The authentic travel experience should be a boon for Africa, but its missing the mark.
Since 2016, tourism market trends have shifted away from “get-a-way” travel to traveling for ‘authentic’ experiences. This transformation is driven by the world’s largest consumer group—millennials—and amplified by digital platforms and social media but is also echoed across other segments.
African countries, with their abundant wealth of natural and cultural assets, are perfectly positioned to capitalize on this shift, just as the rise of digital platforms are reducing market access barriers for such products. However, in our new World Bank Group report, we found that
- Standards: Africa’s market share lags other regions, and many products are not of sufficient standard.
- Exclusion and the digital divide: Marginalized groups, often best placed to deliver the product, are at risk of further exclusion.
- Community Impact: Bringing tourism into communities also brings other risks which need to be managed.
Such reluctance of many local financial institutions (FIs) to invest has been a major impediment to the Nigerian solar off-grid market which lags compared to other African countries such as Kenya.
“The empowerment of young people and women lies at the heart of our organization,” declares Fatouma Harber — human rights activist, teacher, blogger and CEO of SankoréLabs. SankoréLabs is an incubator that also provides training and co-working spaces to young entrepreneurs in Timbuktu in northern Mali. Named for the city’s world-renowned historical university and 14th century mosque, SankoréLabs provides aspiring entrepreneurs with support and a space to work. Along with meeting incubees’ IT, internet and networking needs, the incubator is also a vehicle to promote better local governance and enhance citizen engagement in a region that desperately needs both.
Founded in January 2016, INCUBONS provides access to co-working spaces and free services to social enterprises and start-ups including intensive technical assistance, mentoring and 24/7 coaching. The incubator has an extensive outreach program, including events, debates and concerts, as well as networking opportunities to connect their incubees (10 companies a year) to each other and to potential partners and investors. INCUBONS also provides pre-incubation counters where people can present their ideas and projects are diagnosed free-of-charge and then referred to affordable training courses.
What are the key pain points smallholder farmers face? Gaps across the agriculture value chain—lack of access to affordable financial products, limited knowledge of high-quality inputs, low usage of technology and market data, and poor market links. Social enterprises (SEs) in the agriculture sector are successfully closing these gaps, believing that the cost of their services or products will be recuperated by the benefits and income gains that smallholders will achieve.
For example, SEs implement innovative solutions through information and communications technology (ICT) platforms. Esoko’s text alerts on weather conditions and crop market prices saves smallholders in Ghana both time and money. Shamba Shape Up is a “makeover” style farming reality show that gives advice on improving farms and increasing yields to Kenyan farmers. Digital Green recruits local, established farmers to share their farming techniques—from pest-control to seed treatment—in over 3,500 videos for peer smallholders in Africa and India.
The Picard leather goods factory in Dhaka, Bangladesh produces bags, purses and wallets that are sold in upmarket stores throughout the developed world under various well-known brand names, and in their own chain of stores in Germany. The factory is clean, efficient and goods are produced under all the relevant international standards.
But Picard are a rarity, and most Bangladeshi manufacturing looks just like it did 50 years ago. They produce cheap goods for the local market, but are a huge distance from producing at global standards. Unfortunately, this is also the case with most manufacturers in emerging economies. And all manufacturing is being changed by a range of new technologies known as Industry 4.0, with manufacturing becoming more global, more automated, more highly skilled, more infused with technology and more integrated with services. Whole manufacturing sectors, but in particular Small and Medium Enterprises (SMEs) face real challenges if they are to adapt rather than be left behind.
“From plastic waste to building materials,” a partnership supported by the World Bank Group gathering six private sector frontrunners in Kenya, is testing exactly this.
This Saturday, June 16, we celebrate International Day of Family Remittances to recognize “the significant financial contribution migrant workers make to the wellbeing of their families back home and to the sustainable development of their countries of origin.”
Which is why
In recent years, the international remittance services industry has been subject to the so-called “de-risking” phenomenon. Banks believe that anti-money laundering and counter financing of terrorism (AML/CFT) regulations and enforcement practices have made serving money transfer operators (MTOs) too risky from a legal and reputational perspective. For banks, the profit of serving MTOs is not considered sufficient to justify the level of effort required to manage these increased risks.
In November 2016, we published the “Practical Guide for Measuring Retail Payment Costs”, an innovative methodology that can be customized to country needs and circumstances, without losing the international comparative dimension.
The guide enables countries to measure the costs associated with retail payment instruments, based on survey data, for the payment end users, payment service/infrastructure providers, and the total economy. The guide also enables countries to derive projected savings in shifting from the more costly to the less costly payment instruments.