Encouraging youth economic participation through Shared Growth

Young people need skills that enable them to secure their future; entrepreneurs need access to opportunity, skills training and capital in order to grow their businesses, create employment and grow the economy; and people need access to reliable and affordable financial services and products. These are areas where we can help improve lives and fulfil our principle of stewardship – leaving the communities where we operate better than when we found them.

We have set ourselves a specific objective of preparing young people across the continent with the requisite skills to be competitive in the workplace. Our ReadytoWork programme provides them with free education and training programmes, online and in workshops, with accredited institutions.

So far, the programme has been rolled out to nine countries and helped equip 205 366 young people with people, money management and entrepreneurial skills. ReadytoWork seeks to address the challenges under discussion at the WEF meeting on Africa which include reinventing job-ready training, advancing digital fluency and other key skills, and reforming education and training systems.

In addition to ReadytoWork, we are investing R1.4bn in education over the next 3 years. Between 2016 and 2018 we will have provided over half a billion rand in university scholarships across all our markets, providing opportunities to thousands of deserving students. While many of the key pieces are in place, government, business leaders and educators need to work together to set out a shared vision and the necessary policies and programmes to prepare African youth for the Fourth Industrial Revolution and ensure their competitive advantages become sustainable livelihoods.

In its draft, June 2016 strategy document, the African Capacity Building Foundation cites a study on the capacities needed to implement the African Union’s Agenda 2063 development plan, which says that Africa has a projected gap of as many as 4.3 million engineers and 1.6 million agricultural scientists and researchers. In most African countries, the gap between the actual number of professionals in critical technical areas and the minimum required number is as high as 70%. Until there is a better match between the needs of the economy and young people’s skills, they will continue to struggle to find jobs.

Enterprise Development is critical to employment creation and economic growth. It is therefore imperative to build a culture of entrepreneurship and to support the development of small businesses and their integration into the African market. Almost half the labour force in Africa is employed by small businesses. These businesses are especially important in low-income communities, where they provide informal work to those who lack the qualifications or experience to secure formal employment. Small businesses also help diversify economies away from reliance on a single commodity, making them more resilient in the face of economic headwinds, and help broaden the national tax base.

Our Shared Growth enterprise development programmes not only offer entrepreneurs business support and training, but also access to markets, without which they cannot succeed. As a financial institution we are in a unique position to connect small businesses with large corporates. We have created a portal that links 59 000 small and medium enterprises to 7 000 corporate buyers where last year over R30 billion worth of tenders was advertised. Last year we agreed to R1.38 billion worth of mandates for SMEs who are doing business with corporate partners and provided training to thousands of SMEs.

The last pillar of Shared Growth is providing access to financial services, an important means of facilitating economic activity. Technology has reduced the cost of providing banking services. New digital platforms are being designed for those who – until now – have not had access to formal financial services. Already we have a network of 10 013 ATMs across the continent and are constantly expanding our network of branches and service points.

In its 2017 Inclusive Growth and Development Report, the WEF observes, “A coordinated global initiative is required to transform inclusive growth from aspiration into action – into a new global growth agenda that places people and living standards at the center of national economic policy and international economic integration.” We believe our Shared Growth philosophy goes a long way to achieving this. We look forward to continue collaborating with governments, our corporate partners, communities and other stakeholders to create more opportunities for inclusion and to grow the African economy.

Sazini Mojapelo is Head of Citizenship at Absa