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Film stars, musicians and sports stars from across Africa are global celebrities. South African actresses like Terry Pheto <a href="https://www.theguardian.com/culture/2006/mar/17/2">win international awards</a>; Nigerian rapper <a href="http://www.theo2.co.uk/events/detail/wizkid">Whizkid sells out concerts</a> across the UK; and Didier Drogba, Cote d’Ivoire’s all-time top goal scorer, is now looking to <a href="http://www.espnfc.com/major-league-soccer/19/blog/post/3106282/signing-drogba-delivers-exposure-to-phoenix-rising-mls-expansion-bid">build a soccer empire in the US</a>.
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When it comes to governance across the continent, however, the headlines can be less encouraging. In the last few weeks alone, we have seen evidence of corruption and lack of transparency in several African nations, while huge anti-corruption rallies have been taking place.
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Naming and shaming those involved in corruption is important; laws must be enforced and rule-breakers must be punished. This is an essential part of the process of governance and efforts to build trust between those in power and citizens.
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But we should also be “naming and faming” those leaders with integrity – across governments, companies and civil society – in the same way we celebrate the best rappers or footballers. After all, these are the unsung heroes that are literally saving lives – making sure that health budgets are spent effectively, guaranteeing respect for workers&#8217; rights or going that extra mile to ensure all voices are heard as part of development programs.
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So we decided we would scour the continent, not to highlight the wrongdoers, but to celebrate the do-gooders, who are working with integrity and accountability to transform their countries. Here are five great examples:
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1. <a href="https://www.nytimes.com/2015/06/21/magazine/can-thulisile-madonsela-save-south-africa-from-itself.html">Thuli Masondela</a>
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A human rights lawyer and South Africa’s first female public protector, she helped to draft South Africa’s constitution and has been working to protect it ever since. Masondela has fiercely investigated everything from kickbacks to political parties, the abuse of power, and the misuse of public funds. Now, Masondela has <a href="http://www.leadsa.co.za/articles/239370/adv-thuli-madonsela-to-launch-foundation">set up a foundation</a> to focus on democratic and ethical leadership.
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2. <a href="http://www.iwacu-burundi.org/englishnews/impunity-fosters-corruption-in-burundi-watchdog-says/">Faustin Ndikumana</a>
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A Burundian anti-corruption activist, leader of a civil society watchdog group and former prisoner of conscience. Ndikumana has worked for many years to fight money laundering, illicit financial flows and bribery in Burundi, using channels including the church and universities to advocate for change. In 2012, Ndikumana spent time in jail after exposing corruption within the Burundian judicial system.
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3. <a href="http://www.pbs.org/frontlineworld/stories/bribe/2010/01/nuhu-ribadu-nigerias-relentless-corruption-hunter.html">Nuhu Ribadu</a>
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A former Nigerian policeman, now in exile in the US, who led the fight against corruption through Nigeria’s Economic and Financial Crimes Commission between 2003 to 2007. Ribadu took on over 1,000 high-profile cases which included the <a href="http://edition.cnn.com/2010/WORLD/africa/12/21/nigeria.halliburton/">successful prosecution of Halliburton</a> under the Foreign Corrupt Practices Act and the investigation of the Inspector General of the Nigerian police, his own boss.
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4. <a href="http://www.cjfe.org/mae_azango_accepts_2012_international_press_freedom_award">Mae Azongo</a>
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A pioneering Liberian journalist with the Front Page Africa newspaper and winner of the International Press Freedom Award in 2012. Azongo has investigated everything from illegal mining; to working conditions on development projects; to female genital mutilation, which at one point forced her into hiding. During the Ebola outbreak, Azongo worked to expose the ways in which <a href="http://www.aljazeera.com/programmes/africainvestigates/2014/11/liberia-living-with-ebola-20141110114418589681.html">corruption was undermining the response to the crisis</a>.
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5. <a href="https://www.ted.com/talks/patrick_awuah_on_educating_leaders">Patrick Awuah</a>
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A Ghanaian educator, who after working for Microsoft for almost a decade in the US, returned home to found the widely-lauded Asheshi University. The university offers a core curriculum with a deep focus on ethical leadership, including honour codes for students to build accountability. Awuah understands that building integrity among young people is a critical generational bulwark against corruption.
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<figure class="st__content-block st__content-block--image"><img decoding="async" src="https://assets.weforum.org/editor/HWoHq1l-DLYXOTmYwBHVwBbUK_9vYkGDT9mglDDwMtg.jpg" alt=" " />
<div class="image__credit">Image: Transparency International/Statista</div>
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There are existing efforts that use this positive approach to support reformers: the Ibrahim Prize for African Governance, for example, which rewards honest heads of state; and at the <a href="http://www.accountabilitylab.org/">Accountability Lab</a> we run a TV program called <a href="http://www.integrityidol.org/">Integrity Idol</a> in <a href="http://www.integrityidol.org/liberia">Liberia</a>, <a href="http://www.integrityidol.org/mali">Mali</a> and elsewhere to find, film and popularize honest local level officials.
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Celebrating do-gooders does not replace the prosecution of wrongdoers. But it does give citizens everywhere hope that there are people out there serving the public good, even in the most difficult of circumstances. Imagine if we all came together to collectively show them how much we appreciate what they do; now that would be something worth cheering about.
<a href="https://www.weforum.org/events/world-economic-forum-on-africa-2017">This article is part of the World Economic Forum on Africa 2017</a> and is republished with its permission
</div>

