By Jeanine Mabunda *
If today the African brands preferred by consumers on the continent are those of companies such as “MTN, DANGOTE, DSTV, STANDARD BANK or ETHIOPIAN AIRLINES”; However, this only represents 14% of the 100 most admired brands in Africa. This demonstrates the long road and the still existing difficulty in building and promoting businesses and entrepreneurship everywhere in Africa.
Of course, the promotion of entrepreneurship has been at the heart of political discourse in Africa for more than a decade. It is part of the strategic development axes implemented by the African Union through its African Youth Charter, its Agenda 2063, its Action Plan on youth empowerment and the now former “One Million” plan. by 2021.” It is supported by programs of the African Development Bank such as the Multi-donor Fund for Youth Entrepreneurship and Innovation or the initiative Boost Africaan investment program covering the entire area of business creation. It is finally broken down into slogans and priority action plans on a national scale, particularly during each electoral period. Despite this, the situation remains bitter. Africa has the youngest population in the world, with 65% of citizens under the age of 35, but this potentially active population essential to achieving its demographic dividend is also the one most likely to be unemployed. In fact, it represents 60% of this category as a whole. Worse, of nearly 420 million young Africans, a third are unemployed while another third are in precarious employment and only a sixth is in salaried employment according to NEPAD.
The pitfalls on the path of an African entrepreneur are known: difficulties in accessing financing, cumbersome and inquisitive administrations, insufficient infrastructure, unfair competition and weak protection of the national economic fabric, lack and inadequacy of training, sometimes also cultural and social.
Even the champions in the field, like Aliko Dangote’s refinery project, are not spared. We are therefore still far from Africacapitalism as defined by the Nigerian businessman Tony Elumelu: the capacity of the private sector to create value and the creation by the government of an environment favorable to businesses. Each State therefore tries within its means and with the help of its continental and international partners to remedy this. However, my experience in the Democratic Republic of Congo, my country, also allowed me to identify essential but rarely included factors to integrate in the development of public policies intended to encourage entrepreneurship. As such, our last masterclass on the theme (Create, Innovate and Entrepreneurship in DRC ) around young companies on the subject, last September 23, 2024, in Kinshasa, reinforced this point of view.
The first of these is taking into account the time required to move from an entrepreneurial project, fragile by nature, to a company capable of formally evolving and competing on equal terms in its field of activity. Most of the public policies implemented in recent years have focused on the time required to create a business (in particular the deployment of one-stop shops in this area) as well as on access to primary capital. However, more than 50% of companies created go bankrupt before their third year of operation, notably due to failure to secure their cash flow through a sufficient order book or through credit. It is therefore essential, so that the energies and ideas deployed by these entrepreneurs are not wasted, that the State offers financing solutions, whether direct, through the creation of sovereign funds, or indirect through financing mechanisms. guarantees or participations in private venture capital funds, like the Innovative Fund for Start-Ups launched last April in Morocco.
The necessary time for support, training and sometimes mentoring, recognized factors of entrepreneurial success, most often carried out with private funds and through networking, should also be formalized, even institutionalized. For example, by developing tax incentives such as the tax credit for business training or a tax reduction for individuals who invest personally. Finally, the administration must create a legal and regulatory ecosystem that is sufficiently flexible to encourage companies to increase their critical mass, without fearing that threshold effects (especially fiscal and social) will suddenly increase their mode of operation and their costs.
Too often, too, public policies focus almost exclusively on urban areas and the sectors of the new digital economy and information and communication technologies. The logic is obvious: cities concentrate a young population, under the pressure of unemployment with the social and political risks that this can imply.
On the other hand, the need for innovative responses to everyday problems is pressing. Entrepreneurs, like Luka Pharma which helps to check the availability and price of medicines in all pharmacies in Kinshasa in a few minutes, undoubtedly provide essential solutions. Furthermore, all governments want a unicorn, a standard-bearing company that will symbolize their know-how in economic development and the modernity of their policies. In doing so, they neglect entire sections of their territory which nonetheless present significant entrepreneurial potential, particularly in the agricultural sector. Creating a business in Mbandaka in the equatorial forest does not happen like in Kinshasa.
Obtaining financing in Matadi, a port city in the Congo, is proving to be an impossible mission without a personal relay in the capital. In Africa, public budgets devoted to agriculture have fallen and are, in proportion to GDP, the lowest in the world, or around 0.5% according to the FAO. Entire sections of economic activity in rural areas are therefore in fact only supported by a few donor programs, such as l’Agripreneur at zero francs of the African Development Bank, which deserve more sustained support from public authorities, particularly as local relays. However, there is no shortage of initiatives, which combine production, agricultural processing and environmental protection, such as the project Farms for Orphans which enhances the hypernutritive capacities of mpose larvae or the industrial nacha specialized in the cultivation and processing of chili powder mixed with “organic” Congolese local spices. It is therefore necessary to carry out an essential diversification of public support programs, taking into account regional capacities, otherwise the disparities and distress of the populations will be aggravated, with the security risks that this can generate.
When it comes to financing, it is essential to pay particular attention to our African diaspora. With remittances reaching billions in 2023, our compatriots living abroad are seeking to invest economically and sustainably while maintaining strong ties with the continent.
An inspiring example in this sense is the new Senegal diaspora bank, an innovative neo-bank serving this diaspora. This model of financial coalition deserves to appear with more determination in the economic agendas of our regional institutions mentioned above.
Finally, entrepreneurship is not a miracle solution. Not everyone can instantly become an entrepreneur and succeed. On the other hand, there is no talent without opportunity. Public policies should therefore be oriented not by profile category, which is by nature difficult to determine, but rather present a set of integrated measures which make it possible to create an employment dynamic in which entrepreneurial profiles can flourish. With this in mind, there is a lesson to be learned from the results of the Emergency Program for Youth Employment and Integration deployed in Senegal from 2021 to 2023 (and renewed in 2024), Membership Hey. The latter, with a total cost over the period of 750 million dollars, focused on training, special recruitment of young people for public projects of community interest, highly labor-intensive public investment. work and entrepreneurship. The combination of its long-term efforts aimed at all economic areas, from security to culture, including agroforestry, has made it possible to create more than 80,000 jobs.
Each country faces its realities and must provide its own responses. But our continent also has regional, continental, economic, linguistic (French-speaking, English-speaking, Portuguese-speaking) and even legal networks serving a common ambition which can allow us to draw inspiration from similar experiences and spread solidarity and good practices. The key to entrepreneurship is also this: to connect, to be inspired, to adapt and to transcend.
* About the author
Jeanine Mabunda is a Congolese entrepreneur and international expert in public affairs, with recognized dual expertise: on the one hand, in the conduct of public policies, acquired through her political commitment and the exercise of high elective national functions; on the other hand, in the business world, particularly in the industrial, financial and banking sectors.
Deeply committed to providing African solutions to contemporary issues, she is particularly dedicated to the challenges of her country, the Democratic Republic of Congo. Jeanine Mabunda also plays a key role in promoting the energy transition, an area where the DRC occupies a strategic position, as well as in the fight against gender-based violence, particularly through her Foundation. Break the Silence.
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