Onshore and Restore: Africa’s Century
Recently I was reading the compelling “Reshore and Restore” article shared by David Ulevitch and Grant Gregory, and it got me thinking about an African century and how the continent itself should also create resilience using technology, so as a riposte I wanted to write my thoughts about how I view this from an African startup perspective.
In a world that prizes adaptability, innovation, and perseverance, it is the rich tapestry of Africa's history that exemplifies these qualities in the face of adversity. While it is true that overcoming hardship is often the lens through which the continent is viewed, it is also essential to acknowledge Africa's potential for adaptation and innovation. As if echoing the gilded age of America's oil barons and railroad magnates, a new epoch has dawned. Thus, as investors and entrepreneurs, we must seize the unparalleled opportunities to reshape this vast and varied continent.
In the cradle of humanity, a land teeming with natural resources, Africa stands on the cusp of a pivotal moment in history. Though constrained by inefficiencies in infrastructure and domestic manufacturing, we have the singular chance to learn from other nations and vault into the future. As the golden age of American railroads exemplifies, the power of visionary investors can be harnessed to address pressing issues. So, let us ponder: What if we, as investors and venture capitalists, were to become the agents of change? What if we directed our efforts towards supporting sustainable solutions and innovative technologies tailored specifically for our distinctive African context?
To truly foster innovation, we must turn our gaze inward and promote onshoring, embracing techniques such as domestic manufacturing and in-house production to build a robust ecosystem that nurtures home-grown ideas and talent.
Africa, a vast canvas of cultures, landscapes, and untapped potential, can rise above its challenges and lay the groundwork for generations to follow. Consider agriculture, for instance. Africa is endowed with an abundance of arable land, yet food security remains a pressing concern. According to the World Food Programme, more than 278 million Africans grapple with chronic hunger, a situation exacerbated by the COVID-19 pandemic.
The solution lies in embracing cutting-edge agricultural innovations like hydroponic and aquaponic farming. If we can cultivate plants in nutrient-rich water, hydroponic systems will enable us to maximize crop yield and optimize resource utilization. Aquaponic systems, on the other hand, merge hydroponics with aquaculture, creating a symbiotic relationship between plants and fish that fosters a sustainable and efficient food production ecosystem. By evolving from traditional methods, we can pave the way for prosperity.
We should also recognise that, in a time when many Africans are experiencing food insecurity, technology and digitisation must be harnessed to make a positive impact on agriculture. Onshoring these techniques will optimize the use of our land, water, and other resources, leading to higher crop yields. If we leverage data-driven farming practices, a more productive and efficient agricultural sector can be created. Turning Africa into the solution for global food security instead of the focus of food insecurity.
Take the collaboration between Microsoft and OCP Africa (a subsidiary of Morocco's leading phosphate and fertiliser giant, the OCP group), which uses precision agriculture such as data, sensors, and satellite imagery to optimise crop production. This method heralds a significant improvement in the way we manage our resources, resulting in increased food security. Digital platforms can enhance supply chain management in our agricultural ecosystem, allowing for more precise tracking of payments and seamless information exchange between farmers, suppliers, and customers.
In this current era of rapid technological progress, Africa has emerged as a promising landscape for innovation and development. One area where digitisation can significantly contribute is data-driven platforms, particularly in regions where data has historically been difficult to find and verify. According to a GSMA report, 515 million people subscribed to mobile services in Sub-Saharan Africa, accounting for 46% of the population. By 2025, this mobile penetration is projected to reach 50%. The emergence of these platforms presents an invaluable opportunity for Africans to access vital empirical data, offering a wealth of insights and knowledge at their fingertips.
Consider the case of M-Pesa, a mobile money platform that has revolutionized the way people in East Africa conduct financial transactions. By using mobile phones as a payment tool, M-Pesa has enabled people to send and receive money, pay bills, and access credit, all from the convenience of their mobile devices. Leveraging growing mobile penetration rates, fintech platforms have achieved greater financial inclusion, making it possible to incorporate a growing population of those who were previously unbanked.
