Africa Commission Seeks to Create Jobs by Backing Entrepreneurs

[Invisible]

By Peter Heinlein
Addis Ababa
21 November 2008

A group of prominent citizens, led by Tanzania's president, Denmark's prime minister, the deputy secretary general of the United Nations and Africa's top diplomat, is developing a strategy to create new and better jobs for Africa's youth. VOA's Peter Heinlein in Addis Ababa reports the plan borrows liberally from the formula that made the United States the world's economic engine.

The so-called Africa Commission met in the Ethiopian capital Thursday to discuss the proposition that aid is not the answer for Africa - competitiveness is. And that what is needed is not more traditional development programs, but more jobs and opportunities for bright young Africans brimming with ideas and potential.

The commission is led by Danish Prime Minister Anders Fogh Rasmussen. It also includes a number of free-market advocates such as Tanzania's President Jakaya Kikwete, Mohamed Ibn Chambas, President of the West African Economic grouping ECOWAS, African Development Bank President Donald Kaberuka, U.N. Deputy Secretary General Asha Rose Migiro, and African Union Commission Chairman Jean Ping.

Another commission member, philanthropist and good governance crusader Mo Ibrahim, says the commission hopes to form a sort of venture capital fund that will enable bright young African entrepreneurs to realize their dreams, in much the same way American entrepreneurs like Microsoft's Bill Gates did. If done right, he says the project might even make a profit.

"(It's) how the great companies in the United States were started. How Microsoft started. Some guy started it in a garage. A student. But in America the engines, the venture capital industry built the united States, these are the guys who funded the Bill Gates and all those kids who came with all those crazy ideas, and they end up building great companies. Now the venture capital business is not a charity, it's a business."

Prime Minister Rasmussen noted a few startling statistics. Africa's overall unemployment rate is estimated to be 44 percent; even higher among young people. At present, about eight million new jobs are created in Africa each year. Rasmussen says the commission hopes to boost that number to 15 million a year by identifying and financing budding young entrepreneurs who in turn start businesses that create jobs. "Young people are often more venturous than older people. They have fresh ideas, energy and enthusiasm. Yet young people face more constraints in relation to access to risk capital," he said.

Rasmussen says the commission will start small, focusing first on entrepreneurs in African countries with the most business-friendly environments, to ensure the best possible chance that start-up businesses will succeed.

He did not names the countries that might be chosen for the first investments, but the index of good governance released recently by the Mo Ibrahim Foundation rates three small island states, Mauritius, Cape Verde and the Seychelles as the best governed in sub-Saharan Africa. South Africa and Botswana also rated high in the survey.

Countries rated as among the continent's most poorly governed were Somalia, Ibrahim's native Sudan, and the Democratic Republic of Congo.

 

[Masanja]

By Peter Heinlein
Addis Ababa
21 November 2008

A group of prominent citizens, led by Tanzania's president, Denmark's prime minister, the deputy secretary general of the United Nations and Africa's top diplomat, is developing a strategy to create new and better jobs for Africa's youth. VOA's Peter Heinlein in Addis Ababa reports the plan borrows liberally from the formula that made the United States the world's economic engine.

The so-called Africa Commission met in the Ethiopian capital Thursday to discuss the proposition that aid is not the answer for Africa - competitiveness is. And that what is needed is not more traditional development programs, but more jobs and opportunities for bright young Africans brimming with ideas and potential.

The commission is led by Danish Prime Minister Anders Fogh Rasmussen. It also includes a number of free-market advocates such as Tanzania's President Jakaya Kikwete, Mohamed Ibn Chambas, President of the West African Economic grouping ECOWAS, African Development Bank President Donald Kaberuka, U.N. Deputy Secretary General Asha Rose Migiro, and African Union Commission Chairman Jean Ping.

Another commission member, philanthropist and good governance crusader Mo Ibrahim, says the commission hopes to form a sort of venture capital fund that will enable bright young African entrepreneurs to realize their dreams, in much the same way American entrepreneurs like Microsoft's Bill Gates did. If done right, he says the project might even make a profit.

"(It's) how the great companies in the United States were started. How Microsoft started. Some guy started it in a garage. A student. But in America the engines, the venture capital industry built the united States, these are the guys who funded the Bill Gates and all those kids who came with all those crazy ideas, and they end up building great companies. Now the venture capital business is not a charity, it's a business."

Prime Minister Rasmussen noted a few startling statistics. Africa's overall unemployment rate is estimated to be 44 percent; even higher among young people. At present, about eight million new jobs are created in Africa each year. Rasmussen says the commission hopes to boost that number to 15 million a year by identifying and financing budding young entrepreneurs who in turn start businesses that create jobs. "Young people are often more venturous than older people. They have fresh ideas, energy and enthusiasm. Yet young people face more constraints in relation to access to risk capital," he said.

Rasmussen says the commission will start small, focusing first on entrepreneurs in African countries with the most business-friendly environments, to ensure the best possible chance that start-up businesses will succeed.

He did not names the countries that might be chosen for the first investments, but the index of good governance released recently by the Mo Ibrahim Foundation rates three small island states, Mauritius, Cape Verde and the Seychelles as the best governed in sub-Saharan Africa. South Africa and Botswana also rated high in the survey.

Countries rated as among the continent's most poorly governed were Somalia, Ibrahim's native Sudan, and the Democratic Republic of Congo.

This is an excellent initiative. I support it. In anyway Africa has never been short of ideas. The line up is equally impressive.

My concern is-AND ALWAYS WILL BE..Africa we need to adress governance and corruption problems. Without taking the bull by its horns hatuwezi kwenda popote. We need rule of law and great investment in human capital. For example if you deal with corruption squarely, its possible to see the dividends in terms of social service delivery, relatively less cumbersome procedures for investiments and registration of various business (LOCAL AND FOREIGN). People who sign crooked contracts should be taken to the Gallow! Yes. And this is the whole of Africa...We should use our resources creatively..Without adressing governance problems the Kibakis and Mugabes of this continent will haunt us for years to come!

For example we spend millions to attract tourists. Excellent initiative but equally misguided. If you invest in social infrastructure like hospitals, clean water, good roads, human security among others. tourists will always come. Because they know their security and comfort is guaranteed. You kill two birds by one stone (God bless the bird). Sasa hivi mtalii anakuja lakini lazima ajiandae, apewe tahadhali kuhusu uchafu wamji kama Dar, aambiwe kwamba hospital ni mpaka Nairobi au SA etc, , asinywe maji, asitembee pekee yake..and on and on... Why not got to spend your hard earned cash somewhere in Paris and London and see the wonders of human ingenuity? or go to Asia........huyo mtalii unafikiri anatupenda kiasi gani kuchukua hiyo risk? Think about it!

Again, this is an excellent move, but we have to do it on a sustained basis and be prepared to self evaluate ourselves.

Grand Corruption, Rule of man and bad/autocratic/dictatorial governance is the biggest challenge of our time. We have to stand up, if we really want to "go big".