These five leaders are exposing corruption and bringing hope to Africa

DURBAN, South Africa, May 4, 2017—Without urgent action to address stagnating levels of competitiveness, Africa’s economies will not create enough jobs for the young people entering the job market, according to a report released today. If current policies remain unchanged, fewer than one-quarter of the 450 million new jobs needed in Africa in the next 20 years will be created.
These are among the key findings of the Africa Competitiveness Report 2017, a biennial publication jointly produced by the World Economic Forum, the African Development Bank, and the World Bank Group.
Priorities to meet the changing demographics include policy reforms to improve the quality of institutions, infrastructure, skills and adoption of new technology. House construction and better urban planning present opportunities for short-term competitiveness gains.
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The report finds that the ability of Africa’s economies to generate enough jobs for its young and growing population rests on the successful implementation of urgent reforms to boost productivity. Competitiveness is defined as the set of institutions, policies and factors that determine the level of productivity—and hence future prosperity—of a country. The report, which covers North Africa and Sub-Saharan Africa, comes at a time when growth in most of the region’s economies has been slowing after a decade of sustained growth. Further stagnation is likely in the absence of improvements in the core conditions for competitiveness.
Compounding the challenge to Africa’s leaders is a rapidly expanding population, which is expected to add 450 million more to the labor force over the next two decades. Under current policies, only 100 million new jobs would be created during this period, according to the report.
Africa’s young, dynamic population does, however, possess the potential to lead an economic revival in the region backed by targeted short- and long-term reforms in key areas, the report finds. Priority action areas for improved competitiveness are:
Short term:
<ul>
<li>Prioritizing sector-specific reforms in labor-intensive sectors such as agribusiness, construction, and micro-enterprises can stimulate near-term job creation.</li>
<li>Targeted support can address acute economic issues for vulnerable regions and populations in fragile countries.</li>
<li>Open trade policies can help foster regional economic integration.</li>
<li>Developing value chain links to extractive sectors will encourage economic diversification in resource-rich countries.</li>
<li>Increased housing construction through investment, better urban planning, and less red tape will create jobs and address severe shortages of housing stock.</li>
</ul>
Long term:
<ul>
<li>Strengthening institutions is a pre-condition to enable faster and more effective policy implementation. Failure of implementation in the past has often been attributed to weak institutions.</li>
<li>Improved infrastructure is needed to enable greater levels of trade and foster businesses growth.</li>
<li>Greater adoption of technology will be critical to boosting lagging productivity.</li>
<li>Developing the right skills will help Africa remain competitive in a rapidly changing global economic landscape.</li>
</ul>
“Removing the hurdles that prevent Africa from fulfilling its competitiveness potential is the first step required to achieve more sustained economic progress and shared prosperity,” said the World Economic Forum’s Richard Samans, Managing Director Centre for the Global Agenda.
“To meet the aspirations of their growing youth populations, African governments are well advised to enact polices that improve levels of productivity and the business environment for trade and investment,” said the World Bank Group’s Klaus Tilmes, Director of the Trade &amp; Competitiveness Global Practice, which contributed to the report. “The World Bank Group is helping governments and the private sector across Africa take the steps necessary to build strong economies and accelerate job creation in order to benefit from the potential demographic dividend.”
“African cities have to update their urban plans, taking into account demographic and economic developments in the last decades. This is crucial to address the shortage of urban infrastructure and availability of land for residential housing. This is important as a massive investment is needed for the continent to lower the housing backlog, thereby improving the lives of urban residents, and to create employment for the youth,” said African Development Bank’s Abebe Shimeles, Acting Director of Macroeconomic Policy, Forecasting and Research Department. “In its new business delivery model, the Bank has created a unit to specifically focus on cities and urban infrastructure.”
The Africa Competitiveness Report combines data from the Forum’s Global Competitiveness Index (GCI) with studies on employment policies and city competitiveness. Also included in the report are detailed competitiveness profiles of 35 African economies. The profiles provide a comprehensive summary of the drivers of competitiveness in each of the countries covered by the report, and are used by policy-makers, business strategists and other key stakeholders, as well as those with an interest in the region.
Click here to read the <a href="http://documents.worldbank.org/curated/en/733321493793700840/The-Africa-competitiveness-report-2017-Addressing-Africa-s-demographic-dividend">full report</a>.

