A call has been made for African countries to stop looking for, relying on, and waiting on foreign investors and instead switch focus to encouraging other Africans to invest in the continent. This call has been made to Africans and other Black people, not only in Africa, but around the world.
A challenge has been made against the old model of the European or non-African investor that arrives in Africa, spends a pittance in setting up shop, mine our minerals and leave with the raw material to his country of origin without making an impact on the lives of the people and the environment the minerals were extracted from.
Historically, non-African investors from mainly Europe would arrive and make all kinds of promises aimed at securing their mining contract. However, upon getting what they want, they soon close shop and leave the country without fulfilling their corporate social responsibility to their communities of operation. There is also a historical practice of foreign investors using fake documents and not caring enough about the needs of the communities and the populace. The foreign investor will come with his fake documents and substandard equipment spending the barest minimum for him to reap maximum benefit from the hard working African employee. The foreign investor will not have the same love, respect and consideration for the people and community he or she is involved in as the African investor.
All this has led to calls for African governments to cut the ties that bind them to foreign investors, who have over time shown that they don’t care about the people and communities they operate from. But by encouraging Africans to invest, there is the expectation that the African investor or government will know his people, hence will be more likely to respond to the needs of the community than the foreign investor whose sole focus is on the profit he stands to make.
It has been noted that many foreign investors come to Africa using forged or fake documents, a pattern that is a continuation of our experience as colonies of our European masters.
Therefore, to encourage African investors instead of solely relying on foreign direct investment (FDI), African nations should focus on strengthening intra-African trade and investment through initiatives like the African Continental Free Trade Area (AfCFTA), which would also involve creating a more favourable business environment for African businesses, promoting local entrepreneurship, and ensuring that local investors have access to capital and resources.
While there are many and documented ways for African governments to stop relying on foreign and encourage local investors, by focusing on the following the continent stands to reclaim its former position as the nation the whole world streams to for all their needs. Africa has everything the rest of the world is searching for.
The first move to encourage Africans to invest in their nations and the continent would be to strengthen intra-African trade and investment. For example, AfCFTA, which aims to create a single market for goods and services in Africa, fostering cross-border trade and investment, should be weaponised to reap maximum benefit.
Africa must as an existential necessity for the survival of the continent reduce trade barriers and work towards eliminating trade barriers within the continent to facilitate intra-African trade. The continent invests more in other continents and countries than it invests in itself. This model will have to change if we are to address the historical anomaly of African governments and people always ending up on the receiving side of trade and investment agreements.
Although African governments are not known for working together in the interest of the continent, they are encouraged to promote regional integration if we are to expect for there to be a rise in the number of African business people and or governments to increase their investment footprints across the continent. There is every need for African investors to push for cooperation and collaboration among African countries aimed at building common infrastructure and markets. This calls for the acceleration of the federation of the African continent, a dream that is marketed as the solution to the problems affecting the 54 independent African nations, the majority of whom cannot support their own government’s budget.
Like love, business deals are based on attraction; an attractive mineral in an attractive business and legal environment. African governments should review their investment laws so as to improve the business environment while encouraging other Africans to invest by removing bottlenecks and other impediments.
If there is a common problem with doing business in Africa that discourages other Africans from investing in the continent is bureaucracy, which is like an onion with layers upon layers of unnecessary rules and regulations that act as hindrances to attracting African investors.
There is the need them to streamline regulations, simplify bureaucratic processes and make it easier for other African businesses, both local and on the continent, to operate across Africa.
For a long time, African presidents have bend over backward to attract foreign or non-African investors. This addiction made the investment field uneven for the African investor. Now that things have changed and the world is waking up, African governments must ensure a level playing field for other Africans to invest. This is done by implementing policies that ensure fair competition and prevent the dominance of foreign businesses.
There are other ways for African governments to encourage Africans to invest in the continent not limited to the protection of intellectual property rights. Strengthen legal frameworks to protect intellectual property and ensure that African businesses can benefit from their innovations will encourage citizens and those from the diaspora to take an active interest in investing in Africa.
When African countries take loans from IMF and World Bank they are leaned on to remove measures aimed at alleviating the plight of the people. They do this to make sure their loans are repaid, but at the cost of hardship and extreme difficulties for the people and state.
Therefore by promote local entrepreneurship through the support of local start-ups we can start encouraging locals to take an active role in investing in the country and on the continent via the creation of programmes and initiatives to provide financial support, mentoring, and training for local entrepreneurs.
Africa will be the continent of choice for other African investors if African governments invest in education and skills development. By ensuring that African youths have access to quality education and vocational training will not only build a skilled workforce, it will encourage them to focus using their skill and training for the betterment of the nation instead of wanting to emigrate to greener pastures.
Although the continent is ripe for investment however we still fail to reap maximum benefit because we have failed to innovate and promote innovation. Our mineral sector is today not making the kinds of returns it should because we lack equipment, technology, training, and money. African governments must promote innovation through supporting research and development activities to foster innovation and create new industries.
Lack of finance remains a hindrance to the progress and prospects of the African investor. To encourage them will be to ensure their access to capital and resources. African regimes will encourage investors from within Africa by developing the local financial markets. This is accomplished through the strengthening of local banks and financial institutions to provide access to credit and investment for African businesses. They can go further by creating an environment that attracts private equity and venture capital firms that are willing to invest in African start-ups and SMEs.
While there is every need to encourage more African businesses and people and governments to invest in the continent, this call will be heeded if at the local level we are seeing proof of this new way of thinking. Therefore African governments must implement laws and policies to encourage local investment.
By investing in Africa the African investor is not only ensuring the survival of the continent they are also changing the dynamics of expectation: the expectation that we need foreign or non-African investors for our businesses and countries to survive. We now know that by focusing on sustainable development and making the investment environment friendly for other Africans to invest the continent can start her long awaited rise back to the top of the world economic, political, and social order.
In closing, if African governments are to make Africa friendly to attract African business people to invest they must: prioritise investments in infrastructure and renewable energy, which investments can create jobs, stimulate economic growth, and reduce the environmental impact of development; promote sustainable agriculture by investing in technologies and practices that can improve agricultural productivity and reduce the impact of climate change and; focus on green technology by promote the adoption of green technologies and renewable energy sources to reduce greenhouse gas emissions and create a more sustainable economy.
By implementing these measures, African countries can create a more attractive environment for African investors, reduce their reliance on foreign direct investment, and build more sustainable and equitable economies. Therefore, instead of working and saving all their hard work in foreign banks and economies, Africans are being encouraged to invest in the continent, going as far as moving back to the continent with their western training, money, and experience. However, the onus is on the side of African governments who are expected to create the level playing field for this to happen.