, NAIROBI, Kenya, Jan 9 – A key way to lift African economies is through home-grown high impact entrepreneurs because they know how to best act as role models for other Africans and inspire their fellow entrepreneurs.
This is according to a new book released by World Bank dubbed ‘Developing Africa’s Financial Services – The Importance of High-Impact Entrepreneurship’.
In its argument, the World Bank adds that high-impact entrepreneurship in the financial sector is key to unlocking the potential of economic growth in the continent.
According to a 2014 report by the World Economic Forum, entrepreneurship decreased unemployment by 20 per cent.
This is because high impact entrepreneurs grow faster, create more jobs, contribute to society, and transform industries to a greater extent than their peers.
The report further indicated that two out of four per cent of entrepreneurs can be considered high impact, and are the driving force behind 40 per cent of all total jobs created.
“Africa’s economic performance, in terms of growth in GDP per head, is less than half that of South Asia, while Africa has over twice the level of unemployment. However, the biggest challenge in the continent is access to finance and how to use technology to increase access,” said Professor Dana Redford, the book’s editor and President of the Policy Experimentation and Evaluation Platform (PEEP).
Kenya needs to create at least 3.9 million jobs for young people by 2020, according to a recent report, which puts the total number of Kenyans who are currently unemployed at 1.5 million against a population of 48 million.
A report by Endeavor and SAP 2015 further adds that the solution to Africa’s problems lies in wealth creation by high-impact entrepreneurs.
In Kenya alone, about 7.5 million enterprises contribute approximately 45 per cent to the Kenyan GDP, a number that is likely to drop if high-impact entrepreneurship model is not embraced.