Time for Hope as Africa Rises

This article is written by Ms. Purvi Shah  who is Product Integrity Manager of De Beers. Her role is to protect consumer confidence in diamonds through implementing De Beers’ proprietary Best Practice Principles programme and to engage with various stakeholders to raise industry standards to protect the integrity of diamonds.

De Beers LogoNews headlines about Africa often focus on famine, poverty, drought, war, terrorism, migration, corruption and disease rather than a future full of promise.

Yet, since 2000, there are indications of ‘Africa Rising’, and the narrative is shifting to one where the continent is broadly destined to enjoy a period of mid-to-high economic growth, rising incomes and an emerging middle class as a result of improvements in governance, infrastructure, health and education.

Is Africa now on a steady path of economic growth, democratisation, opportunity and its own period of enlightenment?

That was the question the recent Association of Students of African Heritage’s ‘Africa Business Day’ event, held at Erasmus University in Rotterdam, set out to answer under the theme of ‘Redefining Africa’.

If the outcome of the discussions is any indication, this is indeed a time for hope over despair and opportunity over misfortune, a time for redefinition.

Under the supervision of a moderator from the BBC, tough questions were posed by an engaged student body to a diverse range of speakers.

The speakers included two entrepreneurs, one focused on building her own TV series for African entrepreneurs based on her own experience and one building new cities on the continent. There was also a digital marketing advisor from Google, plus an author and magazine publisher.

The vast array of problems facing the continent were discussed and we talked through some of the paradoxes on the positive steps that have taken place, reflecting how core challenges are still preventing these measures from reaching their full potential.

For example, more than 30 countries on the continent now experience power shortages and just one in five people has access to electricity in Sub-Saharan Africa. Yet there are 367 million subscribers to mobile phone networks, out of a population of 1.1 billion.

The exponential growth in mobile phone penetration on the continent has directly contributed to economic growth, particularly through the advent of mobile phone-based money transfer, financing and micro-financing services.

The average age of an African in 2012 was 19.2 years, the youngest in the world; and of the continent’s 200 million young people, about 75 million are unemployed. Yet, in the decade between 2005 and 2015, the economy of Africa as a whole increased by 50 per cent, in contrast with a world average of 23 per cent.

Africa’s entrepreneurial spirit is alive and thriving. According to the Global Entrepreneurship Monitor (2014), Sub-Saharan Africa is the region with by far the highest number of people involved in early-stage entrepreneurship activity.

The continent also leads the world in the number of women starting businesses, with almost equal levels of male and female entrepreneurs. In countries such as Ghana, Nigeria and Zambia, women entrepreneurs outnumber the men. De Beers has helped support this change through its mentoring schemes in Botswana, Namibia and South Africa.

In the last 15 years, the benefits of establishing entrepreneurial opportunities for individuals in the developing world through investment, private lending and capacity development have become evident, a clear indication that solutions from private sector development and investment can effectively support sustainable development against the historic approach of an aid-driven model.

Businesses, however small or large, old or young, have played and will continue to play a critical role in bringing economic development and stability to the continent – supporting skills development, creating jobs, and providing goods and services that will underpin economic growth.

De Beers is a global business, but also an African business. The majority of its diamonds come from the continent, and a significant proportion of those come from Botswana through its joint venture partnership with the Government of the Republic of Botswana.

Diamonds have contributed significantly to Botswana’s success, going from a poor, landlocked, water-stressed nation dependent on subsistence agriculture at independence, to being the only African country in the top 10 countries with the fastest growing GDP per capita between 1966 and 2014.

The Botswana-De Beers partnership is the largest single contributor to the Botswana economy besides government itself. As a result of beneficiation and seeking to achieve long-term strategic objectives, today every element of the diamond value chain is present in Botswana, from mining, sorting and sales, to diamond cutting and polishing, jewellery manufacturing, and retail.

Botswana was able to avoid the worst effects of the ‘resource curse’ (the paradox that countries with abundant non-renewable resources have been unable to use that wealth to boost their economies) because it has good governance systems, political stability and controls on corruption.

The country has been able to turn the value from its natural resource, diamonds, into real value for its population through infrastructure development, access to healthcare and investment in its education systems, and it is now seeking new opportunities for further diversification.

For more about the socio-economic impact of diamonds in Botswana and the Botswana-De Beers partnership, read this report: https://www.debeersgroup.com/en/reports/impact.html.

The continent is evolving faster than any other in history. Participatory solutions between government, African citizens and the private sector are the key to sustainable development.

De Beers has been in business for 128 years. If it wants to succeed over the next 128 years, it needs to continue to align its goals with that of its partners, and build on this strong foundation to create new areas of competitiveness, employment and value-adding opportunities for the diamond sector as a whole in Botswana.

As for the continent itself, it still faces some of its greatest challenges, but the stories and statistics speak for themselves. Africa is indeed still rising.