Elumelu: Africa Should Be Positioned as a Destination for Global Capital

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The Chairman of Heirs Holdings, Mr. Tony Elumelu, in this interview with Obinna Chima at the World Economic Forum on Africa in Kigali, Rwanda, spoke on the need for partnerships between the public and private sector on the continent to develop policies that would create jobs and engender economic prosperity in Africa. Excerpts:

You have been associated with the World Economic Forum for more 10 years now, what value do you think Africa has benefited from the policy dialogues at these meetings especially in the quest to create jobs, reduce inequality and attract global capital?

I accepted the role of co-chairman at this World Economic Forum because it aligns with my own principles and belief. I believe that we must as a continent do something about the youth engagement. Secondly, my philosophy as an Africapitalist is that it is not only government; the private sector has a role to play in developing the continent to make long-term investments in key sectors of out continent so as to create economic prosperity and social welfare.

So, having a WEF on Africa programme that talks about how to leverage digital transformation in harnessing and mobilising our abundant resources in the continent, I felt that was wonderful. Wonderful because I like to see my friends from outside of Africa to visit the continent so that they can see that what they read in the newspapers or what they watch on the television are far from what is on ground. This is a new Africa.

You can only go or invest in business in a place where you are comfortable. So, as they come and see that we are not in the jungle, all things being equal, they would want to bring their money to invest here (Africa). This is because there are so many global private capital looking for destination. We should position Africa as the destination for this capital because it is massive capital inflow into Africa or massive capital investments by us Africans to help create the kind of job and economic prosperity that we need.

And that is where the alignment with Africapitalism comes from. But what I have been preaching is let us move from talking to doing. Let’s go back with a clear agenda, so that by the time we meet next year on in two years’ time, we would look at how efforts we have made in implementing some of the agreements reached. We need the media to tell the world that it all about how to create jobs in Africa, advance economic prosperity and advance inclusive growth, so that you don’t say the Gross Domestic Product (GDP) is moving and people on the ground are not feeling it.

They don’t feel it because we do not engage in industrialisation and processing of our raw materials, everything is imported. I see myself as an Africapitalist in everything that I do I am concerned about economic empowerment of our youths. I am concerned as many of our participants that we need to be careful in Africa and make sure that our demographic boom does not become demographic doom and the way to do this is to make sure that we economically empower our youths. We have a lot of them, but if we don’t do this, it can become a major trouble for us and I am happy that this WEF on Africa, we are talking about job creation in a manner that is functional in the 21st century, access to electricity, which would help us to achieve the empowerment of our people.

The foundation I founded and I, we are trying to encourage entrepreneurs. We observed that our people have great ideas, but the problem they suffer is lack of mentors, access to capital and proper training. So, we are trying to do this. Twenty-two years ago, I endowed $100 million to the Tony Elumelu Foundation to run an entrepreneurship programme across the continent. The programme is open to everyone in 54 African countries. The first batch was very successful.

So, the conversation should begin to change. That was why I said I was happy to see people visit Africa, people who manage billions of dollars. If they go back and are impressed, if you present any Africa investment strategy to them at their board meetings, there are chances that they would okay it. But if they have a negative perception and if you ask them to invest in the continent, they would definitely turn it down. This, to me is the significance of what we are doing at the WEF on Africa.

In terms of access to capital, it is interesting that technology and finance have not really converged in Africa to solve some of the bottom of the pyramid problems for SMEs. So, how can this problem be solved?

For me, the way I look at all of this is what is our vision? The purpose is to create an inclusive African society where male, female, old people, young people are able to have a decent standard of living and where poverty is drastically reduced. And there are many ways of achieving this. Firstly, it is all about leveraging technology secondly is about better education and thirdly better governance at the sub-national and local government level.

So, for me, we all need to work together – the public and private sectors, national partners and development partners, with the objective that we want to alleviate poverty by improving access to finance and we can achieve it. We have seen how Vietnam achieved theirs, so we can achieve it also as a continent, but we need to be serious, talk less and do more.

What is the drive behind the Tony Elumelu Entrepreneurship Programme (TEEP) and what success rate do you expect from the programme?

I am a proponent of Africapitalism, which is private sector participation in the development of Africa. Private sector is all about entrepreneurs. So, we need to keep the stock of private sector entrepreneurs. We should not see the current private sector leaders as the best or the only crop that Africa can offer. So, for me, looking at ones history and one’s past, I was born in Africa, I worked in Africa and created some wealth in the continent, both for myself and people who believed in me at a time.

So, I thought we should institutionalise this luck by creating similar opportunities for others that have ideas, we should encourage people to succeed, realising that ultimately, as they succeed, their success becomes a collective success for Africa. This is because if you link their success to the doctrine of Africapitalism – which means the private sector, has a role to play in Africa by investing in key sectors and helping to stabilise the society, then their success becomes the success of every one of us in the continent. In Africa, the private can and should be able to develop the continent, but we need to create the right environment.

So, that is the major driving force. How many do I think would succeed? I wish I am God to tell how many would succeed. But you know, we want to give people equal opportunity to succeed. We are a lot more interested in process because we think the right process would deliver the expected outcome.

The tenure is 10 years in the first instance. After 10 years, we would reappraise and take further decision. We believe that entrepreneurs need capital and education. It is amazing what we have seen working with these Africans. Recently, I was in Uganda to see some of them and I was very impressed with what they are doing. One of us told us how he was able to support solar power and took access to electricity to villages.

So, as I come to WEF, my expectation is that we should all work together. We have a huge number of unemployed Africans who have great ideas. The second batch that ended recently, 45,000 applied, unfortunately, we chose just 1,000. This is because the $100 million programme is $10 million every year and $10,000 per participant and we have 1,000 participants every year for 10 years. So, we are constrained to stop at 1,000 participants every year.