You’ve heard the phrase, "Africa is going to leapfrog developing economics because of technology."
If you haven’t, it’s something that’s been flung out there for the past 10 or so years.
"It’s the next big market! With over 1 billion people and growing—Africa is the next frontier of technological advances."
There’s truth in all of those statements. But let’s set the stage first before we get there...
Yinka Adegoke writes, "The successes of mobile money in East Africa and the expansion of 4G networks across Africa has led to discussions of the continent leapfrogging the typical growth that more advanced economies saw over the past few decades. Can Africa leapfrog normal development phases due to rapid, technological advances?”
He then points to Harvard professor Calestous Juma's article Leapfrogging Progress, The Misplaced Promise of Africa’s Mobile Revolution. In this article, Juma gives lots of data and research to validate his premise.
The main point is that there are zero shortcuts when it comes to building anything—a life, a company, and most certainly a nation. Africa cannot and should stop thinking that it could leapfrog progress.
There’s a number of fascinating case studies in the article. They point to the fact that no advanced economy got where it is today by cutting corners and sidestepping (or leapfrogging) industrialization.
"Infrastructure is both the backbone of the economy and the motherboard of technological innovation. African countries need adequate infrastructure to realize their full potential."
Entrepreneurship and technology are wonderful things and have the potential to continue solving many problems. But without the policies, procedural reforming, and mindset shifting, Africa can’t leap forward with much thrust.
Adegoke continues, "In [Juma’s] view, the failure of the mobile revolution is that while it has worked in opening up communications for tens of millions of ordinary African consumers it hasn’t established an infrastructural base for economic development. African policymakers need to learn this lesson if they really want to promote innovation in their countries.”
We must shift our thinking from generating raw materials to creating products and services that can be sold globally.
- The East exports raw materials from Africa and creates mobile phones and sells them back to us.
- The Europeans use Africa’s cocoa and sell them globally with massive upsides.
- The West loves Africa’s coffee (and oil, lumber, and most talented people).
There’s nothing wrong with all of this—it’s how this global economy works. But we have to understand this fact and begin to create companies with grander visions, larger reaches (which is available today through tech), and open minds that can partner with other regions without the fear that partnership often brings us personally.
In order to act on this, we need industries developed locally first. And that starts with newfound policies. The wheel doesn’t have to be re-created here. There are many case studies of nations turning this around (Juma references Taiwan in Section 3 of his paper. Other nations that turned around: South Korea, China, Germany after WWII, etc.).
"There is little evidence to suggest that countries industrialize by adding value to their raw materials. Rather, the causality runs the other way—countries add value to raw materials because they already have local industries with the capacity to turn raw materials into products. Initial industrial development thus becomes the driver of demand for raw material and value addition rather than the other way around.”
The men who built America are known for their different level of thinking (Rockefeller, Carnegie, JP Morgan, and others). All of these people pioneered something by changing the way their local industries saw the problems. They then opened the door to entire markets to be shifted and created.
If it’s true that Africa cannot leapfrog infrastructure and industrial development, then we must ask ourselves, who will be the Rockefellers and Carnegies of our nations?
(photo via rod waddington)