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Africa’s Untapped “Natural Resources”

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According to the mainstream media, Africa is at the dawn of an economic golden age. The African Renaissance is no longer the ambitious dream of a former South African statesman but a reality. This is progress.

But…

I have a problem with the nature of the winds of change sweeping through the continent – it lacks a human element. Week in week out you’ll come across some news about many African nations or institutions hosting investment summits, whether at home or abroad. 90% of the time the core topic of these gatherings is either about a.) investing in infrastructure or b.) investing in extractive industries such oil/gas extraction and mining. The focus of the remaining 10% is essentially talk shops – by mainly Western nations playing catch up to China – on how to stimulate and further penetrate the continent’s fast growing consumer market.

I have yet to see/read/hear about a major summit, in the mold of those mentioned above, where the objective is to crowd in major players in the domain of human capital development.

I believe Africa’s most valuable natural resources are its people. To lay the foundation for a prosperous future we should – at the minimum – pay as much attention to developing in Africa’s people, as we do to developing its natural resources.  The difference between the value of an ounce of gold and a gold Swiss luxury watch is human energy.  A continent with a critical mass of individuals equipped to unleash their talents will radically, and sustainably, transform Africa into a much better place. These individuals will be able to efficiently operate the infrastructure under construction, and meaningfully participate in developing the continent’s future high growth industries.

The current focus on the extractive industries is unsustainable and is a lazy approach to developing the continent. An over reliance on these industries also exposes African states to potentially negative “black swan” events beyond their control. The price of oil collapses in commodity trading markets and suddenly a rapidly growing economy’s government faces a budget funding crisis. A banking crisis on another continent precipitates a liquidity crisis; the automotive industry sees falling sales and suddenly a once booming platinum mining industry in South Africa loses its biggest customer, pushing the entire platinum mining industry to the brink of collapse.

Juxtapose that scenario besides another where the continent benefits from the talents and industry of its professionals and entrepreneurs. With a sufficient skills base, Africa can quickly respond to problems; diseases like Ebola are reduced to isolated cases as opposed to them becoming epidemics threatening entire regions of the continent. Africa’s diversity is its biggest strength; with its technologists and entrepreneurs empowered, new ideas and different perspectives can be brought to light in solving problems in innovative ways. These ideas are not only limited to the continent but can be applied worldwide. South Africa’s synthetic fuel technology does not only address the country’s energy needs, but through Sasol and PetroSA its now in operation on 3 other continents.

I believe Africa has an opportunity to radically transform itself. However, our obsessive focus on mineral resources just perpetuates the same pattern which saw the continent being plundered throughout the 19th and 20th centuries. We should make a total 180-degree turn in our mindset and realize that Africa’s prosperity lies in its people being equipped to thrive and not just survive.

 

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