Africa needs to take urgent action to harness its youth dividend

In 1624, the English poet John Donne wrote the famous line: “No man is an island.” His verse conveys the message that no one is self-sufficient; we all rely on others.
As we enter the <a href="https://www.weforum.org/agenda/2016/01/the-fourth-industrial-revolution-what-it-means-and-how-to-respond/">Fourth Industrial Revolution</a>, in which advanced manufacturing and the convergence of new technologies hold the key to economic success – or failure, these words have never seemed so prescient.
A world in flux
The opportunities presented by emerging technology breakthroughs are vast. They have the potential, when combined and connected, to transform our manufacturing and production systems, entire business models, our economic outlook, the future of employment and even our stewardship of the world around us.
The key lies in the words “combined” and “connected”: more than at any other time in our industrial history, deep collaboration across our civic, organizational and national boundaries is needed to unlock the true value that these new production systems offer.
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Unfortunately, the failure to date to combine and connect is having very real consequences. Certain groups and regions within countries feel the global free market system is working against their interests and they are turning to political leaders peddling a return to nationalism and protectionist policies—an “<a href="https://www.atkearney.com/gbpc/thought-leadership/detail/-/asset_publisher/03JmqNRaRZj7/content/from-globalization-to-islandization/10192">islandization</a>” of what was globalization.
On top of the real and perceived political consequences of inequality within key markets, our era is characterized by growing volatility, unpredictability, and geopolitical tensions. This swing towards divergent economic approaches has slowed cross-border movement of goods, services, capital and people.
Another influencing factor is the extent to which economies around the globe have been able to industrialize. Those that have had the capacity to translate scientific discovery into technological innovation are arguably going to be quicker off the starting blocks. Others may find themselves having to look for opportunities to bypass traditional routes to development.
Clearly, different countries and regions will need their own unique strategies to take advantage of this new future of production in an increasingly “islandized” world – that is, one less friendly to global trade, and far less favourable to new entrants on the global stage. One of the most interesting examples is Africa.
The outlook for Africa
As a collection of disparate economies, and with mixed experience in manufacturing, Africa largely missed out on the opportunities afforded by globalization. Today, it is starting to gain ground and has a selection of success stories, notably in Mauritius, Ethiopia and Tanzania.
There are also encouraging <a href="https://www.odi.org/comment/10382-why-african-manufacturing-doing-better-you-think">signs of growth</a> for the continent as a whole. Manufacturing in Africa – although having declined as a share of GDP in most individual countries – is actually growing in absolute terms. Between 2005 and 2014, production more than doubled from $73 billion to $157 billion. Additionally, foreign direct investment (FDI) has been increasing, while direct investment from one African country to another is now a significant source of FDI.
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However, Africa’s total share of global manufacturing exports remains at less than 1%. Moreover, together with Latin America, it holds less than 8% of the market in the big five new production technologies (the Internet of Things, Artificial Intelligence, robotics, 3D printing and enterprise wearables).
Geographic adoption of technologies
As I wrote <a href="https://www.weforum.org/agenda/2016/05/how-can-african-manufacturing-achieve-its-full-potential/">last year</a>, population growth and the associated need to create jobs mean that Africa has no alternative but to continue to develop a strong, value-added manufacturing base. In addition, increasing consumption – driven by a rising middle class – presents another argument for industrialization.
Two windows of opportunity
For Africa, the advent of the Fourth Industrial Revolution and the trend of “islandization” both offer opportunities to catch or even leapfrog its global competitors through the use of innovative approaches to industrialization.
Firstly, new technologies are undoubtedly <a href="https://www.weforum.org/whitepapers/technology-and-innovation-for-the-future-of-production-accelerating-value-creation">improving the economics of local production systems</a>, enabling developing communities to become more self-sufficient. Local production also reduces the need for costly, long-distance transportation, which has long impeded Africa’s ability to compete. Meanwhile, as costs rise in China and other economies start to move up the value chain, Africa could emerge as an alternative source of light manufacturing. Along with an improving business environment, the Fourth Industrial Revolution could potentially provide Africa with a launchpad to accelerate its industrial development.
“Islandization” might seem an unlikely opportunity, but, while undoubtedly problematic from a rational economics perspective, the trend does not foreclose Africa’s right to rise economically. On the contrary, it offers an additional blueprint for future success. With the other major players setting up their own “islandized” economies, Africa could seize the opportunity to do the same, in an inspired way. By viewing its own market bloc as the end consumer base for production, Africa has the ability to grow its global competitiveness. If enacted, the African Union’s proposed Continental Free Trade Area could double intra-African trade from its 2012 level by 2022.
Of course, this is not to suggest that Africa should become protectionist or replace all foreign imports with domestic production; rather, the idea is to find ways to reduce its own internal barriers and create free trade across the continent. This would encourage inward-facing markets and the free movement of people and ideas, and establish value chains on the continent, while addressing longstanding infrastructure challenges.
If Africa can ride both of these trends, it will kick-start an industrial upswing, presenting an opportunity for the continent to emerge as an economic power in its own right.
This article was supplied to CNBC Africa by WEF Africa. Watch our coverage from 3-5 May 2017

