Management and industrialisation in Africa

Forum Afrique2017-Visual Identity - FR-3

By Daniela Scur and Nicolas Lippolis, University of Oxford


Learn more about this timely topic at the upcoming
17th International Economic Forum on Africa
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Africa-IndustrialisaionThe manufacturing sector has traditionally been seen as an engine for development due to its high propensity for productivity gains. Worryingly, recent evidence suggests that this has not been the case in Africa.1 One important determinant of firm productivity is the quality of management practices, and new data sheds light on the state of management in some African countries.

Management around the world

For over 12 years, the World Management Survey (WMS) has been collecting data on management practices using an interview-based methodology. It defines 18 key management practices and scores them from worst practice (1) to best practice (5). The focus is on such practices as monitoring, target-setting and incentives/people management. Research using this data suggests a strong correlation between management and a series of productivity measures – such as firm size, profitability, sales growth, market value and survival. Experimental evidence further confirms a positive correlation.2 Continue reading

Biases in entrepreneurship and industrial policy in Africa

Forum Afrique2017-Visual Identity - FR-3

By Wim Naudé, Professor in Business and Entrepreneurship in Emerging Markets, Maastricht University, Dean of the Maastricht School of Management, The Netherlands, and Research Fellow at the IZA Institute for Labor Economics, Bonn, Germany


Learn more about this timely topic at the upcoming
17th International Economic Forum on Africa
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shutterstock_415121221.jpgAfrica has failed to industrialise. At the same time, millions of young people are seeking jobs. Put one-and-one together and the answer seems to be that if these labour market entrants become entrepreneurs in industry then they can in one stroke create jobs and help Africa industrialise. Yet, optimising the nexus between entrepreneurship and industrialisation requires overcoming some vexing policy biases. These can be categorised as biases of over-estimation and biases of under-estimation.

First, industrialisation’s job-creation potential is often over-estimated. The world is in a Fourth Industrial Revolution (4IR) driven by technologies such as the Internet of Things, automation, additive manufacturing and big data analytics (see Naudé, 2017). These technologies are causing the loss of low-skilled routine jobs, of which Africa has a disproportionate share. It’s estimated that up to 66% of all jobs in developing countries are at risk. Relatively poor African countries such as Ethiopia are at a particular risk of having around 44% of current jobs susceptible to automation. The 4IR is furthermore leading to a ‘re-shoring’ of manufacturing back to advanced economies. This is to the detriment of low-wage labor in African and other developing countries. As Culey (2012) points out: How important is low-cost labor when you don’t actually need labor?
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What’s standing in the way of South Africa’s entrepreneurs?

By Talitha Bertelsmann-Scott, Head : Economic Diplomacy Programme, and the entire Economic Diplomacy Programme team, South African Institute of International Affairs (SAIIA)


Explore the 2017 African Economic OutlookEntrepreneurship and Industrialisation in Africa for more on this subject.


Sout-Africa-EntreIndustrialisation is a key driver of sustainable development. It creates jobs, adds value and promotes trade through greater integration into global value chains. At the same time, entrepreneurship and small and medium enterprises (SMEs) are critical to every economy by creating jobs and innovative goods, promoting a competitive environment and economic growth, and facilitating income distribution. The South African government recognises the need for entrepreneurship and SMEs’ engagement with industrialisation efforts to address some of the key socio-economic challenges in the country, particularly poverty, inequality and unemployment. However, South African entrepreneurs 1 still face a number of constraints that hinder greater participation in industrialisation efforts. So, what are the roadblocks standing in the way of entrepreneurs? Continue reading

Implementing industrialisation strategies in Africa

By Dirk Willem te Velde, Director of Supporting Economic Transformation Programme and Head of International Economic Development Group, ODI


Explore this topic further with the upcoming launch of the
2017 African Economic Outlook: Entrepreneurship and Industrialisation in Africa.
Stay tuned for details


Industrialisation-Africa

A cursory look at national and pan-Africa policy statements suggests that many African countries have a strong desire to industrialise. They have a point: manufacturing creates jobs, diffuses technology and makes the economy more resilient. Unfortunately, much analysis points to a reduction recently in the share of manufacturing as a percent of GDP on the continent, although significant progress is being made in selected countries. Real manufacturing value added has grown around 7% annually or more over 2005-2015 in Tanzania, Rwanda or Ethiopia. And few realise that real manufacturing production and exports of manufacturing doubled in sub-Saharan Africa in the decade to 2015.1

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Africa’s industrialisation: leaving no woman behind

By Li Yong, UNIDO Director General


Explore this topic further with the upcoming launch of the
2017 African Economic Outlook: Entrepreneurship and Industrialisation in Africa.
Stay tuned for details.


women-work-industry-africaAfrica must industrialise to fulfill its economic potential. To achieve the Sustainable Development Goals (SDGs) as part of the 2030 Agenda, we need to support Africa in accelerating its development by promoting inclusive and sustainable industrialisation.

Inclusive industrialisation means ensuring that no one is left behind, especially not women. Including women is critical, not only because gender equality is a fundamental human right, but also because it enables faster economic growth, shared prosperity and sustainable development. The 2016 Global Gender Gap report1 shows a positive correlation between gender equality and gross domestic product, economic competitiveness and human development. The economic benefits to increasing female labor force participation are real. The OECD estimates that GDP would increase by 12% if participation rates for women were to reach those of men by 2030.2 

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