I’m going to challenge some of the myths and assumptions about Africa. Despite its undoubted poverty and hardship, Africa is also a continent of innovation, enterprise and opportunity. A continent where there are inspiring individuals who want to change things and where those who want to improve the lives of the poorest in the world, as well as making money, should be clamouring for opportunities to invest.
Let me start with some context. It is too real a truth that Africa faces great challenges. There’s a drought in the Horn where the rains have failed for the second year running, a crisis in Zimbabwe, a new state to be built in South Sudan, piracy off the coast of Somalia, and International Criminal Court investigations in Kenya. Growth – where it has occurred – has at times ingrained inequalities, particularly for girls and women. Extractive resource industries have often fuelled conflict. And the statistics on deep and unremitting poverty speak for themselves: 250,000 women dying from causes relating to pregnancy each year; 330 million people without access to safe water; 565 million people without access even to a basic pit latrine.
These very real challenges illustrate just why this government has a substantial development programme in Africa. British aid and debt forgiveness have, over the years, helped many African economies to stabilise and grow. Now, the coalition government is refocusing its aid programme to fuel the engine of development – the private sector – to help provide Africa’s poorest people with the means to create their own
wealth. We’re doing this because Africa’s long-term prosperity – and the achievement of the Millennium Development Goals – depends not only on aid or charity but also on sustained economic growth.
Just a decade ago Africa was a continent of low or no growth. Today, it has six of the ten fastest growing economies in the world and it is growing
faster than the OECD, Latin America, Eastern Europe and the Middle East. In short, Africa is a place of huge business opportunity. To those who say they’ve seen future dawns before in Africa, I say that it is the quality of its growth over the past decade that is profoundly different.
It’s no longer focused only on the commodities sector as in previous booms. Less traditional areas, such as the retail and financial sectors, are attracting more interest. Twenty African companies can now lay claim to revenues of at least $3bn, while small and medium-sized African businesses are seeking new openings. The changes in the business climate and opportunities are accompanied by other change too. Across the continent there are some inspiring stories of democratic and political progress. Twenty years ago, presidents could rely on being in post for
life and kleptocracy was the norm. Today, far more leaders are appointed through contested elections, not least thanks to the adoption of the Harare Principles by the Commonwealth Heads of Government in 1990 when John Major was prime minister.
Just in the space of the past year we’ve seen credible elections in Africa’s most populous nation, Nigeria; the adoption of a new and improved
constitution in Kenya and the birth of a new nation, as voted for in a broadly peaceful referendum in South Sudan. This is an important moment.
Africa has reached a crunch point, because if it is to continue on this upward trajectory, its growth has to be intensified, deepened and broadened.
As a minister, I know that my duty to taxpayers provides an imperative for the government to help stimulate growth in Africa. Helping create a prosperous, stable and secure continent is not just a nice thing to do, though I do believe it’s the right thing to do. It’s also firmly in the UK’s interests.
I want to see companies going out of their way to find local producers, to create local supply chains, to engage local communities.And I want
to see more partnerships with the indigenous business community within Africa. This approach is as good for business as it is for Africa. The more deeply enterprises can embed their practices locally and regionally, whether through jobs or partnerships or trade, the more sustainable – and profitable – those businesses will become.
In Lagos, I met a businessman, Christopher Anick, who was selling air conditioning units. Like other shopkeepers he’s just found it too difficult to take time out to go to the bank. Now, thanks to a system called E-susu – which DfID part-funds – the bank comes to him instead. As a result, he’s been able to borrow £500 to develop his company and to send his two children to school. It’s thousands of small businesses like these which can make such a difference to Nigeria’s economy and help to provide a secure platform for its future prosperity.
This coalition government is working to make it easier for companies to do business in Africa, thus creating more opportunities for poor people.
Take a step back for a moment and you’ll get a better perspective on the sheer scale of Africa’s potential. The opportunity is immense. This coalition government’s commercial diplomacy agenda will help identify those opportunities. Its 14 UK Trade and Investment offices and its missions across Africa are supporting British businesses. We’re also supporting emerging African businesses because we know that small and
medium enterprises are the key to job-creating growth. The new UK-South Africa Business Forum, agreed recently, will connect business leaders
and deepen links between future generations of UK and South African entrepreneurs.
At DfID, we are addressing some of the blockages that are the biggest deterrent to investment. Here are just a few examples: We’re investing in Africa’s most precious resource – its people. By 2014, UK aid to Africa will get another 5 million children into school, protect 30 million people from malaria, and provide 14 million people with access to clean drinking water. Sick people and mothers with sick children can’t work and won’t be economically active.
We’re also working with governments to reduce start up times, as in Ghana where instead of taking ten weeks to register a business it now takes under two. We’re helping refine legal systems, providing support to the new commercial courts in Uganda and Nigeria. We’re tackling corruption head on, improving public financial management, promoting transparency, and funding anti-corruption units within the Metropolitan Police and the City of London Police. We’re addressing the vital issue of property rights, supporting the land reform that can unlock economic growth and empower women by enabling them to borrow. Women represent 70 per cent of agricultural labour across Africa but own only 1 per cent of the land. We’re helping to provide secure tenure for the vast majority of adult Rwandans who own land – a total of some 10 million plots.
When people talk about doing good in Africa, they tend to think of women and men in T-shirts handing out food and medicine. I’m the first to say that these are some of the heroes of the modern world. But well-directed action by people sitting in boardrooms can improve the lives of people in Africa just as much as aid workers and charity campaigners can.