Op ed: Embracing “islandization”: how an unlikely opportunity could help Africa achieve inclusive growth

After almost two decades of robust growth, there has been a sharp deceleration in economic activity in Sub-Saharan Africa. Lower commodity prices but also mounting imbalances in some of the region’s largest economies have taken average growth for the whole region down to 1.5% in 2016. A slight increase to around 2.5% is expected this year — markedly lower than the 5-6% of earlier years.
Sub-Saharan Africa: real GDP growth, 2016
[bc_video video_id=&#8221;5420348167001&#8243; account_id=&#8221;1571595826001&#8243; player_id=&#8221;default&#8221;]
The full picture is more complex: since 2014, oil exporters, including Nigeria and Angola, have experienced substantial declines in growth leading to large revenue losses and balance-of-payments pressures. Conditions in many other resource-intensive countries, including South Africa, have also remained difficult. At the same time, most countries that are not resource-intensive — such as Côte d’Ivoire, Kenya or Senegal — continue to grow robustly. But, even in these faster growing countries, vulnerabilities are building.
Sub-Saharan Africa: real GDP growth, 2000–14 vs. 2015–16
So how can the growth engine in Sub-Saharan African be restarted? In the spirit of the Ghanaian Akan Sankofa bird, we should draw on the past to chart the way forward.
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Looking back at the period from 1950–2016, Sub-Saharan African countries have not had any trouble getting growth going. Furthermore, since 2000, in contrast to other developing economies, countries in the region have experienced less volatile growth and fewer growth decelerations (“down-breaks”), while still enjoying numerous growth accelerations
(“up-breaks”).
Likewise, sustained periods of growth (“growth spells”) have been common in Sub-Saharan Africa. The region has recorded about 40 growth spells between 1950 and 2016 — a record that is in line with other regions. What’s more, growth spells in Sub-Saharan Africa became more frequent after 1995. This reflects improvements in the business and macroeconomic environment, increased trade integration, and a generally supportive global environment with high commodity prices and accommodating financial conditions. This good performance was spread throughout the region — in both resource-intensive countries and countries that are not resource-intensive — providing an opportunity to lift living conditions across the continent.
Sub-Saharan Africa: growth spells, 1960–94, and 1995–2016
Getting growth started is one thing, keeping it going is another. Our work shows that compared with other regions, growth spells tend to be shorter and more often end in a ‘hard landings’ with economies lapsing into recession. This result still holds after controlling for the incidence of armed and political conflicts.
To understand these findings, we looked into the factors that underpin durable and sustained growth episodes. We found that the key driving factors are a supportive external environment and the right economic policies and institutions. But how important are these factors and policies in prolonging growth spells? As it turns out, they matter a lot. Starting from the median value in Sub-Saharan Africa, an improvement in macroeconomic variables or institutions by 25 percentile points increases the typical length of a growth spell by one to eight years. Those additional years of growth provide significant opportunities to further raise living standards.
All in all, Sub-Saharan African countries are good at getting growth going; there have been many more growth spells of late; and sustaining growth requires getting domestic policy right. So, what concrete actions are needed at the current juncture?
<ul>
<li>In those countries where significant macroeconomic imbalances have emerged, the reform priorities are: reducing fiscal deficits through stronger domestic revenue mobilization; better prioritization of spending on key infrastructure projects and social protection; and, where the monetary regime allows for it, greater exchange rate flexibility to foster competition and economic diversification.</li>
<li>In countries where growth remains buoyant, it is important to avoid an unsustainable increase in public debt while they are still in a position of strength. Here too, greater revenue mobilization offers the best route to maintain fiscal space for the many development spending objectives countries have.</li>
<li>For all countries in the region, complementing macroeconomic policy reforms with reforms to unlock growth potential is critical. These efforts include: strengthening the macro-structural policies that support investment and economic diversification; facilitating the adoption of technology; and promoting openness and integration with the global economy.</li>
</ul>
Now is the time to take steps to adjust policies to ensure macro-stability so the region can move beyond its current rough patch and expedite growth in the medium-term.
This article was supplied to CNBC Africa by WEF Africa. Watch our coverage from 3-5 May 2017

Op-ed:  Drawing on the past to chart the future: how Sub-Saharan Africa can become a driver for economic growth once again

