HOW CAN THE 'AFRICAN GORILLAS' BECOME A FORCE IN THE GLOBALIZED ECONOMY

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             In the 80’s the world economy was fueled by the Asian Tigers. These were export led economies that created a strong middle class in their countries. Today, we have the African Gorillas who want to do the same thing.  The African Gorillas have the potential to become significant players in the global economy.  Let us use Rwanda as an example of how the African Gorillas are trying to develop. The West has spent $1 trillion on aid to Africa over the past 4 decades. This has not built strong economies because aid doesn’t create jobs. It creates dependency.  Job creation is critical for a nation like Rwanda. Half of its population is under 18. If Rwanda is to create a middle class, job creation has to be emphasized. The government can’t hire all these people. Unless jobs are there, eventually civil unrest will develop. The means that Rwanda and the rest of the African Gorillas desire to develop is through outside investment using private entrepreneurs.

Rwanda wants investment because they want to build the build a business environment and infrastructure that is needed to create a strong middle class. Rwanda desires investment and eschews aid, although presently aid makes up half of Rwanda’s budget. Investment is a driver of economy and aid saps the economy. The mistake that a lot of third world countries make is that they receive foreign aid. Foreign aid does not work because it doesn’t create jobs.

                        Rwanda has some severe limitations in creating a middle class. It is landlocked, and largely deforested, and 90% of its population is subsistence farmers. The biggest asset that Rwanda is its President, Paul Kagame This is a nation that is led by a President who wants to make his country business friendly.

            President Kagame has lofty goals. He wants to boost GDP sevenfold, find paying jobs for half of Rwanda’s subsistence farmers, nearly quadruple per capita income to $900, and turn his country into an African center for technology, all by 2020. Creating a strong technological base is key to Rwanda and the rest of the African Gorillas. Rwanda has committed 5% of its GDP in science and technology by 2012.

            Rwanda’s strategy revolves around brand reversal. This strategy involves having key entrepreneurs from the west invest, have successful experiences in Rwanda, and attract newer investors through networking. Social media is a key ingredient to the development of the African Gorillas. Facebook has approximately ¼ of the world on their site. If ¼ of the world understand that Africa is great place to invest, it is the hope of the Gorillas that the world will come to Africa and help them develop their continent.

            The strategy of the African Gorillas is this. Anyone with a big idea, a smart phone, and an app can now connect with a worldwide market and build a brand.  By partnering with Western investors, the Gorillas hope to adapt products to African needs and cultures, build strong middle-class communities, and bring their continent to the point that Africa is part of an interconnected world.

Dean Hambleton

dnhambleton@gmail.com