Disruptive technologies like Kenya's Ushahidi platform exemplify the potential of data platforms in Africa. Ushahidi allows users to crowdsource and visualize real-time data on a wide range of issues, from crisis response to election monitoring. This demonstrates how data access can transform the continent, enabling African countries to enhance decision-making processes, improve resource allocation, and foster transparency and accountability across various sectors. The future prospects for data platforms in Africa are enormous. The growth of e-commerce, fintech, and other data-driven industries is set to accelerate rapidly, driven by the increasing adoption of smartphones and the internet. Moreover, disruptive technologies such as artificial intelligence, machine learning, and blockchain hold immense power in unlocking the stored potential of these data-driven applications.
Another area with huge potential is manufacturing. The African Continental Free Trade Area (AfCFTA) is a transformational step towards promoting intra-African trade and fostering regional economic integration. As the largest free trade area in the world, it presents an unprecedented opportunity for African countries to strengthen their manufacturing capabilities and capitalize on the wealth of human and natural resources within the continent. Africa is teeming with youthful energy, boasting the world's youngest population. As investors and leaders, it is our responsibility to create an environment where our younger generations can thrive, innovate, and contribute to Africa's future. To be major players on the global stage, African nations must strengthen their economic prowess by shortening supply chains and emphasizing the adoption of onshoring business techniques.
To embark on this journey, we must be selective and strategic about the technologies we adopt. As witnesses to the technological revolutions unfolding in other countries, we can cherry-pick the most relevant and transformative ideas to propel Africa forward. This analysis allows us to avoid the pitfalls and challenges faced by other nations and carve our path towards sustainable growth and development. The silver lining of all African problems comes in the form of perspective. Developed continents ventured into digitisation territory, benefiting and learning from the rewards and challenges that came. However, Africa, as a latecomer, must learn from the successes and failures of its older siblings to make more well-informed decisions.
For this, we look to the east, specifically Singapore. The economic growth and trajectory of Singapore serve as an encouraging case study for African nations, demonstrating the transformative power of strategic planning, investment, and commitment to developing local industries. Within a few short decades, Singapore transformed from a small, resource-poor nation into a thriving global financial and technological hub. Key to this success was the prioritization of infrastructure development, embracing free trade, and nurturing a business-friendly environment. In saying "yes" to these changes, Singapore managed to rapidly industrialize, diversify its economy, and build a robust manufacturing sector that spans electronics, chemicals, and biotechnology.
There is huge potential in biotechnology for Africa. Just imagine the transformative power it could have on healthcare, agriculture, and environmental conservation across the continent. Africa's unique biodiversity presents a treasure trove of untapped genetic resources, ripe for harnessing in drug discovery and development. By integrating disruptive technologies such as artificial intelligence and machine learning, we can significantly accelerate Africa's growth trajectory.
Consider the recent acquisition of Tunisian-born AI startup InstaDeep by BioNTech. This merger showcases a glimpse of what the future could hold for Africa. By embracing onshoring manufacturing and production techniques, African nations have the potential to become global leaders in exporting biotechnology, pharmaceuticals, and personalized healthcare treatments.
Moreover, Africa's abundant renewable energy resources present a wealth of opportunities for the continent. With its vast solar, wind, and hydro capabilities, Africa has the potential to leapfrog traditional energy infrastructure and emerge as a global leader in clean energy production. By investing in renewable energy projects and creating sustainable power sources, we can not only reduce our carbon footprint but also generate employment opportunities and stimulate economic growth.
As we enter Africa's golden era, we find ourselves presented with a unique opportunity. African investors, visionaries, and leaders have the chance to shape the future of the continent, and the prospects are bright. Africa's perceived weaknesses are, in fact, blessings in disguise. Recent global events have revealed that Western offshoring practices, the profit-and-loss mentality, and the migration of critical industries to other regions are neither sustainable nor in Africa's best interest.
By learning from these mistakes, we can develop simple yet effective solutions tailored to the unique challenges we face. Instead of relying on outsourcing, we must focus on onshoring and building an economy that is resilient, competitive, and forward-looking. Guided by our own vision and built on our own terms, we can adapt and innovate to change our narrative. In doing so, we will forge a truly African continent that stands strong, dependent on its own strengths, resources, and capabilities.
I look forward to both participating and observing these changes over the next decades. It has been a pleasure so far to be involved in so many interesting projects and companies, and I look forward to whats coming next.