One of the key issues to be discussed at the <a href="http://cnbc.africa/category/insights/world-economic-forum/wef-africa-2017/">World Economic Forum – Africa</a> gathering this week is the ongoing development of capital markets in Africa. This matter has been discussed over the last number of years and has gained importance as it is seen as a key source of future funding for the continent.
Following the global financial crisis, sub-Saharan African sovereigns capitalised on an era of low interest rates and the global search for yield, by issuing US$-denominated Eurobonds to international investors at attractive spreads. There are currently 15 countries in sub-Saharan Africa which have issued Eurobonds, with a total market capitalisation of c.US$30bn. Eurobond issuance by sub-Saharan African peaked in 2014 amounting to US$8bn. The growth in this market provided benefits to sub-Saharan Africa in the form of increased diversification in funders and sources of funding. The increased focus by global investors on sub-Saharan Africa resulted in growing interest in the local capital markets as well, assisting in the further development of these markets.
During 2016, however, issuance declined to US$5bn, with South Africa accounting for US$4.25bn of the total issuance. Ghana was the only other entity in sub-Saharan Africa to issue a Eurobond in 2016, amounting to US$750m.
The decline in Eurobond issuance from sub-Saharan African sovereigns was driven mainly by reduced risk appetite from investors leading to rising yields, which made it less attractive for sovereigns to issue bonds. This was primarily as a result of low commodity prices, especially oil. This in turn resulted in weaker exchange rates which increased the costs to service the US$-denominated debt instruments. Further, liquidity shortages in foreign currency placed additional strain on sovereigns to service hard currency denominated obligations. Nigeria and Ivory Coast, were some of the sovereigns which delayed issuing Eurobonds during 2016.
Ghana was the first country to be impacted by the above events to the extent that it approached the International Monetary Fund (IMF) for financial assistance in April 2015. The IMF provided 3-year emergency funding which is due to last until April 2018, however Ghana is currently in negotiations to extend the programme to at least December 2018. During January 2017, Mozambique became the first sub-Saharan African sovereign to default on its recently issued Eurobonds when it was unable to service the coupon payment on a bond which is guaranteed by the government. Mozambique is currently in negotiations with the IMF for financial assistance. Finally, Zambia has also been impacted by low copper prices and other challenges to its economy resulting in it approaching the IMF for final assistance, which is currently under negotiation.
Despite the problems experienced by certain sub-Saharan African sovereigns, there has been renewed interest in Eurobonds over recent months. Yields on bonds have reduced on the back of improved commodity prices and a renewed search for yield from global investors. Nigeria was the first sovereign to take advantage of the lower yields, issuing US$1bn in February 2017 and raising and additional US$500m in March 2017.
The latest yield summary of recently issued Eurobonds based in sub-Saharan Africa is detailed below:
<table width="616">
<tbody>
<tr>
<td width="103">Issuer</td>
<td width="103">S&amp;P Rating</td>
<td width="96">Term</td>
<td width="114">Maturity Date</td>
<td width="98">Yield @ Issue</td>
<td width="103">Current Yield</td>
</tr>
<tr>
<td width="103">Nigeria</td>
<td width="103">B</td>
<td width="96">15 years</td>
<td width="114">February 2032</td>
<td width="98">7.875%</td>
<td width="103">6.85%</td>
</tr>
<tr>
<td width="103">Ghana</td>
<td width="103">B-</td>
<td width="96">6 years</td>
<td width="114">September 2022</td>
<td width="98">9.250%</td>
<td width="103">7.44%</td>
</tr>
<tr>
<td width="103">South Africa</td>
<td width="103">BB+</td>
<td width="96">12 years</td>
<td width="114">September 2028</td>
<td width="98">4.300%</td>
<td width="103">4.87%</td>
</tr>
</tbody>
</table>
South African investors have the ability to earn attractive US$-denominated returns when investing in sub-Saharan African sovereign Eurobonds, especially when compared to the South African Eurobond. However, there are a number of factors to take into account when comparing the returns including liquidity in the instrument, the underlying credit quality of the sovereign and the ability of the sovereign to service US$-denominated debt.
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In most cases, the issuers of sovereign Eurobonds in sub-Saharan Africa remain economies which are highly exposed to commodity prices. This results in demand for investment into the capital market instruments currently in existence being cyclical and dependent on global investor sentiment. The development of sustainable local capital markets will require international investors to take a long-term view on the underlying economies. Until such time as these countries have successfully diversified away from a dependence on commodities it will remain challenging to attract the required level of investment into local capital markets.
&nbsp;

Op-ed: Are sovereign Eurobonds making a comeback in Africa?

