What opportunities and challenges do Africa鈥檚 young entrepreneurs face in the听听(AfCFTA)? On behalf of the Economic Commission for Africa, Busani Busani put the question to Julie Kubia, research director of听, a Kenya-based marketing firm.
What trade prospects does the AfCFTA present for African youth?
The AfCFTA holds immense potential. Imagine what it means when people across Africa can finally access a single market for goods and services! The removal of trade barriers presents opportunities for young people looking for new markets. They are entrepreneurial, open-minded and view risk differently.听
We trade a lot with Europe, China and other regions, but now we are increasing the potential for a young Kenyan farmer or entrepreneur to find a new market for Kenyan tea in Nigeria or Morocco or to access Moroccan mint tea for sale in the Kenyan market. That is a big opportunity.
The AfCFTA also promotes investment and industrialization, and so it鈥檚 also about increasing openings for jobs in manufacturing and tapping into new value chains in agriculture or technology. One of the most exciting aspects is AfCFTA鈥檚 emphasis on the digital economy, which encourages young entrepreneurs to leverage technology in e-commerce and scale up.听
While AfCFTA鈥檚 primary objective is to foster intra-African trade and boost economic growth, the dream of many young Africans is to travel to other countries. We often think of travel in overseas terms, but the AfCFTA鈥檚 protocol on free movement of people within Africa can be a game changer. If young people can trade, travel and find jobs on the continent, they will contribute to the prosperity of Africans.
If young people can trade, travel and find jobs on the continent, they will contribute to the prosperity of Africans
Is the emphasis on women and youth necessary in promoting youth in trade?
Yes. We are a very young continent. Experts tell us that more than 60 per cent of the continent鈥檚 population is young and about 50 per cent is female. Youth and women represent the majority of those who manage small and medium enterprises and start-ups. This makes these two demographics key drivers of trade.听
By actively engaging women and youth in trading goods and services, we pave the way for inclusive economic growth. They are our present and our future.
What kinds of challenges do Africa鈥檚 young entrepreneurs encounter, and how might they address those challenges?
Entrepreneurship is tough for anyone, regardless of age. Young people face many challenges, such as limited access to capital. Many struggle to secure financing to launch and sustain their businesses. Traditional financial institutions often require collateral or a lengthy credit history, locking out many aspiring young entrepreneurs.
We need more access to domestic funding and banking systems that meet the needs of the younger generation. Banks must dramatically change their understanding of risk. We will not thrive as a continent until we advance new models for assessing risk.
By actively engaging women and youth in trading goods and services, we pave the way for inclusive economic growth
How crucial is market research for young entrepreneurs?
I cannot overstate the need for market research, particularly for young entrepreneurs seeking to carve their niche. Market research yields crucial insights into consumer preferences, market trends and industry dynamics. It validates ideas and refines strategies to align with target market needs.听
Those may sound like abstract ideas, but I have seen many businesses fail because they didn鈥檛 conduct or pay attention to research. For instance, a company wrongly uses sales figures from Australian, US, and UK markets to launch an expensive water purifier product in Kenya. The uptake will not be the same, because Kenya is a developing country with different priorities in terms of basic necessities and wallet spending.
As the demand for goods and services grows across the continent, the youth can seize these opportunities and become key catalysts in the continent鈥檚 economic transformation.
