Every time I visit Africa, I am struck by two things that go hand in hand: the youth and the energy.
The median age on the continent is 18. Compare that to the median age in North America, which is 35.
These young Africans are inheriting a continent where fewer and fewer people have to struggle to survive and can instead devote their energy to planning for and investing in the future. The percentage of Africans living in poverty has dropped from 59 per cent of the population in 1990 to 38 per cent today.
Africa’s improvement in living conditions is one of the most important trends in recent history, and yet the data shows that it is also one of the most fragile.
Each year, our foundation releases a report tracking progress in the fight against global poverty and disease. According to current trends, the number of people around the world living in extreme poverty could stop declining and could even start growing again.
Most countries in the region are continuing to make steady progress against poverty. Ethiopia, for example, is on track to eliminate poverty within a couple of decades. As a result, poverty is concentrating in a relatively small handful of countries beset by severe climate change, violent conflict, and weak governance.
By the mid-century mark 40 per cent of the extremely poor people in the world will live in just two countries: the Democratic Republic of Congo and Nigeria. Together, those two nations will be home to almost 600 million people, and they are poor and fast-growing enough to offset the gains by their neighbours.
Some people both inside and outside the continent worry about what this large group of very young, very poor people will do when they are denied opportunities. Will they cause insecurity, instability, and mass migration?
But I think just as much about what they will accomplish if they have access to opportunities — if they grow up healthy, get an education, build businesses, dream up new inventions, and grow the global economy, the way that bright young men and women from around the world have always done.
The key to providing opportunities in the places where they are currently lacking is investing in what economists call, “human capital,” or the health and education of young people. These investments are not the only ingredient of a healthy economy, but they have played a pivotal role in lifting nations like China and India out of poverty. Economic models show that they can do the same for Africa, growing the continent’s GDP by nearly 90 per cent by 2050.
But first, African governments and businesses will have to invest more in their young people.
There are two areas, in particular, where they should focus this investment to maximise long-term growth prospects:
First, health: Most African countries have participated in the global revolution in child survival. Rwanda, just a few years removed from genocide, has built and effective health system from the ground up and seen the steepest drop in child mortality ever recorded. The next step is making sure children don’t merely survive but thrive. One third of African children are stunted, which means their brains and bodies aren’t developing fully. But there are proven strategies solving the stunting problem, and many have to do with food security.
For example, China was able to reduce stunting by nearly 70 per cent between 1990 and 2010, in part because the country’s farmers adopted new agricultural technologies. African countries, most of which are still predominantly rural, must invest in agricultural transformation to fight malnutrition and poverty.
Second, education. Since 2000, the number of African children enrolled primary school has increased from 60 million to 150 million, and the number of girls in school is now virtually equal to the number of boys. The next step is improving the quality of the education all students receive.
The data is spotty, but it suggests that more than half of students on the continent aren’t achieving minimum proficiency in math and reading. Low-income countries can achieve excellent results in their schools. Vietnam, for example, has a 97 per cent literacy rate; in 2015, they were the poorest country to participate in international student testing, but still ranked 8th.
Governments must learn how to transfer this success so that all students benefit. For most of human history, poverty was thought to be an inevitable part of the human condition, something that had always – and would always – exist. Over the last two decades, however, Africa has proven otherwise and shown the world that poverty is not an inevitable.
Whether more young Africans live in poverty – or more live to fulfill their potential – depends on the choices and investments we make today. I am hopeful we will make the right ones.
World Bank pushes G-20 to extend debt relief to 2021
World Bank Group President David Malpass has urged the Group of 20 rich countries to extend the time frame of the Debt Service Suspension Initiative(DSSI) through the end of 2021, calling it one of the key factors in strengthening global recovery.
“I urge you to extend the time frame of the DSSI through the end of 2021 and commit to giving the initiative as broad a scope as possible,” said Malpass.
He made these remarks at last week’s virtual G20 Finance Ministers and Central Bank Governors Meeting.
The World Bank Chief said the COVID-19 pandemic has triggered the deepest global recession in decades and what may turn out to be one of the most unequal in terms of impact.
People in developing countries are particularly hard hit by capital outflows, declines in remittances, the collapse of informal labor markets, and social safety nets that are much less robust than in the advanced economies.
For the poorest countries, poverty is rising rapidly, median incomes are falling and growth is deeply negative.
Debt burdens, already unsustainable for many countries, are rising to crisis levels.
“The situation in developing countries is increasingly desperate. Time is short. We need to take action quickly on debt suspension, debt reduction, debt resolution mechanisms and debt transparency,” said Malpass.
Kenya’s Central Bank Drafts New Laws to Regulate Non-Bank Digital Loans
The Central Bank of Kenya (CBK) will regulate interest rates charged on mobile loans by digital lending platforms if amendments on the Central bank of Kenya Act pass to law. The amendments will require digital lenders to seek approval from CBK before launching new products or changing interest rates on loans among other charges, just like commercial banks.
“The principal objective of this bill is to amend the Central bank of Kenya Act to regulate the conduct of providers of digital financial products and services,” reads a notice on the bill. “CBK will have an obligation of ensuring that there is fair and non-discriminatory marketplace access to credit.”
According to Business Daily, the legislation will also enable the Central Bank to monitor non-performing loans, capping the limit at not twice the amount of the defaulted loan while protecting consumers from predatory lending by digital loan platforms.
Tighter Reins on Platforms for Mobile Loans
The legislation will boost efforts to protect customers, building upon a previous gazette notice that blocked lenders from blacklisting non-performing loans below Ksh 1000. The CBK also withdrew submissions of unregulated mobile loan platforms into Credit Reference Bureau. The withdrawal came after complaints of misuse over data in the Credit Information Sharing (CIS) System available for lenders.
Last year, Kenya had over 49 platforms providing mobile loans, taking advantage of regulation gaps to charge obscene rates as high as 150% a year. While most platforms allow borrowers to prepay within a month, creditors still pay the full amount plus interest.
Amendments in the CBK Act will help shield consumers from high-interest rates as well as offer transparency on terms of digital loans.
Scope Markets Kenya customers to have instant access to global financial markets
NAIROBI, Kenya, Jul 20 – Clients trading through the Scope Markets Kenya trading platform will get instant access to global financial markets and wider investment options.
This follows the launch of a new Scope Markets app, available on both the Google PlayStore and IOS Apple Store.
The Scope Markets app offers clients over 500 investment opportunities across global financial markets.
The Scope Markets app has a brand new user interface that is very user friendly, following feedback from customers.
The application offers real-time quotes; newsfeeds; research facilities, and a chat feature which enables a customer to make direct contact with the Customer Service Team during trading days (Monday to Friday).
The platform also offers an enhanced client interface including catering for those who trade at night.
The client will get instant access to several asset classes in the global financial markets including; Single Stocks CFDs (US, UK, EU) such as Facebook, Amazon, Apple, Netflix and Google, BP, Carrefour; Indices (Nasdaq, FTSE UK), Metals (Gold, Silver); Currencies (60+ Pairs), Commodities (Oil, Natural Gas).
The launch is part of Scope Markets Kenya strategy of enriching the customer experience while offering clients access to global trading opportunities.
Scope Markets Kenya CEO, Kevin Ng’ang’a observed, “the Sope Markets app is very easy to use especially when executing trades. Customers are at the heart of everything we do. We designed the Scope Markets app with the customer experience in mind as we seek to respond to feedback from our customers.”
He added that enhancing the client experience builds upon the robust trading platform, Meta Trader 5, unveiled in 2019, enabling Scope Markets Kenya to broaden the asset classes available on the trading platform.