Dr. Mima Nedelcovychand is the President and CEO of the Initiative for Global Development, a Washington D.C.-based network of African and global business leaders committed to advancing inclusive growth through investment on the African continent. He told Eromosele Abiodun what African governments need to do to grow sectors that create more jobs
Initiative for Global Development (IGD) has been existing now for over 10 years and many people in Africa do not know anything about IGD. Can you tell us about your organisation?
The Initiative for Global Development (IGD) is a Washington DC-based network of African and global business leaders who are committed to advancing inclusive growth through business investment on the African continent. IGD’s Frontier Leaders are CEOs and senior executives from sector-leading companies operating on the African continent. Our unparalleled network of global companies includes Microsoft Incorporated, Dangote Industries Limited, Afrexim Bank, Africa Finance Corporation (AFC), SeedCo, Illovo, Visa, General Electric, Construction Kaiser and Pearson, among others.
As part of the effort to help Africa out of its economic problems the Africa Growth and Opportunity Act (AGOA) was enacted a few years ago, can you tell us how Africa has failed to take advantage of AGOA and what opportunity still exist for the continent?
The Africa Growth and Opportunity Act or AGOA was enacted in 2000 to expand US trade and investment with eligible African countries to fuel economic growth and promote greater economic integration into the global economy. The US-Africa trade law was renewed in 2015. There has been some significant progress in expanding trade relations between AGOA-eligible countries and the US. The business environment in Africa has evolved dramatically from when the law was first passed in 2000 compared to 2015.
Today, the Sub-Saharan Africa region has some of the world’s fastest growing economies. African born and bred companies are increasingly export-ready, taking advantage of AGOA and operating in the world-class space. However, much more needs to be done. At the end of the day, you can sign and enact trade agreements, but if you don’t have the concentration of African businesses that have the capacity to produce products and goods competitively for the US market, you really cannot maximise AGOA’s potential. So, the next phase of AGOA should focus on supporting African businesses to enhance their trade capacity to move beyond their local markets and operate on a global scale. I believe that African governments must do their part to help create an enabling business environment and infrastructure for African businesses to be able to produce cost-efficiently and thrive to succeed in the global marketplace.
You are a non for profit organisation that engages and harnesses the power of the private sector to create sustainable growth and alleviate poverty in Africa. Tell us some of you achievements in this regard.
Through our Frontier 100 Forums, we bring together CEOs and senior executives from the African continent, US, Europe and Asia to catalyse greater business investment and impact on the continent. At our forums, our members make connections, share best practices and hammer out action agendas. IGD is proud of the fact that we created a task force of CEOs and senior executives, developers, lenders, investors, equipment manufacturers, and regulatory experts to seriously tackle addressing Africa’s power needs in a timely way. Power Purchase Agreements or PPAs were identified by our Task Force as one of the key areas where power generation projects could be accelerated. So, the Task Force created a standardised PPA tailored to meet the needs of individual African governments, so that both transaction costs and project development time could be reduced.
The standardised PPA will eventually lead to a greater number of bankable power projects in Africa. Contributing to the launch of Rockefeller Foundation’s YieldWise initiative, a global initiative to reduce Post-Harvest Loss (PHL) was another achievement of IGD. Across Africa, almost half of all food waste and losses occurs at the early stages of the food value chain. IGD partnered the Rockefeller Foundation to bring the collective business voice of Africa’s private sector to the PHL issue. By leveraging our influential network of sector-leading African companies, we gathered market perspectives and identified market-driven solutions on post-harvest loss in Ghana, Kenya, and Nigeria. Our on-going contributions to bring the African private sector voice to the YieldWise initiative will help to reduce crop loss and boost incomes of African farmers.
IGD was also pleased to release in July an impact assessment report, “Pioneering New Operating Models and Measurement Techniques for Private Sector-Led Development: Assessing Impact in Nigeria’s Niger Delta.” The report is the culmination of a yearlong comprehensive organisational assessment of the activities of Chevron-supported nongovernmental organisations, the Nigeria-based Foundation for Partnership Initiatives in the Niger Delta (PIND) and its US-based strategic partner the Niger Delta Partnership Initiative Foundation (NDPI). Overall, the report showed that the organisations that have “moved the needle” in laying the groundwork for greater development in the Niger Delta region of Nigeria are those that are interwoven in the fiber of the society, and rely heavily on the “diffusion of innovation.” The report also highlighted how the private sector can play a crucial role in helping to drive sustainable change and economic opportunity.
There may be some things you wish your organisation was able to achieve for Africa since you started that you have not been able to. What are those things and why do you think you failed?
IGD and our frontier leaders understand that expanding access to power takes time. We’d like to speed up the process, especially as it relates to boosting Africa’s industrialisation efforts and diversifying economies, but realize that it takes time. In the U.S, we were encouraged by the signing of the electrify Africa Act, a framework to help millions of people gain access to reliable electricity in African countries.
Our Spring Frontier 100 Forum addressed how the continent might move beyond a commodity-based economy and identified private sector-led solutions to enhance the value chain for industrialisation and stimulate value-addition to Africa’s natural resources. We are not where we want to be, in terms of giving more people access to power and increasing industrialisation effort, but we are moving forward in a positive direction. We would also like to see government officials consult more closely with the private sector, align common interests, and display greater political will in improving the overall enabling environment for business growth.
What can African governments do to assist your organisation achieve its aims going forward?
The IGD Frontier Leader Network works in close partnership with African governments and multi-lateral institutions through platforms provided by our forums, task forces and other convening activities. We provide a space for Africa’s private sector, governments, multilateral organisation and others to find common ground and identify long-term solutions to some of the business challenges that are preventing the companies from thriving and achieving inclusive growth.
