The small African entrepreneurial revolution

Summary

The former vice president of the World Bank, Jean-Michel Severino is now at the head of Investisseurs et Partenaires (I&P), an investment fund that assists African SMEs in their development.
In his latest book, « Entreprenante Afrique », written jointly with his assistant, Jérémy Hajdenberg, he explores the entrepreneurial revolution now taking place in Africa. The book cast light on this little-known facet of the continent, and illustrates this genuine dynamic with lucidity, while giving the lie to « African pessimism ».

11Nov.
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Some figures to start with

Since 2010, Africa’s GDP has risen by 611%. Analysts predict that this GDP, shored up by a demographic growth that boosts its domestic market, will equal the European Union’s by 2050. With a population estimated at 2 billion, the continent could have a decisive influence on world affairs over the next few decades.

The book focuses particularly on the role played by a generation of determined men and women who have adventurously moved into the start-up. According to J.M Severino, the whole continent is currently building up its industry through a fabric of burgeoning family businesses and SMEs. « One of the features of the industrial process under way is that first of all, it is focused on the domestic market, said Severino to RFI,[1] with an overriding priority: to supply the continent by investing in the farming and food industry sectors.  One textbook, inspiring success he cites is that of Mamadou Lamine Sylla, an Ivory Coast entrepreneur who formed a company, Le Fermier du Denguele. After four years of continuous growth, his farm now has 70,000 laying hens and employees some fifty people. Added to this are the jobs created with chicken feed suppliers. So around 150 people live off this business, making it one of the largest companies in the entire region.

The emergence of an entrepreneurial middle-class

This book puts the spotlight on African CEOs who include yoghurt producers, pharmaceutical entrepreneurs, founders of hotel chains and cement manufacturers, but are also investing in energy and the new technologies. « They are creative and inventive, offer goods and services that meet domestic demand and position themselves in high-potential market segments not filled by international groups, » says Severino.[2] One of the most famous success stories in the continent is undeniably that of the CelTel company, launched by the Anglo-Sudanese entrepreneur Mo Ibrahim. Founded in 1999, CelTel was one of Africa’s very first mobile telephony operators, which obtained the first mobile licenses in Namibia and Uganda, and offered its services in Sierra Leone and the Congo Democratic Republic – two countries that had recently emerged from war.  The company underwent phenomenal growth, and by 2004, five years after its launch, it had over 75 million subscribers. The next year, it was taken over by MTC of Kuwait: a sale that involved the highest value increase achieved by a company in Africa’s history, outside the oil sector. Since then, the businessman has created the Mo Ibrahim Foundation   to promote better governance in Africa. As J.M. Severino tells us, « Most of the entrepreneurs we have met come from a middle class of qualified people with higher education. »[3] Estimated at 370 million people in 2016, this new entrepreneurial and highly creative middle class is literally carrying the African economy. Its numbers look set to reach 582 by 2030, according to the African Development Bank, with household consumption up by 5% a year since 2000.

Another dynamic aspect highlighted in the book is that this growth is also attracting ever more foreign companies and investors. Here J.M. Severino tries to elucidate  a number of questions: what role and attitude could be adopted by these new players? How can they encourage and intelligently assist these dynamics, which serve not only their own development but also that of the continent’s businesses and populations?

In his view, « the issue here is not just knowing whether Africa will be less poor in 2030 or 2050: it’s also knowing who will own the wealth created, and who will be the decision-makers and driving force in Africa’s emerging capitalism – financiers and big groups from the West, China, India, Turkey and Brazil, or powerful African players? » His solution would be to forge mutually beneficial international partnerships to enable African entrepreneurs to overcome their operational difficulties while remaining in control of their destiny – thus furthering the kind of development they want, which protects the environment and is shared on a social level.

[1] http://www.rfi.fr/emission/20161001-entreprenante-afrique-livre-jean-michel-severino

[2] http://magazinedelafrique.com/entreprenante-afrique

[3] http://www.rfi.fr/emission/20161001-entreprenante-afrique-livre-jean-michel-severino

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