Building Sustainable Businesses in Africa

By Brittany Lyons

Although Africa is rich in many natural resources, the people who live there are the poorest in the world. Some areas in Africa have high concentrations of diamonds, oil, gold and other minerals, but these resources are finite and cannot be counted upon to provide sustainable wealth to future generations of Africans. Indeed, the existence of mineral resources has contributed to the poverty of many Africans by spawning armed conflict over the control of mines and wells, and by giving rise to corrupt governments that sell those resources to first-world countries at the expense of their own citizens. Much of Sub-Saharan Africa has abundant fertile soil and water, but most African agriculture relies on human and animal power, and cannot adequately feed Africans. Much has been said about the need to help these impoverished people, but what can actually be done?

The United Nations recognizes that the development of sustainable industry is necessary for Africa to overcome poverty. Simply putting control of natural resources into African hands would not be enough, as it only sparks conflict and harms the environment. While countries like the United States have tried to solve the problem through education initiatives, many Africans who earn PhDs end up leaving for a better life elsewhere.

What's more, the vast majority of aid to Africa has come from non-government organizations, or NGOs, many of which have been criticized for supporting ex-pats more than the local Africans who need their help. According to Alicia Polak, in an article from Wharton University, even those NGOs who do focus on helping the needy often do more harm than good. She recounts a story about her time spent distributing wind-up radios in Rwanda, one of which she gave to a 16-year-old girl who was raising five siblings. As they were leaving, Polak noticed several men converging on the girl's hut. “I thought, what did we just do here? What were the ramifications of giving a young 16-year-old girl a radio that is so valuable? Maybe nothing, but the point is I just felt like one of these do-gooders who hasn't thought things through.”

So instead of throwing money around, Polak returned to her business roots. She knew that the biggest problem in South Africa was that the four million whites controlled most of the buying power, while the 40 million blacks were left in the cold. Instead of pandering to this already powerful demographic, she built a new market for her cookie business—in Khayelitsha, one of the poorest townships in the areas surrounding Cape Town. The business is run by local women, and sells mostly to tourists. The company has done quite well, and Polak has made her local employees partners in it, which means that they have the incentive and skills to continue it without her.

Plus, Polak's business does not rely on controlling or depleting Africa's natural resources. Instead, it relies on African people—a resource that no one will fight wars over, and will never run out. In this way, she's helped her employees to build a life that cannot be yanked away when the funding stops, and keeps them out of resource conflicts. It is businesses like this that are going to help lift Africans out of poverty.

The development of industry in Africa must be self-sustainable, without outside help, if it is to continue to feed and employ Africans. If an industry relies on charity, like many NGOs do, that industry will not exist once generosity runs out. Plus, NGOs make impoverished black Africans reliant on the charity of white benefactors instead of empowering them to change their own lives. In the end, this will only make poverty worse.

Additionally, local businesses cannot rely on exploiting Africa's vast natural resources, as these simply spark property battles, and will eventually run out anyway. Enterprises throughout the world are beginning to realize that sustainability, both economic and environmental, is necessary for long term planning and stability, and the situation in Africa is no different. If you really want to help Africans, don't send money—send sustainable business plans.

[Image credit: AdamCohn, Flickr]

Brittany Lyons aspires to be a psychology professor, but decided to take some time off from grad school to help people learn to navigate the academic lifestyle. She currently lives in Spokane, Washington, where she spends her time reading science fiction and walking her dog.