Why Africa is missing among the world's top innovators - CNBC Africa

Why Africa is missing among the world's top innovators


by David S. Levin* 0

Photo: Wikimedia

I saw a beautiful, multi-coloured map the other day of the “Fifty Most Innovative Economies” in the World. It was really quite impressive. North America, Asia, Western Europe, Russia and Australia were all shaded in a dark, steely blue indicating they were among the world’s top innovators.

They all excelled in any number of sectors from manufacturing, medicine, aerospace and pharmaceuticals to architecture, farming, automobiles and technology among others… and the list goes on.

Then I looked at Africa… It was as if it wasn’t even there.

As someone who has worked with African companies every day for nearly two decades I have to tell you this really bothered me.

And I suppose, as you are reading this, it probably troubles you too.

In relation to the rest of the world, Africa had essentially added nothing with the very minor exceptions of Morocco and Tunisia which were both shaded in a barely perceptible light blue.

How can this possibly be? And how can there be no contribution from sub-Saharan Africa which contains two of the three largest economies on the continent as measured by GDP?

So from the standpoint of innovation - and by extension - contribution to the greater global good Africa wasn’t even on the map (pardon the pun).

Let’s face it. This speaks volumes.

Of course, theories abound with respect to what plagues Africa – and there are plenty to choose from. I know what you’re thinking. Poverty, corruption, electricity, food security, African strongmen, water, sanitation, land, terrorism, etc.

And you’re all correct.

Unfortunately, these rationalisations all contribute to the distasteful reality that Africa is an emerging market that has, well… never quite emerged. It’s stuck in the mud.

Let’s look at some of the more popular reasons why:

Poverty? It’s at unimaginable levels. 17 of the world’s 20 poorest countries are located in Africa. How’s that for starters?

Food Shortages? 36 million people face hunger across Southern and Eastern Africa. In Ethiopia alone, over 10 million people require emergency food assistance to meet their basic food needs, and some 458,000 children are estimated to suffer from severe acute malnutrition according to the UN.

Lack of Reliable Power? Well, it’s hard to do things in the dark isn’t it? And you can’t manufacture your products, use your computer, wash your clothes or turn on the TV if nothing actually works because there is no power. The World Bank says that 32 countries there are in an “energy crisis.”

Dictatorships? Strongmen are everywhere in Africa. Like Zimbabwe’s Mugabe, Equatorial Guinea’s Mbasogo, and Angola’s dos Santos to name a few. All have been in power for over 30 years. And this one will take a generation – maybe two - to produce a completely different mind-set toward politics, power, people and fairness. Unfortunately, Africa is still the world leader in this authoritarian phenomenon.

Corruption? A stage 4 cancer that is rampant in many African countries. Nothing gets done unless palms are greased.

Food, Water and Land? These are all nothing but trouble. Simply stated, there’s already not enough food there and roughly half of Africa’s land is considered to be “too damaged” for food production. This has sharply diminished agricultural production of most of Africa’s staples like maize and bananas and has increased food prices dramatically. And while we’re at it, we can thank El Niño for leveling Southern and Eastern Africa with the worst drought in 50 years.

Big problems that all need to be addressed for sure. And it won’t be easy. There’s not exactly a large margin for error here.

So with all that said, I think one very important clarification needs to be made: The above issues are the symptoms. Not the disease.

They are the result.

But I know what the disease is and I’m pretty sure I know how to treat it.

Unfortunately, most of us won’t be around to witness much of this as the cure will likely take a generation or two to bear fruit.

So I suppose what I am going to suggest is what they call “paying it forward.”

And it is the best gift Africa can give to its children and their children’s children and so on…

No, it’s not power or food. Nor is it the ousting of Africa’s corrupt leaders either. All of that has to be resolved too.

But what I am suggesting goes much, much deeper and lays the foundation for virtually everything of any value in any truly robust, dynamic society.

It’s the “long money” as they say in Las Vegas…

And here’s the answer: Education.

That’s right. Education.

Well, if you’re disappointed in my answer, and to put things in perspective, then consider this statistic. Africa’s under 18 year old population will swell to nearly 1 billion by 2050 according to the Unicef. That’s a lot of children.

So here’s the question. What are they all going to do when they grow up?

I think it’s time for a new game plan.

So here’s the bottom line: Education is the absolute unchallenged, global difference maker and the correlation between it and a fully functioning, innovative society is undeniable. In essence, it’s what defines - and divides - great countries from ones that perpetually struggle.

Knowledge underpins and forms the basis for everything.

And education is the delivery system.

Just look at history if you want proof. Start with the Greeks and their contribution to just about everything from math and science to philosophy, art and architecture. They were pretty ahead of the educational curve for a few centuries wouldn’t you say? And how about the Italians and that wild and carefree period of enlightenment called the Renaissance? The pursuit of knowledge to the Italians was a core societal standard. It’s what you did.

It’s all about learning, folks.

Without it, all that’s left is hope and a handful of limited options. And that’s just not enough.

