By Mosun Shashore
Despite being the second largest continent in the world, Africa’s entire GDP is a dismal ten per cent of the GDP of the United States of America. Nevertheless, Africa has been experiencing steady economic growth over the two decades. But this growth is hindered by infrastructure deficits; a lack of access to clean water, good roads, steady electricity supply, and health care, as well as a lack of robust and enabling policies.
This means that Africa has not yet been able to fully harness its growth potential. In order for Africa to unlock this potential and make doing business in Africa more encouraging and attractive, it must make purposeful long-term investments in addressing these deficits.
Underpinning these deficits is a lack of human capital. In order for Africa to truly participate in the global economy, we must develop a skilled workforce with the knowledge and experience to contribute tangibly to the continent’s productivity and the economy as a result. The GDP comparisons between Africa and The United States begin to make more sense when reviewed in the context of the labour productivity level comparisons of Sub-Saharan Africa which was a paltry 8% of the United States productivity in 2014 as well as being the lowest in the world.
To improve the region’s growth potential, the education system across the continent requires a major overhaul- a daunting task in itself when you consider Africa has a very high percentage of youth in its fast-growing population. Despite these challenges, emphasis and priority has to be placed on investing in the education system because of its inherent potential to deliver tomorrow’s doctors, engineers, policy makers, scientists, leaders and more.
How we develop our Human Resources will determine how bright our future as a continent is. There can be no sustainable economic growth in Africa, without adequate human capital development. To transform our continent, we must invest in skills accumulation and knowledge sharing. In addition to enhancing productivity levels, investing in our own human capacity will also reduce the amount spent on hiring foreign skilled workers.
While investing in human capacity, there is a need to create jobs that align with the kind of skills being acquired to mitigate the risk of preparing a workforce for a future that will not be realised. To create a sustainable economy and the associated jobs, African countries need to depend less heavily on natural resources as a diversified portfolio helps to insulate the economy from oil price-related shocks. The latest oil price shocks are still being felt by many African oil exporting countries as is evidenced by IMF’s revision of its 2015 GDP growth projection for SSA from 4.5% in April 2015 to 3.8% in October 2015, a sixteen year low.
Nevertheless, economic diversification is on the increase, albeit slowly, encouraged by foreign direct investment and an improved business landscape. For example, in Nigeria, although oil accounts for 95% of exports, services now make up 60% of GDP.But in order to become globally competitive and support our more diversified portfolio, we must address our human capital deficit.
We also need to commit to the procurement of more local content and the development of more initiatives that promote entrepreneurship. Our graduates and students need to be exposed to more real-world experience in vocational or white-collar roles. There are already a number of foundations and organizations rising to this challenge and driving initiatives that promote vocational training and mentoring.
Another such initiative can been seen in the Quramo Conference, an African platform created for dialogue involving professionals and experts from different disciplines to exchange and share ideas, build knowledge and stimulate youth development as well as influence policy and decision making. This year’s conference examined issues involving the human capacity requirement for today’s African economy.
Quramo envisages a future where Africa is wholly managed by African’s with the experience, technical expertise and financial acumen to take on the challenge on filling the infrastructure deficits and growing the economy. Our success depends on our ability to create an environment that is conducive for acquiring knowledge and on providing tomorrow’s leaders with the education, knowledge and motivation to build a better future.
– Shasore is chief executive, Quramo Advisory/Quramo Learning