“Africapitalism as a Catalyst for the Development of Africa” Text of Speech by Tony O. Elumelu at Oxford Africa Conference
By Tony O. Elumelu C.O.N.
delivered at Oxford Africa Conference, Oxford University,
London, May 22, 2015
SALUTATION AND ACKNOWLEDGEMENTS
Thank you very much Dean Tufano for that very generous introduction.
It’s great to be here at Oxford University, which continues to play an important role in the articulation of key global issues, as it has for hundreds of years.
I would like to appreciate the organizers of this conference for encouraging new thinking and perspectives about Africa across all disciplines.
I particularly want to thank Yasmin Kumi for her tireless work to facilitate my presence here today.
I want to speak about “Africapitalism as a Catalyst for Development in Africa.”
Today is a continuation of a conversation I started in November 2014 with a piece in The Economist where I declared that 2015 would be ‘The Year of the African Entrepreneur’ and backed it up in December by launching the $100 million Tony Elumelu Entrepreneurship Programme, also known as TEEP. This programme is identifying and providing mentoring, training, networking, and funding for 1,000 African start-ups per year for the next ten years.
The programme kicked off on January 1, 2015 and we had an amazing response from across Africa with over 20,000 applications from 54 African countries and territories. With support from Accenture and a pan-African Selection Committee, we picked 1,000 amazing entrepreneurs from 52 African countries. These 1,000 are now in the midst of a 12 week online business skills training programme, and have been paired with 400 expert mentors from around the world. In July, they will come from all corners of Africa to Lagos for a boot camp where they will complete their training, receive their first cheques, and build pan-African networks that will last a life time.
Last week, I was at the White House in Washington to support President Obama’s Global Entrepreneurship Initiative, “SPARK” where I was invited to speak about my vision for how entrepreneurship can transform Africa, including a focus on the Tony Elumelu Foundation Entrepreneurship Programme. The following day, I gave a keynote address at Georgetown University titled “Entrepreneurship-led Development”, where I spoke specifically about how entrepreneurship represents a bottom-up approach to development – the kind of small, young entrepreneurs supported by my foundation.
I’ve focused on entrepreneurship because it is the beginning of the story of how private enterprise can impact the development of Africa. After all, a healthy and resilient business ecosystem has a spectrum of enterprises – from the small entrepreneurial venture all the way up to the large, established multinational companies.
And today, I will focus on what already-established businesses can do to advance Africa’s development through an economic philosophy I call “Africapitalism” – which centers around the private sector’s critical role in driving economic and social development across the continent. In this context, my focus will not be on the individual entrepreneur, but on what the large, established companies in Africa, or those planning to come in to Africa, can do to maximize the private sector’s development dividend.
FOLLOW THE MONEY
Currently, African and donor governments preoccupy themselves with developing the right aid programs and the right level of spending in each sector to advance development- OECD countries aim to set aside .7% of their national budgets for international development. On the African side, our African governments debate what percentage of their federal budgets to allocate to the various sectors of greatest social need- 5% for health according to the Abuja Declaration and 10% for agriculture according to the Maputo Declaration, for example.
Governments are the key players in official aid flows, aided by philanthropies and non-profit service organizations. For example, last year, Africa received a total of $56 billion in Official Development Assistance (ODA), and a few billions more in philanthropic assistance – a new high water mark for total ODA to Africa in a single year. However, even with aid at record levels added to billions more in philanthropic funds, it is still dwarfed by the total amount of annual private international capital flows to Africa.
Last year, Foreign Direct Investment (FDI) to Africa was $57 billion – a billion more than what we received in official bilateral and multilateral aid. When we combine remittances and intra-African investments with FDI, we are talking of nearly $200 billion in private capital a year and rising. This is already having an impact on development on the continent, but with a more deliberate effort to drive a new kind of private sector investment model, this could definitely have an even greater impact.
Read the rest of the speech here.
