Africa is a continent of the young, presenting great opportunity for sustainable development, says a new UN report
Strong economic growth in Africa over the past decade has not led to prosperity for all. A new UN Development Programme report, Realizing Africa’s Wealth – Building Inclusive Businesses for Shared Prosperity, says that involving low-income communities in markets and businesses across Africa is essential to translate economic growth into sustainable development.
The population of sub-Saharan Africa is about 800 million. By 2015, 75% of the population will be below the age of 30, and the number of young people is expected to double by 2045.
“This young, growing population holds great economic potential,” says Gerd Trogemann, manager of the UNDP regional service centre for eastern and southern Africa. “Household incomes are rising and consumer spending is expected to grow to $1.4tn by 2020, $520bn more than in 2008.”
Drawing on 43 in-depth case studies from 16 sub-Saharan African countries and a database of 600 support institutions, the report looks at the various elements required to make economic growth more inclusive and to bring it closer to low-income communities, focusing on how businesses can better connect with them.
“Inclusive business provides opportunities for mutual benefit,” Trogemann says. “The framework presented in the report calls for a support ecosystem for inclusive businesses with four dimensions: information, incentives, implementation support and investments. This will increase opportunities for all Africans to become entrepreneurs, consumers, employees or producers.”
Many companies have made inclusive business work, tapping into the economic advantages that the region has to offer and benefiting low-income groups at the same time. One such example is in Burkina Faso, where the French cosmetics company L’Occitane en Provence provided opportunities for 15,000 women to produce and export quality shea butter, through investing in building the capacity of local women’s co-operatives. This generated $1.2m in profits for the local women’s cooperatives in 2012.
There is an increasing awareness of the benefits that Africa has to offer, with an understanding that it must be coupled with investment in its people. “We recognise the challenges in trying to strengthen and support the supply chain in Africa, one of the UK’s most important value chains, particularly around the issues affecting young people,” says David Croft, director of food technology for UK retailer Waitrose.
However, significant problems remain, including extreme poverty, hunger, disease and unemployment. Development will only remain on track if these issues are addressed.
“Inclusive business is by no means a silver bullet, and requires significant investments in time and research,” says Geoffrey Dennis, chief executive of anti-poverty NGO Care International UK. “But by broadening the range of actors involved, important progress can be made to alleviate poverty and exclusion.”
Dennis says eradicating extreme poverty is a “complex challenge that requires long-term, systemic interventions”. He adds: “The Millennium Development Goals created a new international architecture and built global alliances to support systemic change and deliver on development objectives. But, the world has transformed since 2000, and new models are required to make further progress on the MDGs and expand opportunity and growth.”
Given the potential of the young and growing population in Africa and increasing political stability, there are many opportunities on the continent. “These young people have the opportunity to become the drivers of inclusive business,” says Trogemann.Claire Manuel opportunity Sustainability news sustainable development
October 2013, London, UK
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