WILL AFRICA REAP THE YOUTH “DEMOGRAPHIC DIVIDEND”?

In November 2022 the global population hit 8 billion. World population did not reach one billion until 1804. The United Nations estimates that It took 123 years to reach 2 billion in 1927, 33 years to reach 3 billion in 1960, 14 years to reach 4 billion in 1974 and 13 years to reach 5 billion in 1987. This implies that the frequency with which the global population is hitting one billion is increasing.

The biggest beneficiaries of this global population rise will be parts of East Asia and Africa. Africa will remain a relatively younger continent than other continents for much of the next century. From a theoretical point view, one might assume that this will drive economic prosperity in Africa due to a small dependency ratio in the population coupled with a bigger work force. The existing level of readiness for this increase in population gives little cause for optimism.

Prosperity just doesn’t happen by chance, unfortunately. For Africa to benefit from the vast number of youth there should be a deliberate strategy to invest in education, employment and skilling programs and good governance systems that rewards excellence not patronage. That’s how per capita productive capacities of the youth on this continent will be increased.

As of today, the African Development Bank estimates that of Africa's nearly 420 million youth aged 15-35, one-third are unemployed and discouraged, another third are vulnerably employed, and only one in six is in wage employment. By comparison, youth in UK are on average, 30 times more productive than their African counterparts. This figure is even higher if compared to youth in certain Asian countries.

Is Agriculture the way?

The agricultural sector is frequently lauded as a promising industry in modern Africa, with the expectation that it will empower young people and boost productivity. Nonetheless, in many African nations, the youth are struggling to reap its benefits. This is not due to any inherent flaws in agriculture, but rather due to inadequate management of the industry, from production to packaging, which renders young people particularly vulnerable.

As an example, in Uganda, a young person may take out a loan and even sell their inherited land to invest in agriculture, only to realize little to no return on investment. A significant amount of money is spent on agricultural inputs, yet when it comes time for harvest, the produce is sold at prices lower than what was invested. In many cases, it is the middlemen who benefit from agriculture rather than the farmers themselves. This is because young agricultural entrepreneurs, with no incentives, are pitted against firms owned by individuals who have access to capital from the national resources. By and large, due to the absence of effective agricultural subsidies in Uganda, compounded by haphazard free-market economics, farming has become largely unprofitable for most local farmers.

Other alternatives

For many young people, agriculture does not offer a viable source of income, leading them to explore other options, such as the increasingly popular motorbike taxi business. Known as "boda boda" in Uganda and Kenya, "Okada" in Nigeria and Ghana, and "Piki piki" in Tanzania, this type of business has become a go-to for many youths, particularly with the rise of urbanization and the decline of agriculture. In some cases, young people are even selling their inherited lands to purchase motorbikes, as the immediate income generated from this business is deemed more beneficial than long-term investments. The proliferation of these motorbike taxis is also due to the lack of a cheap and efficient mass-transportation system in places like Kampala.

The meteoric rise of the motorbike taxi industry among African youths has left politicians largely silent, as they struggle to offer a viable alternative. Despite being aware of the dangers inherent in this line of work and recognizing that it is not a sustainable economic option, politicians have been unable to provide workable solutions. Instead, the sheer numbers of this unregulated boda-boda industry makes them a force to reckon with. The politicians are scared of them in a bid to keep their populist support.

Can the natural resources help?

It is sad to note that the vast amount of natural resources is not aiding productivity either. For instance, in Mozambique, the global demand for the precious coloured gemstones called rubies have not translated to prosperity for the youth in communities where, Gemfields, the company that owns the Montepuez Ruby Mine is located. The price of rubies has been rising steeply due to high demand in Asia, but this has not translated into employment opportunities for youth in these communities. Instead, it appears to be a cash-out opportunity for neo-colonial investors.

In the last 10 years, the British owner of the rubies mines in Mozambique has sold over 500 million Euros worth of rubies all over the world. Beyond public relations stunts dealing with corporate social responsibility, these companies just extract this wealth without employing the youth communities. This has made the youth in Montepuez resort to getting onto the land owned by Gemfields to do illegal mining of these precious gemstones.

Conclusion

Lee Kuan Yew, the father of modern Singapore, wrote in his book, “From the third world to first world,” that for society to be transformed, “you need an emergence of an enlightened critical elite” that will push the wheels of society. In Africa we seem to lack this enlightened elite that thinks for the general society. In order to create a self-sustaining cycle of growth, it is essential to invest in human capital and ensure that individuals are able to put their skills to use locally, rather than migrating to build other nations' economies. This requires significant investment in education and the provision of incentives for viable sectors such as agriculture and the digital economy.

If we act decisively and promptly, Africa's growing youth population can be transformed from a potential liability into a tremendous asset. However, if we fail to take action, we risk facing a ticking time bomb that may become impossible to defuse. Only time will tell whether we will reap a demographic dividend or suffer the consequences of inaction.