Africa has enjoyed an enviable streak of strong economic growth. For the past 16 years, <a href="http://www.visa.co.za/za/en-us/aboutvisa/newsroom/pressreleases/uploads/Visa_Africa_Integration_index_2014.pdf">the region has maintained an average GDP growth rate of 5%</a>, which has outperformed the global average by about two percentage points per annum. But recent disruptions in global commodity prices and greater competition for global trade have made the outlook for future economic growth more uncertain.
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Electronic payments offer a highway to that future growth. A Visa-commissioned Moody’s Analytics study looked at the impact electronic payments have on economies around the world. The research found that in emerging markets between <a href="http://www.visa.co.za/za/en-us/aboutvisa/newsroom/pressreleases/uploads/Visa_Africa_Integration_index_2014.pdf">2011 and 2015 a 1% increase in card usage produced a $29 billion increase in consumption.</a> 
For Africa the potential is tremendous: according to the World Bank, roughly two-thirds of the adults on the continent remain unbanked and card penetration is low. By improving access to electronic payments and financial services in general, we will be able to play a part in helping more people contribute actively to robust, sustained economic growth, and improve their lives. It is an ambitious vision of the future. To fulfill it, we will need public-private partnerships, an open playing field and the ability to scale our investments. 
A team solution
Public-private partnerships can help societies move away from inefficient cash economies that also lack transparency. Not only that, they are fundamental in creating investor confidence. They demonstrate that governments are willing to invest as much as we are to make it successful and support the concept of shared value for sustainable growth. 
Benefits of openness
To take advantage of one of Africa’s great strengths — a young, tech-savvy, increasingly educated population (the Economist Intelligence Unit estimates that between 2010 and 2030 the continent will add 122 million people to its labour force) &#8211; we are encouraging technology development on open platforms. Yet it can be difficult to scale innovation in a continent of 54 countries and nearly 2,000 languages. Local governments, which willingly champion electronic payments because they see the benefit to their economies, also need to allow for a level playing field in which we can all operate equally. If Africa wishes to draw the eye of global investors away from other emerging markets, where returns might be more immediate, it must offer those investors stability and prudent governance. This means setting up non-discriminatory regulatory frameworks and making mobile data services affordable for more people.
Scaling from a keypad
The importance of the phone to financial inclusion cannot be overstated. Mobile, app-based banking has made more inroads in this area in the past 10 years than the 50 years of bank branches and plastic cards that preceded it. African consumers are now outgrowing the first generation of mobile-based, money transfer technology, and mVisa — a mobile app which allows consumers to scan, pay, and go — is there to meet these expanding needs. 
Using electronic retail payments allows money to cross borders and add scale. But electronic payments have an additional advantage: they generate data. Cash is data-less, which means that cash payments for, say, water, don’t establish a history for someone who reliably pays for water. But the good credit history that would show in a user’s electronic payments would enable a bank to make better lending decisions, decisions that multiply the effect of its investments. Simply put, a consumer paying her bill electronically builds up a credit history and, because she has a credit history.
Of course, we face the challenge of increasing the acceptance of digital payments. Developing meaningful levels of acceptance among merchants is tough in an economy of small businesses. In developing countries, <a href="http://www.dalberg.com/wp-content/uploads/2016/11/Small-merchants-big-opportunity.pdf">180 million small merchants, many in rural areas, produce 4.5 billion daily interactions.</a> Yet more than half of those merchants do not have a bank account and do not use digital payments. At Visa we have seen that traditional approaches have not worked well, especially for SMEs, and even more so for those operating in rural communities.
This gap comes down to the issue of reliable infrastructure, awareness and education. In Rwanda, we embarked on a multi-year programme to help the country build a payment infrastructure from scratch, including connecting ATMs to the Visa network, building capacity in banks, offering mobile phone banking, and increasing merchant acceptance. A report by the non-profit Initiative for Global Development (IGD) found that the programme strengthened the local capacity for financial services and enhanced Rwanda’s appeal as an investment destination.
But our work doesn’t need to be on such a large scale to make an impact. When we ensure that people can pay electronically in the South African Post Office, it helps. When we open up electronic acceptance at the gas pump in Mozambique or in fuel stations in South Africa, that helps. We will continue to think about more ways to help. After our successful recent launch of mVisa in Kenya, we plan to launch it in Nigeria and other markets. Every little bit of infrastructure goes towards building more inclusive economies.
Africa’s global leadership in digitizing cash illustrates the region’s potential in the 21st century knowledge economy. Building public-private partnerships, supporting an open playing field and scaling in an economy consisting of dozens of countries are not small tasks, nor are they easy. But the rewards of revving up a regional economy with massive potential for growth, and creating efficiency that could better the lives of many, make tackling the challenges worth it — indeed, it is incumbent upon us.
This article was supplied to CNBC Africa by WEF Africa. Watch our coverage from 3-5 May 2017
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Op-ed: The road to Africa’s future growth is paved with electronic payments   