Africa does, of course, have several pockets of relative success. According to a recent UNESCO report, Sub-Saharan Africa spends 5% of its GDP on education coming in just behind Europe and North America, both at 5.3%. Countries like South Africa, Zimbabwe (despite Mugabe), and Nigeria all have reasonable levels of schooling.

But there are 51 other countries on the continent - and many of them don’t.

Quite frankly, many of them are not even close. Countries like Gambia, Eritrea and Mali suffer from a profound lack of basic resources and scholastic materials like books, computers, pencils, paper, desks and chairs.

There are excessively large class sizes, insulting levels of gender inequality, poor training for teachers, and little to no access to internet broadband in many areas. To sum it up, Africa currently has more than 40 million children that are not in school according to UNESCO.

Primary school enrolment in Africa is among the lowest in the world.

So with this I offer my thesis - as simple as it may be: Without a highly functioning, primary school through university, culturally inclusive, gender equal, technology driven educational system it will be nearly impossible for any country in Africa to develop a legitimately regarded, self-sustaining private sector (that’s a mouthful). One that can create, innovate and contribute to the greater global good.

In short, if things stay as they are, “Africa Rising” will sadly remain yet another unfinished narrative.

Or, to put it more simply, if my thesis was expressed as an equation it would look something like this: No education = no skills. No skills = no industry. No industry = no jobs. No jobs = no money.

You get the idea.

So what’s left? Well, mining and farming. Are these important? Absolutely. But after you harvest a few hectares of crops and extract a few tons of copper and gold out of the mines then what happens?

So here’s the plan. If things are going to change, Africa needs to begin the slow transition from the manual labour based, agrarian and mining driven ecosystem of today to one largely built around a broadly skilled and educated workforce. So in addition to mining and farming, a more robust economy can begin to develop in sectors like manufacturing, technology, food, clothing, pharmaceuticals, transportation, consumer goods, and retail among others.

It simply has to happen.

Essentially, educating the broader population is the spark that will ignite a larger flame. And as far as I can see, this is the only way Africa is ever going to “rise”.

China did it.

They used rigid schooling and skills based training to kick-start their rapid ascension toward becoming an economic superpower.

With the beginning of the post-Mao era in 1976, China transformed itself from a largely rural, agrarian, Stalin inspired, centrally-planned, communist state into the world’s 2nd largest economy clocking in at over $10 trillion and it did this all in under 40 years. Wow.

No more excuses now. Someone else just did it.

And it’s going to take unbelievably massive amounts of never-ending capital to pull this off. The whole thing may even have to be implemented through a giant, centralised, continent driven initiative delivered through some kind of an African governing body (like the African Union) not dissimilar from how the European Union is managed out of Brussels.

And here’s a thought. Why not use some of those billions of dollars of state revenues from oil and other natural resources (thank you China, come back soon) to provide the base funding for this?

But I’m not going to sit here and suggest exhaustive thesis-driven solutions and complex business models for remedying this. There are many people out there who are much smarter and better suited for this than me.

I’m talking about the choice. The catalyst. And if Africa doesn’t make the choice to do this for themselves, who will?

It’s the first step. It’s the decision by all Africans - as a people – to begin to think differently than their predecessors did. To make education matter. To make education what you do. To lay the foundation for their children.

But this will take at least one generation to achieve this. Maybe two. This is a paradigm shift. And it won’t benefit the people living in Africa today. It’s largely for people who are not even born yet. It’s a gift for future generations of Africans. It’s the proverbial “ticket” out of despair - and into prosperity - for them.

They just have to make the choice.

Otherwise, it will be another lost era. And Africa can’t afford that.

So I’ll leave it at this: A properly educated and skilled workforce is the only thing that can take the African people beyond mining and agriculture to the point at which they can be competitive on the world stage. The direct correlation between educational levels and highly functioning economies is clear.

Look at some of the countries who have consistently ranked among the most effective educational systems in the world; Japan, Canada, Hong Kong, the U.S., China, South Korea, Sweden, Israel, Singapore, Germany, Switzerland and Finland.

Then look at the strength of their economies. See the connection?

Global leaders in one form or another. All of them.

Right now, Africa is dying a “death of a thousand cuts”. As much as I hate to say it, many of them are self-inflicted. But start to treat the actual disease and recognise the symptoms for what they are.

Decide to change.

Commit to education as the only serious, long-term solution truly capable of delivering Africa’s future generations to the developed world - but this time as participants, not dependents.

Give the children there the chance to do better than their parent’s generation did - as well as all the generations that came before them.

And take comfort in the fact that you are ultimately putting Africa in a much better place than it is today.

Pay it forward Africa…you owe it to your children.

*David S. Levin is a Managing Partner at Nexus Capital Markets, LLC, micro-blogging on all things Africa. A New York investor’s view of Africa and other emerging economies. Nexus Capital Markets is a leading Pan-African/U.S. investment bank located in NY and JHB.