Inclusive and sustainable growth towards Africa 2030
Johannesburg, 7 October
EY launches a new report today, Africa 2030: Realizing the possibilities, in advance of the firm’s Strategic Growth Forum Africa that takes place at the Sandton Convention Centre, South Africa tomorrow.
This new report builds on EY’s flagship Africa attractiveness series, reinforcing the tremendous progress that has been made in Africa over the past 15 years.
Ajen Sita, CEO for EY Africa, says “Africa’s rise over the past decade has been very real. While there are still a number of sceptics, we have developed a robust data- and knowledge base to help provide quantitative substance to support the ‘business case’ for Africa; the evidence of Africa’s clear progress is irrefutable.”
“However, as important as it is to continue to provide evidence of the continent’s progress, it is perhaps more important to shift the focus towards the future of Africa, and what it will take to sustain and accelerate the progress we have seen over the past 15 years,” adds Sita.
With this in mind, the report also presents the perspectives of a diverse group of leaders with interests in Africa, providing points of view on what the future of Africa might look like, and what the drivers of change and critical success factors are likely to be.
Optimism is a sentiment coming through the various contributions, but this optimism is tempered by notes of caution. A consistent thread running through the contributions is the observation that intra-regional trade is substantially below what can be achieved, and that legislation and regulation still act as blocks to cross-border trade- a stumbling block that has to be removed to promote African prosperity.
Agriculture also receives attention, particularly the need to break down the barriers of traditional subsistence agriculture and then replace it with large-scale commercial operations capable of meeting the production objectives required by a continent in transition.
The depth of human resources, and the availability of a future pool of labour on a continent populated by young people, raised excitement and concern; excitement because of the availability of people to drive the African economy of the future; concern about the delivery of education and the creation of skills appropriate to growing economies.
However, the dominant view is that change is real. Economic growth and development will continue, and will be driven by a burgeoning African middle class with growing levels of discretionary income, growth in local entrepreneurship and investment in bridging the infrastructure gap.
One of the key factors, mentioned by many of the contributors, is the proliferation of mobile telecommunications, the convergence of technologies and the ability for these to drive forward financial inclusion, government efficiency, trading opportunities, and the delivery of education, healthcare and other services to urban and rural populations.
Whatever the differences or similarities in perspective, the point is that active dialogue and collaborative action is required to realise Africa’s possibilities. In this context, EY is promoting five priorities for action that will be most critical to a successful African future:
- Embracing shared value: The central premise behind creating shared value is that the competitiveness of a company and the health of the communities and economy around it are mutually dependent. It is a fundamental business philosophy that recognises that profit AND purpose can co-exist and be mutually reinforcing. For EY, a philosophy of shared value is underpinned by core purpose as an organisation – building a better working world – a working world with increased trust and confidence in business and capital markets, the development of talent in all its forms, greater collaboration across private, public and social sectors, and inclusive, sustainable growth at its heart; a purpose that is more relevant in the African context than ever before.
- Promoting partnerships: The relationship between government and business across many parts of the continent is not always as engaging and productive as it could and should be. Too often business is viewed as part of the problem. In contrast, government and business, both local and international, need to become partners both in embracing a philosophy of shared value and driving a common agenda of inclusive, sustainable growth. Partnership, co-operation and collaboration across the private, public and social sectors could be a powerful force for transformative change and growth.
- Fostering entrepreneurship: Entrepreneurs provide one of the main engines of growth in any healthy economy. They act as vital agents of change by developing new products and services, implementing more efficient production methods, and creating new business models and industries. Perhaps most importantly, small and medium sized enterprises (SMEs) will be the main drivers of the job creation required to realise inclusive, sustainable growth. For organisations genuinely committed to shared value and collaborative partnerships, the promotion of local content and enterprise development should clearly be a key business priority.
- Accelerating regional integration: With the shifting dynamics in the global economy, Africans have a unique opportunity to break the structural constraints that have long marginalized the continent. This will, however, only be achieved by driving greater regional coherence from the current patchwork quilt of 54 sovereign states. Regional integration and stronger regional institutions (such as the African Union and Regional Economic Communities) are key to promoting greater levels of regional investment and trade, because it will make it much easier and more efficient to conduct cross-border business, and will create markets with greater critical mass, coherence and density of economic activity.
- Bridging the infrastructure gap: Ultimately, though, regional integration will be enabled by sufficient investment in infrastructure; road networks, electricity access, telecommunications, and trade infrastructure (such as ports, highway corridors and railroads) will physically connect markets, reduce the cost of delivered goods, facilitate the mobility of people and products, remove productivity constraints, and enhance the overall competitiveness of the region.
Sita concludes, “It is clear to us that we Africans are presented with a wonderful opportunity to make a genuine difference in our working lives; the potential exists for us to be part of an African future that would have been virtually unimaginable a generation ago. The reality though is that this future is neither inevitable nor will it happen without active participation and commitment from multiple stakeholders. This is the time and place for us to collaborate to realise Africa’s future; it is our generation of leaders that can make it happen.”
EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities.
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This news release has been issued by EYGM Limited, a member of the global EY organization that also does not provide any services to clients.
Following on from EY’s successful integration in 2008 of 87 countries into one area from across Europe, Middle East, India and Africa (EMEIA), the firm has launched its Africa Business Center™ (ABC), which aims to enhance the effective and efficient links between its geographic reach and areas of expertise. The firm enjoys representation in 33 countries across Africa.