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The rapid development of Africa’s private sector and emergence of a new class of leading African companies were highlighted at the Initiative for Global Development’s Frontier 100 Forum, signaling a growing recognition that African businesses are moving beyond their local market to enter the world-class space.
IGD is a US-based organization that harnesses the power of the private sector to create inclusive growth and alleviate poverty in Africa.
Under the theme, “African Business in the World-Class Space”, global business leaders gathered for IGD’s Frontier 100 Forum, an exclusive, invitation-only gathering, where they examined the tremendous opportunities and challenges that African companies face in reaching the world-class space and offered business strategies to successfully operate in the global marketplace.
The biannual event brings together CEOs and senior executives from IGD’s Frontier Leaders Network of US, African, European and South Asian companies. More than half of IGD Frontier Leaders hail from the African continent.
Dr Mima Nedelcovych, IGD President & CEO pointed out that when he served as the US Executive Director to the African Development Bank two decades ago, Africa’s private sector was neither strong nor well-developed.
“Today, Africa’s private sector is poised to become a major force for growth on the continent,” says Nedelcovych, citing that African born and bred businesses create more than 80% of jobs in their countries.
In a keynote address, Solomon Asamoah, African Development Bank’s vice-president of infrastructure, private sector and regional integration, called for African governments to develop stronger business environments for companies to flourish. Asamoah sats stronger business environments would involve government leaders putting in place consistent policies, increasing capacity and incentives for the government workforce, renovating airports, and transparency around the decision-making process to address corruption.
“We need more transparency in government decisions. Corruption happens in darkness. Shining a light on it can help end the problem.”
During the session on African companies operating in a world-class space, African business leaders said armed with local knowledge and insight into the African context, they are finding African solutions to overcome some of the obstacles to competing in the global economy.
Abdu Mukhtar, Chief Strategist for Dangote Group, the largest industrial conglomerate in West Africa, said his company routinely faces transportation and logistical bottlenecks in transporting goods by road throughout Africa. The Dangote Group is addressing transportation challenges by importing their own vehicles and reaching out to governments on improving infrastructure and regulations to ease the flow of travel between countries.
Global misperceptions on doing business in Africa still exist, despite the fact that the continent is home to some of the world’s fastest growing economies. “Fire starters” or pre-selected forum participants ignited a spirited discussion on how to shape the narrative on Africa.
Some blamed the media and aid organizations for negative narratives on Africa, but Amadou Mahtar Ba, Co-Founder and Executive Chairman of AllAfrica Global Media Inc., said there needs to be greater engagement from business leaders on changing Africa’s narrative. Rahel Getachew, an international marketing expert, added that how companies market their products from the product quality to user engagement also informs and influences the narrative.
Demba Ba, Senior Advisor of the World Bank’s MENA Vice Presidency, spoke about fully embracing Africa’s narrative — both the good and the bad. “Africa is a land of several pieces, not all of it is perfect.”
As innovation occurs at a rapid pace across Africa, the concept of “leapfrogging” is seen as a driving force in helping to advance Africa beyond current growth estimates. A diverse panel from the private and public sectors explored ways that businesses can incorporate innovation into their company culture and governments can nurture an environment for innovation.
“The future of growth is coming from Africa and it’s mobile,” said Stephen Kehoe, ‎Senior Vice-President and Head of Global Financial Inclusion at Visa. For example, Kehoe said Visa worked with the government of Rwanda to expand access to innovative financial services through electronic payments, such as mVISA, a Visa mobile money service.
Ambassador Mathilde Mukantabana of Rwanda said her government intentionally sought to create an environment to foster innovation and entrepreneurship. In the late-1990s, the landlocked country invested heavily in technology to attract private sector investments, which has led to greater economic development. “It was a combination of political will and initiatives such as empowering women that helped us engage various sectors of the economy,” said Ambassador Mukantabana.