – the continent’s growing middle class. But beyond the glitzy, sparkling malls and high sounding figures of profits and investments, African countries must tread softly. The next generation of Africans are taking hold of the potential of not allowing the opportunity to seize the ownership of the African market pass them by. From starting up different local ventures, to using technology to solve social problems on the continents, young Africans are putting on their thinking caps and tapping into the growing retail and high consumer market, through different innovations in technology.
Twelve years ago, The Economist dubbed Africa “the hopeless continent” because of political instability and war that riddled the second largest continent in the world. Over the past decade, however, Africa’s progress has helped overturn this notion. But Africa’s economy remains unduly dependent on the resource sector. The continent clearly needs more indigenous inventions. The next generation of Africans have the DNA (brains and tools) to champion the indigenous innovations in Africa. They can enable Africa stay ahead of the predicted economic curve, be self-reliant, use locally made products to meet local needs and keep the continent’s resources within the continent while fostering sustainable development. The need to create an enabling environment to encourage these local innovations cannot be over emphasized. More indigenous innovations could also open new doors of opportunity that will foster trades across borders.
Young Africans are treading the forefront of innovations; they are risk-takers, tech savvy, well informed and able to rise above oppressive conditions to venture out with their ideas. Global Press Institute recently reported on how young people in Rwanda are embracing technology to foster entrepreneurship. This can be said of other African countries- from East, West, South, North and Central Africa- young people are innovating.
The major challenge often encountered by young entrepreneurs and innovators is funding, or rather, the lack of it. How can we combat this? Here are my thoughts:
1. Political Stability: Innovation cannot be boosted on a continent without a stable political system. Some African countries are still “ruled” by tightly wedged-in leaders and dictators while some others practice a fragile democracy continuously in danger of ethno-religious conflagration. African leaders need to work in tandem to create stable systems that promote peaceful co-existence among its citizens. Other countries should replicate successful African democracy and practice. Africans on their part should realise audacious development aspirations cannot be achieved without peaceful co-existence. With a stable political structure, foreign experts and Africans in Diaspora with the right skill-set will feel more secure to return home and contribute their quota in boosting local innovations.
2. Government Funding: The primary role of the government providing financial support to SMEs in Africa cannot be over emphasized. The governments need to increase their funding opportunities through accessible loans and grants, beyond the minute efforts currently being provided across board. Corruption hindering access to these funding opportunities also needs to be eradicated.
3. Private Investors: African Angel Investors and venture capitalists are not as popular as in Western countries. Perhaps, the billionaires in Africa can find a common ground to provide mutual investment funds for young entrepreneurs. Building the next generation of billionaires should not be left for outsiders. In addition, private investors could also contribute to advancement in research through funding and establish institutions that would encourage more research studies.
4. Collaboration: Young entrepreneurs should cultivate the habit of collaborating and co-creating. There is more advantage in pulling resources together to achieve a similar goal than running in parallel and struggling with funding. In addition, partnership links with local and foreign experts should be encouraged. The same energy and more, used in importing foreign consumable goods should be channelled towards transfer of skills between expatriates and indigenous talents.
5. Savings: Young entrepreneurs currently working full time should cultivate the habit of saving some of their income for the raining days when they venture out to establish their business ideas. Avoid eating with two hands when you can save more for the future.
In spite of the current lack and challenges on African soil, there are many remarkable innovations on the record. An example is the recent launch of a Tablet device, Vantium v1. A Nigeria-based technology company, Websoft, created the Vantium V1, and inn an interview, the CEO, John Dunmoye, said it took about two years to bring the device to light. But now that it is here, they hope it will boost the tablet market in Africa, which is currently dominated by Samsung and Apple products.
Today, the number of mobile subscribers in Africa is estimated as above 500 million, according to Mobile Africa Report. The hopeless continent is now regarded as a developing frontier for global economy with several countries on the continent amongst the fastest growing economies in the world. However, there are still some challenges to tackle. There is still a high rate of unemployment. Also, political instability and fragile democracies are good enough reasons to be cautious. Thus, critics warn against euphoric confidence on fastest growing economies tag. But this must not overshadow the hope in maximizing the current status quo.
Kingsley Ighobor, quoting Ernst & Young, a US-based business consulting company writes on HowWeMadeItInAfrica: “There is a new story emerging out of Africa: a story of growth, progress, potential and profitability…Africa represents the next global economic frontier.” Africans must not fold their arms and watch others benefit from the economy boom, without them acting upon the opportunity to be more inventive.