Many still see Africa as a continent bedeviled by volatility. Although clear-eyed about considerable variations across countries, former Nigerian minister of finance Ngozi Okonjo-Iweala remains convinced that these views aren’t always in line with reality. Here, the Nigerian economist explains signs that business is picking up and looks at opportunities in engaging and empowering Africa’s women in particular. An edited transcript of her remarks follows.
Interview transcript
When I look at some of these dynamics—the consumer base; the young, dynamic population; the natural-resource base that we have—I think to myself that businesses need to look at this and not at the short-term volatility that they see on the continent.
Navigating Africa’s volatility
Many of those who invest on the continent will say that when you take risk, the returns are also significant. I mean, businesses have talked of returns that can be up to 30 percent, for instance. I happen to believe, yes, there are risks. Let’s not get away from that.
But I also think that some of this risk is exaggerated, that there is a perception of risk beyond what the actual risk is. Businesses need to look carefully and see what are the real risks and how can they hedge these risks, because I think some of them can be managed and [companies can] plan for the long term.
Africa’s improving business environment
We should be careful not to generalize too much. You know, we’ve got 44 or 45 sub-Saharan African countries, 54 countries on the continent, and it does vary from country to country. Some countries are better off than others.
But in general, I have seen the business environment improve. Why am I saying that? We’ve got African businesses also investing in Africa. And they’re pushing. So, you’ve got South African businesses invested in Nigeria, Tanzania, Zambia, and Nigerian businesses investing in East African and West African countries.
African leaders are also realizing that improving the ease of doing business is not just about people coming from outside the continent. It’s not about foreign direct investment only. It’s about encouraging your own local investors and African investors.
The more our businesses within the continent can show the way, and the more policy makers can realize that they need to open up, the more we’ll be able to attract outsiders. So, in short, it’s evolving, it’s opening, but I think we have a long way to go, if I’m to be honest.
Africa’s overlooked business revolution
Empowering Africa’s women
When we talk about the role of women on the continent, if you look carefully, you see that women are engaged strongly and heavily in the economy. [That’s] all the way from informal enterprises, small and medium enterprises, to the agricultural sector, where they provide 60 to 70 percent of the labor in most countries, to owning medium-size businesses.
Some of them are also working now in the formal sector as leaders and CEOs. But there are very few at this point in time, very few. We need to fix that. But we [can] look at the economy as a whole. Let’s just take Nigeria, for example: we have about 32 million small and medium enterprises, and 50 percent or more of those are run by women. This is where jobs are created.
And that is why it is important, when you’re designing your business, that you look at your supply chain and say, “Am I engaging with these women?” Because if I empower them, I’m going to get connected to a good chunk of society.
I’m talking of it is a business proposition, that women are there in the economy. They are providing value. They work really hard. They are reliable. And therefore, if you’re a business, you must engage the women.
