Based on an amendment accepted by Parliament on 8 December 2016, PUM and Africa in Motion designed ‘Making Africa Work’, a pilot project that will be executed in 2017. This project aims to establish 40 linkages between (young) entrepreneurs in the Netherlands and those in Africa, with each successful linkage resulting in a business plan, including marketing analysis and feasibility studies, ready to be presented to potential funders.
By tapping into the power of diaspora in the Netherlands and networks in their home country, we aim to strengthen the business plans and their potential for funding. ‘Making Africa Work’ will be executed in five African countries: Ghana, Kenya, Morocco, Rwanda and Sierra Leone. For this project we join forces with various partners, including the Dutch and local business communities, diaspora organizations, African incubators, existing government programmes that aim to foster entrepreneurship and employment in Africa, and investors such as Grofin and the DGGF for start-ups.
Addressing youth employment
The project has been designed to address youth employment in Africa. Many African countries have stabilized politically since the disruptions of civil wars in 1990 and 2000s and have shown promising economic growth figures. However, there is still a long way to go to reach prosperity for all inhabitants, especially for young people who are often unemployed. Sub-Sahara Africa has the youngest population of the world. After leaving school, a striking majority of young people enter the informal economy, while many migrate, looking for opportunities elsewhere, resulting in a brain drain and a lack of new ventures. With an unemployment as high as in African countries (reaching 80% in e.g. Sierra Leone) improving employment by finding jobs in the growing economy is impossible without the creation of new companies.
Involving young (migrant) entrepreneurs from the Netherlands
Many (young) entrepreneurs from the Netherlands, amongst whom various migrants, are interested to do business in Africa. There are interesting opportunities for them in areas such as sustainable energy, ICT, processing, agriculture and horticulture. However, they lack financial resources and often cannot benefit from trade promotion instruments as most of these require financial leverage from their side, which is hard or impossible for them to arrange. They specifically need support in the unprofitable start-up phase of their business. Once having received support to work out their ideas into bankable business plans, the road to commercial banks and investors is within reach.
Access to finance
With this pilot project PUM broadens its scope from supporting SMEs to facilitating start-up entrepreneurs. We also accommodate the need for finance, which is specifically visible in the start-up phase of businesses. By supporting young entrepreneurs to build their businesses, we lay the foundations for the development of a new group of SMEs to come into existence, contributing to the growth of the economy as a whole.
A recent study from the UNDP on Sierra Leone states the following:
‘Youth unemployment is one of the major causes of war in Sierra Leone and a serious threat to the peace that prevails in the country today. An estimated 800,000 youth between the ages of 15 and 35 are actively searching for employment. Some of these youth lack skills and education, but it is even more difficult for those with disabilities and only a basic education to compete for the limited jobs that are available’.