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Leapfrogging: The key to Africa’s development?


Leapfrogging: The key to Africa’s development?

Leapfrogging: The key to Africa’s development?
Photo credit: Sarah Farhat | World Bank

Despite sustained economic growth over the past two decades, Sub-Saharan Africa faces massive challenges and significant gaps in many development outcomes. Although poverty has been declining, a recent report estimates that over two-fifths of the African population was poor in 2012.

Nearly two-thirds of Africans do not have electricity. Less than one quarter of African enterprises have loans or lines of credit; the corresponding share among firms in non-African developing countries is almost half. The use of formal financial services is concentrated among the richest 20 percent of the population. Most African countries have made significant gains in access to education, but learning remains weak. The agriculture sector, which employs a large share of the labor force, exhibits low productivity. Technological change and levels, which are the drivers of productivity, are much lower compared to other parts of the world. Even simple productivity-enhancing factors like the use of fertilizers has remained flat for decades.

Africa’s large infrastructure, technology, and policy gaps require disruptive solutions and thinking outside of the box. Yet, development policies have often been primarily programmatic and mostly incremental. This book argues that it is time to go back to basics of development, think big, and foster the environment for more innovation and technology adoption, to provide the chance for Africa to experience major positive transformations. This is not a new idea; to the contrary, it is what economic theory and history teach. There is no solid ground to treat Africa as an exception.

The one commonality among almost all contemporary growth and development theories is that they consider technology and innovation as the primary drivers of economic growth. Historical experiences point to the same evidence. Major changes in the history of countries like the United Kingdom, the United States, or even recently developed and emerging economies can be tightly linked to increased productivity through the adoption of better technologies. The stream of inventions that began in the 18th century in the United Kingdom, from the steam engine to electricity, the power loom, and machine tools, has dramatically changed the course of human history. More recently, the phenomenal rise of South East Asian countries involved moving from low productivity agriculture (paddy fields) to manufacturing and more technology-intensive electric and electronic components.

Squarely focusing on uncovering investment opportunities that could reduce the distance to the technology frontier should therefore be the starting point in thinking about African development. Equally important is the acknowledgment that Africa need not follow the same path and/or steps as other emerging regions. Vertiginous changes brought about by the digital revolution in the past 20 years (World Development Report 2016) make leapfrogging (skipping steps, charting new paths) in Africa not only a possibility but a necessity.

While it has become customary in the development practice to highlight and quantify constraints to investing in Africa, this book argues that those constraints must be seen as and transformed into investment opportunities. Several factors, such as skills, service delivery, access to finance, energy, to name the few, are often pointed out as constraints to investment. Treating those constraints as investment opportunities, attracting the private sector, both domestic and foreign, and creating a conducive environment for technological diffusion is precisely how Africa will harness innovation toward its prosperity.

This book is the product of a collaboration between the World Bank’s Africa Region and the China Development Bank. The book provides the analytical background to the Third Investing in Africa Forum in Dakar, September 25-27, 2017.


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