Founder, Tony O. Elumelu’s Opening Remarks at the JETRO Japan Africa Business Forum
in Yokohama, Japan
August 29, 2019
Good afternoon all,
First, I must thank Chairman Nobuhiko Sasaki of the Japan External Trade Organization (JETRO) for organising this important event, and I specially commend his team for all the effort put into a seamless conference.
Just January this year, I hosted Mr. Ishige, the previous JETRO Chairman, in Lagos, at the United Bank for Africa (UBA) headquarters, Africa’s Global Bank.
Mr. Ishige requested that it was imperative that I attend the TICAD 7 conference to promote a new message of trade and investment between Japan and Africa, and he was absolutely right.
I stand before you as Chairman of the United Bank for Africa, Africa’s global bank with presence in 20 African countries as well as offices in the United Kingdom, France and the only Sub-Saharan African bank with deposit taking license in the United States of America.
Earlier today I spoke at the TICAD 7 Plenary 3 Public-Private dialogue, and my message, which I will reiterate, was clear:
The new Japan-Africa partnership should prioritize three “pillars” of development, which all work together to form a virtuous cycle of prosperity:
- Investment in infrastructure,
- Partnership with the African private sector for the development of Africa’s manufacturing and processing industries to achieve increased local value creation;
- Investment in African youth to create employment and economic opportunity
This virtuous cycle forms the heart of Africapitalism: Africa and Japan coming together, united in a common objective of creating wealth and jobs.
Infrastructure investment, particularly in electricity and transportation, without which business cannot function, is of utmost priority because of its twin outcome of transformative impact as well as a stellar return on investment.
Today, more than 70 percent of sub-Saharan Africa lacks access to electricity. This is a glass that can be seen as either half full or half empty.
The vast number of potential consumers that are yet to be reached and connected to the grid, offers an incredible opportunity for investing in the power sector for discerning investors.
The social benefits are also immense: 1 percent increase in electricity outages reduces Africa’s per-capita GDP by approximately 3%. Access to affordable electricity is essential to unlocking the continent’s growth potential — reducing costs and enabling business growth, including homegrown businesses that create jobs and sustainable local economies.
Investment in transportation infrastructure also promises to have an equally transformative impact for investors.
Consider that today in Africa’s largest economy, Nigeria, despite President Buhari and the Central Bank Governor’s genuine commitment to agriculture development, 65% of agricultural produce spoils for lack of storage infrastructure and adequate transport connections.
This is an opportunity for investment in the transport space to connect the continent and enable more exports to other African markets via roads, railways, waterways and airways.
Major multinationals are ramping up African operations in spite of “infrastructure challenges” because they know and understand that the benefits far outweigh the negatives.
For the second pillar, investing in and building the manufacturing and processing industries in Africa, offers an attractive opportunity to access, process and refine Africa’s natural resources here on the continent.
Africa needs more local value creation.
The continent has an abundance of natural resources ready to be transformed into higher-end products on the value chain.
- To give a few examples: Africa is home 12% of the world’s oil reserves, 40% of its gold, and 80% of its chromium and 90% of its platinum respectively.
Africa is also home to 60% of the world’s underutilized arable land and has vast timber resources.
The idea that these abundant natural resources can be the driver for an industrial revolution across the continent is growing.
See this therefore as an opportunity to practice what we preach with Africapitalism, of partnering with Africans to invest in key sectors beneficial to the continent, but also profitable for your business.
It will be a highly profitable venture for businesses who enter these sectors to create local value internally, instead of shipping raw materials such as oil, cocoa and gold overseas, where they are processed into high-margin products and often re-imported into Africa.
On the third pillar is investing in African youth to create employment and economic opportunity, it is very well known that Africa is a continent of people that are extremely entrepreneurial in nature.
We have a young and growing population with many brilliant ideas for innovation, growth and improving quality of life, while reducing unemployment across the continent.
