Unemployment, independent of any other factor, threatens to derail the economic promise that Africa deserves. It’s a time bomb with no geographical boundaries: Economists expect Africa to create 54 million new jobs by 2020, but 122 million Africans will enter the labor force during that time frame. Adding to this shortfall are tens of millions currently unemployed or underemployed, making the human and economic consequences nearly too large to imagine.
Thus, even with the strong economic growth we have seen over the past decade, job creation in Africa remains much too slow. Africa needs a comprehensive, coordinated approach akin to America’s “Marshall Plan” in Europe after World War Two. That effort focused on building infrastructure, modernizing the business sector, and improving trade. By the end of the four-year program, Europe surpassed its pre-war economic output.
We can, and must, do the same for Africa. Entrepreneurs, politicians, philanthropic foundations, and development organizations — such as the World Bank, International Finance Corporation and USAID — must all work together to solve the unemployment crisis and make Africa an engine of growth. If we are outrun by the employment challenge, Africa will be a drag on global growth and resources for generations to come.
Africa’s Marshall Plan should prioritize three interdependent “pillars” of development, which all work together to form a virtuous cycle of growth: policy reform and a commitment to the rule of law; investment in infrastructure, and a commitment to developing Africa’s manufacturing and processing industries. This virtuous cycle forms the heart of Africapitalism: the public, private, and development sectors all coming together, united in a single objective of creating jobs and social wealth.
First, we need enlightened government policies that help reduce administrative and operating costs for investors and businesses. We must streamline licensing and permitting processes, reduce import duties and tariffs and ease visa restrictions, among other reforms. Such policies would do much to attract investment, increase entrepreneurship and ultimately generate jobs.