IGD envision an Africa with thriving, impactful businesses that create inclusive growth and where business leaders are a positive force in shaping Africa’s future. Is this vision realisable?
Yes, absolutely. Our Frontier Leaders are already on the forefront in shaping Africa’s future. Our Frontier Leaders in Nigeria include the Dangote Group, Chevron Nigeria, Construction Kaiser, Africa Finance Corporation, Main One Cable Company Limited, Atlantic Imperial Limited, Saroafrica International, Computer Warehouse Group, Wilbahi Group, for example, areleading the way in creating jobs and opportunities in Nigeria.
How and what are the steps you have put in place to ensure this happens?
Through our forums and advisory services, IGD provides tools for businesses to maximise economic and social impact for inclusive growth. Our Advisory team of experts work with companies to develop a tailored impact measurement strategy which reflects their needs and priorities. After assessing a company’s operations, our advisory team provides strategic insight and innovative solutions to address some of Africa’s most complex challenges.
It is generally believed that lasting poverty reduction will only be achieved with significant private investment to spur growth and create economic opportunity. How has the private sector failed in this regard?
Collectively, the private sector, African governments, donor governments and other stakeholders all play a role in achieving greater private investment in Africa. We all depend on each other for private investment to flourish. Companies need solid infrastructure to manufacture and move goods. We need a strong business environment and supportive policies. Private investors want to know that they are investing in a stable country. A lot of factors need to be in place in order to spur growth and economic opportunity. The more we can align interests between the private and public sector, the more the private sector can invest directly and propose Public-Private Partnerships (PPPs) as required.
To create employment in Africa, there must be massive investment in sectors that create the most jobs like transportation, maritime and manufacturing. What can be done to spur investment in these sectors?
Long term private sector investments, such as are required for large infrastructure projects, are substantial in amounts and require assurances that the concessions and agreements with governments will stick across political administrations. It is all about political stability, established rule of law, sanctity of contracts and risk mitigation where such are missing. The ability of governments to understand the complexities of PPP arrangements is critical. As for stimulating the manufacturing sector, provision of infrastructure to make manufacturing competitive is essential. You simply cannot industrialise and manufacture without electricity. Governments must also assure true common markets, with free-flowing goods and services within that common market, allowing industry and trade to scale and thus be competitive both in the region, as well as to export outside the region.
IGD’s mission has evolved to focus on engaging global business leaders in an effort to foster greater strategic investment in Africa. Can you say you have been successful with this?
Yes we are as we engage business leaders throughout the continent, as well as well as those outside the continent, to take a good hard look at the investment opportunities on the continent. Our mission continues to be dynamic and evolves and recalibrates with the ever-changing global economy. But our core mission of strengthening the private sector for inclusive growth through business investment has remained steadfast since our founding in 2003, and will be highlighted going forward through our “Africa Investment Rising” Campaign we are about to launch.
In Nigeria, experts have said that the maritime sector alone can generate N4 trillion annually but private investors hardly put their money there due to government control. What do you think can be done differently?
Investors will not invest if they cannot get a proper return. Infrastructure investments in the maritime sector are sizeable and will require long-term assurances for concessions and other PPP mechanisms. Nigerian officials should learn from successful experiences elsewhere in Africa and the world and apply them to the Nigerian context. Ports without efficient evacuation of goods via roads and railroads are non-starters. I would look at improving the inland connection of Nigerian ports through road and rail links, including inland dry ports. One could start by taking a look at the legal framework of the Nigerian rail system which is still state owned and see how to open it to private investment or PPP structures.
Tell us some of the plans IGD have to drive private sector investment in Africa in the years ahead.
We are excited about launching a new campaign, “Africa Investment Rising” at our Fall Frontier 100 Forum in early October. By leveraging multimedia, this communications and advocacy campaign will amplify the voice of Africa’s private sector leaders, encouraging greater investment in Africa, and creating a better business environment for inclusive growth. Negative perceptions about Africa continue to create a significant barrier to potential international engagement and partnerships. To help confront these misperceptions, the campaign strives to shift the negative narrative on Africa to show impactful stories of business and investment opportunities, a growing and rapidly urbanizing African consumer class and successful business ventures through multimedia storytelling and strategic traditional and social media outreach.
In your profile you said you bring together CEOs and senior executives from leading African and global companies through your Frontier Leader Network to catalyse greater business investment and impact on the continent. Tell us about this.
We exclusively recruit CEOs and senior executives with the authority to set business strategy and designate necessary resources to invest capital in scaling their businesses to achieve inclusive and sustainable growth that benefits whole societies.
What message do you have for investors globally who are reluctant to invest in Africa?
Africa is still the place for tremendous investment opportunities. You must invest for the long-term. Urbanisation and spending power can be turned into opportunities. And, more than ever, many African countries are experiencing increased political stability and rule of law.
Where do you see your organisation in the next 10 years?
In the next 10 years, I see IGD continuing to thrive and engage our Frontier Leader Network in driving innovation and growth. We are excited about what lies ahead.
Can you introduce yourself and tell us what you do for IGD?
My name is Dr. Mima S. Nedelcovychand, I have served as President and CEO of the IGD since 2014. At IGD, I am responsible for the day-to-day management and execution of the long-term vision and plans for the organisation. I bring more than four decades of experience in global trade and investment to the position, specialising in privatisations, trade facilitation, project development, project finance, and public-private partnerships in Africa. From 1989 to 1993, I was as the U.S. Executive Director to the African Development Bank (AfDB) in Abidjan, Cote d’Ivoire, where I was instrumental in formulating the bank’s “private sector initiative”, the African Business Roundtable and the African Export-Import Bank. The last 20 years until I took on the IGD position, I was Partner and Chairman of Schaffer Global, a leading agro-business developer, and I am very bullish on the agro-industrial sector in Africa.