Investing in these small businesses is akin to investing in silicon valley startups; they have the same levels of passion, intellect, skill and capacity to transform your capital into wealth.
They have the resilience, doggedness, and determination and a mindset of success against all odds that their counterparts in other parts of the world may not have developed yet.
Though this young population is hampered by several obstacles: access to capital, training, mentor networks, overly bureaucratic institutions, problems of power and infrastructure among others, they remain incredibly optimistic and determined to succeed despite the odds.
I, as an entrepreneur myself, am keenly aware of the struggles of being an entrepreneur in Africa, and the amount of courage it takes to build a startup, to turn an idea into a business.
And now as a philanthropist, through the Tony Elumelu Foundation, we are helping to alleviate these challenges by equipping and empowering these young entrepreneurs with the capital, tools, and skills for their businesses to thrive.
Through the Tony Elumelu Foundation, we have committed US$100 million over 10 years to empower 10,000 African entrepreneurs across the continent and create 1 million jobs and add $10 billion in revenue to the African economy.
Just five years into the programme we have empowered over 7,500 beneficiaries and counting.
This presents a unique opportunity for collaboration between Japan and Africa, at both the Government and company/individual levels, to help invest in the real future of Africa which is our young ones.
The good news is that the world is listening that the biggest asset we have in Africa is our people – and what we do at the Tony Elumelu Foundation is a testament to the transformative power of entrepreneurship.
Indeed, the investment in these young Africans is the most impactful investment you can make.
At the recently held Africa Union Summit in Niger, the Tony Elumelu Foundation and the United Nations Development Programme (UNDP) announced a new groundbreaking partnership to empower 100,000 young Africans. This is – bold; audacious; transformation.
And all of us here at the JETRO Japan-Africa Business Forum can do more!
One of the ways JETRO can also participate in empowering our youth, the engine of Africa’s future, is to partner with credible local partners such as to deploy the Tony Elumelu Foundation Entrepreneurship Programme as a tried and tested model for the new Japan-Africa partnership.
The Tony Elumelu Foundation Entrepreneurship Program is holistic in nature and targets all aspects of the entrepreneurial value chain
- It consists of non-returnable seed capital of $5000, business management training, mentoring, country meetups across the 54 African countries, membership to the dynamic TEF alumni network, the largest database of African entrepreneurs; and access to TEF Connect, the largest digital networking platform for African entrepreneurs.
TEF Connect, which launched under a year, already has close to a million young African entrepreneurs as subscribers, actively trading, engaging, learning and growing. This database also offers an attractive pipeline for your businesses and I encourage you to sign up.
We encourage your companies and agencies to invest in Africa, in this youthful energetic population and their ideas, and see this young pipeline as an opportunity for investment, knowledge sharing and training on global best practices.
Indeed, these entrepreneurs and their businesses demonstrate over and over again that there is no better time to invest in Africa than now.
Last month was a demonstration of the possibilities offered by a united Africa when we convened Presidents, African entrepreneurs and leaders across the continent and globally at the Tony Elumelu Foundation Entrepreneurship Forum (TEF Forum).
It was a truly powerful image to watch our young African entrepreneurs engage directly with their Presidents and leaders. A strong message was transmitted: Africa is united to move forward.
In 2016 during the TICAD conference in Kenya, Japan pledged $30 billion for Africa over three years. Plus this year’s $20 billion – $50 billion
10% of this is $5 billion, while 5% is $2.5 billion!
If we invested only 5% of this $50b fund in African youth, by just adopting the TEF model, we would have touched 500,000 lives across the 54 countries, broadening markets, facilitating job creation, improving income per capita and transforming lives.
Let us make this 2019 JETRO Japan-Africa business summit count for African youth by dedicating a percentage of the total sum to be announced at the end of this conference, to be directly invested in African youth.
I welcome the discussions that we will have during the conference and look forward to a future of stronger economic ties between Africa and Japan.