You don’t have to be long in any African city to feel the entrepreneurial energy on the streets. For those of us who grew up on the continent, it’s very much a fact of life. But for those visiting, perhaps for the first time, it can seem overwhelming.
There is no single reason, of course, for this bustle and energy. But a big part of it comes from the fact that Africa has the youngest population of any continent. On every street corner and in shops and offices in every neighbourhood, there are young entrepreneurs determined to make a living and build a business.
This demographic dividend could – and should – be a huge advantage for Africa. Six out of ten of our population are already under 24 and the proportion of young people is growing all the time.
By 2050, our continent will be home to nearly half a billion people who have either just entered or are about to enter the labour force. Their talent and enthusiasm can be the motor to accelerate Africa’s development.
Look at the way young Africans are adopting and adapting technology for their own use and to create new business opportunities. Lagos – a city I know very well – is an extraordinary hub of tech start-ups and similar centres are sprouting up across the continent.
We are seeing the same creativity in many other sectors including mass market consumer goods, financial services and health. In a continent which has not seen the large increases in GDP in recent years translated into new jobs, this should be a powerful driver of both development and employment.
But it has too often not had the impact it should with lack of finance among the major barriers which need to be overcome. Good ideas are being wasted because the money is not there to back them while successful start-ups are being starved of the resources they need to grow.
Small and medium-sized businesses, of course, complain in every continent – often with reason &#8211; about their difficulty in accessing finance. But African entrepreneurs have more reason than most to protest.
Why is this the case? In many parts of our continent, banking is not as well developed or mature. Lending risks can be more difficult to assess. Competition for available funding is greater, with governments, who are safer bets, also keen to borrow and effectively crowding out the private sector. When financing is available, interest rates are high.
It explains why there is plenty of anecdotal evidence from Africa’s entrepreneurs that only financial support from family and friends enabled them to succeed &#8211; no matter how good their idea or how well their young business was doing. The result is that, despite all this energy, African countries remain well down international league tables of entrepreneurial activity.
The difficulty of accessing capital is not the only reason for this poor showing. Entrepreneurs also suffer from a lack of wider support and training. The professional skills needed to help take a business to the next stage can be hard to find.
FOR MORE WEF AFRICA CONTENT READ:
<a href="http://cnbc.africa/category/insights/world-economic-forum/wef-africa-2017/">WEF AFRICA 2017</a>
But other fast-developing regions such as India, where TPG does a great deal of work, have been more successful in creating the right environment for entrepreneurs to thrive.  The Indian government has launched actions plans to support entrepreneurs and provide subsidies, <a href="http://startupindia.gov.in/">Startup India</a> and <a href="http://digitalindia.gov.in/">Digital India</a> are just two examples.
The good news is that there is a widespread recognition in Africa of just how important it is to do more to harness the entrepreneurial spirit in our continent. African governments along with international institutions such as the African Development Bank and World Bank and NGOs all have initiatives in place.
There is also a big role for private equity to help fill the gap in funding. But if it is to have the impact needed the approach must be flexible, ready to back businesses of all sizes and across their entire life cycles. It has to think small as well as big and be focused on the long-term.
This is the approach, tailored to the needs of different African markets, at the heart of the partnerships being forged through TPG Growth’s investment activities in Africa. These investment vehicles allow us to spend capital effectively at whatever level needed and build long-term relationships so we can provide not only funding but also wider support.
It is an approach which helped TPG play a big part in supporting the entrepreneurial- led tech revolution on the US West Coast. We build our reputation in backing small companies which have gone on to become big names.
It is a long way from California to Cape Town, Lagos and Nairobi. But what they share is the strength of the entrepreneurial spirit. The challenge is to help Africa’s army of young entrepreneurs turn their ideas into successful businesses not just in their city, country or continent but, in time, across the world.
*<a href="https://www.tpg.com/team/who-we-are?title=Yemi+Lalude">Yemi Lalude</a> is the managing partner of TPG Africa and of the TPG/Satya partnership. He is Nigerian and was the founding partner of Adlevo Capital previously. This is his first op-ed.
WEF Africa is currently taking place in Durban. Watch our coverage from 3-5 May 2017

Op-ed: Africa’s start-ups are booming but more needs to be done

(DURBAN) South Africa&#8217;s President Jacob Zuma said at the <a href="http://cnbc.africa/category/insights/world-economic-forum/wef-africa-2017/">World Economic Forum in Durban </a>that he didn&#8217;t mind being <a href="http://cnbc.africa/news/political/2017/05/02/south-africas-zuma-quits-may-day-rally-boos-crowd/">booed by the angry masses </a>because it showed democracy was alive and well in his country &#8211; but saved a flash of anger for the questioning of his presidency.
President Zuma &#8211; under pressure through divisions in his ruling party and a <a href="http://cnbc.africa/category/trending/sa-downgrade/">downgrade to junk status</a> &#8211; was at his palm-pressing and chuckling best as he toured WEF Africa ahead of first speeches later in the day. He greeted workers and politicians alike with handshakes on his progress around the ICC in Durban before taking a few questions at an impromptu press conference, the first of which was about him being booed by workers at the May Day rally in Bloemfontein.
&#8220;Booing is part of the culture of democracy. I am very happy that people can demonstrate their feelings it is part of the maturing of our democracy,&#8221; say Zuma.
&#8220;People are free to do this and I am not going to charge a policeman with arresting them. This is not a dictatorship.&#8221;
There was a flash of anger when another journalist questioned his tenure as president amid so much protest.
&#8220;I am an African, elected by Africans. What is your problem? You have a problem.&#8221;
President Zuma is one of a <a href="http://cnbc.africa/insights/world-economic-forum/wef-africa-2017/2017/05/02/mugabe-wef-africa/">number of heads of state expected at WEF Africa</a>, which lasts until Friday. He said during his tour of the building he was happy that the event had been well organised.
&#8220;Africa is the future&#8230;We as Africans are discussing what will happen with our economies. No one is speaking for us; we are deciding our own future.&#8221;
Other heads of state expected in Durban are President Robert Mugabe, on his first WEF visit since Tanzania 2010, Ugandan President Yoweri Museveni and President Edgar Lungu of Zambia.

SA President Zuma speaks at WEF Africa on being booed, Africa is the future

There couldn’t be a better place for the World Economic Forum roadshow to land in Africa this week than next to the blue Indian Ocean with all its blue sky possibilities – surely a fillip for the mind, at least, in these grey days for business. Thousands of delegates will land in Durban, KwaZulu-Natal, chosen over WEF’s usual playground in the fashionable tourist trap of Cape Town.
This will not only inject millions into a tourist city – that sometimes looks a bit frayed around the edges – but also comes at a time when the host nation is suffering incredible angst over its economic future. The once mighty South African economy is suffering a painful identity crisis over its long held, but not always warranted, title as the so-called the investment gateway to Africa.
What staggers me is that the people in power in the nation hosting WEF appear sanguine, to the point of complacent, over the cabinet reshuffle and subsequent downgrades to junk that are likely to play havoc with the economy.
The good thing about holding WEF in South Africa is that visiting delegates will not have to rely on reports, researchers and fact finders to sift through what is going on; just bump into your average working South African and you will hear it all in two minutes: uncertainty, struggle, fears for the future and concern over vague policy.
Speaking of vague policy, two words you will hear thrown around WEF quite a bit this year will be: “Inclusive growth.” It sounds good in cabinet, implying that everyone, right down to the poorest of the poor, should benefit from growth. I have always found that a strange misnomer because when there is growth it is the poor and the unemployed who are among first to feel its benefit through the multiplier. Jobs are created, industries spring up, money spent on goods and services, more taxes are paid to the benefit of those who can’t find jobs in the boom. If there is a lot of growth employers will have to hike wages, as competition for workers grows, which will increase living standards.
The only problem is that growth is viewed with nostalgia in South Africa right now and all the political slogans in the world are unlikely to change this. Forbes Africa believes the unfettering of private money will help to foster this growth that could take the country back to the prosperous days of 2005.
WEF will also be a good time for the business and political leaders of Africa to check the temperature of the world and continental economy. In Durban there will be plenty experts on what the Trump administration has in store for Africa; how power and infrastructure could hold the key to growth and how investors are trembling after weeks of pantomime in Africa’s most robust economy.
I always wonder about the wisdom of holding top level economic conferences in seaside resorts because the reassuring rhythmic crash of waves on the beach can lull delegates into a false sense of security.
Yet in Durban this scene can double as a field trip for WEF delegates. The wide blue Indian Ocean they will see out of their hotel windows could play a big part in the economy of Africa. According to South African government estimates, the ocean economy could lift growth by 4% by 2019 and create over a million jobs by 2033. It is one of the last, great, untapped resources.
The campaign to harvest the sea and create growth was well named by the South African government &#8211; Operation Phakisa. In Sesotho, it means hurry up.

WEF Africa Durban

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Op ed: Embracing “islandization”: how an unlikely opportunity could help Africa achieve inclusive growth

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Op-ed: Are sovereign Eurobonds making a comeback in Africa?

Op-ed: The road to Africa’s future growth is paved with electronic payments

Op-ed: Africa’s start-ups are booming but more needs to be done

SA President Zuma speaks at WEF Africa on being booed, Africa is the future

The World Economic Forum roadshow lands in Africa

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WEF Africa Durban

These five leaders are exposing corruption and bringing hope to Africa

Africa needs to take urgent action to harness its youth dividend

Op ed: Embracing “islandization”: how an unlikely opportunity could help Africa achieve inclusive growth

Op-ed: Drawing on the past to chart the future: how Sub-Saharan Africa can become a driver for economic growth once again

Op-ed: Are sovereign Eurobonds making a comeback in Africa?

Op-ed: The road to Africa’s future growth is paved with electronic payments

Op-ed: Africa’s start-ups are booming but more needs to be done

SA President Zuma speaks at WEF Africa on being booed, Africa is the future

The World Economic Forum roadshow lands in Africa

News Tips

Advertise With Us

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