Jean-Claude Bastos de Morais, an active investor in Africa, heads Quantum Global Group. He recently talked to freelance journalist Eugen Iladi about his hopes for the continent. Here are excerpts from the conversation —
You grew up in Switzerland, but are now devoting considerable energy to advancing innovation and economic development in Africa. Why are you focusing so much of your attention on Africa?
I was born and raised in Switzerland, but my father is from Angola and I still have family there, so I have had an interest in Africa my whole life. My Angolan grandmother was a big influence, first because she worked hard to send my father to Europe for an advanced education and, later, by urging me to come to Africa and connect more closely to that part of my heritage. She believed that if I helped create opportunity for other Africans it would be a way to give back to Angola.
In 2009, you established the African Innovation Foundation (AIF) and two years later that organization launched the Innovation Prize for Africa. Why did you decide to set those up?
I wanted to honor my grandmother by working to build the African economy. After giving it some thought, I decided that creating some kind of permanent structure would have a greater and longer-term impact than donating money or backing an individual project.
I decided to focus on innovation because new ideas are the real root of economic diversity and growth. If you look at innovations that have changed the world – the light bulb, the automobile, airplanes – they typically started out with one or two people tinkering away somewhere. Even more recent innovation by large companies, such as the smartphone, took years to move from idea to product; innovators need continuing support to develop their idea and bring it to market.
AIF aims to provide that support. We build on Africans’ innovative spirit by providing grants and awards such as the Innovation Prize for Africa to help creative individuals convert their ideas into real products. We aren’t just looking for world-changing products, but also needs-based concepts that lead to African solutions for African problems.
What are the ultimate aims of the organization?
AIF is a platform for innovators and investors to collaborate and share knowledge. We hand out prize money to deserving innovators. We are also working to build basic infrastructure, including law and governance, that can help attract private sector investment. In the long run, private sector investment is essential to provide the seed money to sustain innovation and also the know-how and funds to bring innovations to market. Innovation only bears fruit if they succeed in the market place. Ideally such successes build on themselves by generating profits that can sustain a permanent cycle of continuous innovation, product development and marketing success to support new entrepreneurs and create economic growth.
What have AIF and the Innovation Prize for Africa achieved so far?
Let me just focus on two things. First, I think we have raised awareness among government officials, the private sector, and the entrepreneurial community that we need to be working together to support innovation and to develop the legal systems, physical infrastructure and financial systems needed for sustained innovation.
We’ve also helped individual entrepreneurs develop a diverse range of home-grown innovations to solve African problems. We’ve provided a way for innovators across the continent to connect with one another and share ideas about the ideas they are working on and how to address challenges. We estimate that we’ve engaged more than 6,000 individual entrepreneurs in 50 countries. I feel very good about that.
Could you please give me an example or two?
Some examples of the sorts of projects that have won Innovation Prizes for addressing challenges that crop up almost every day in Africa include, from Benin, a more affordable anti-malaria drug treatment made from natural plant extract; from Nigeria, a non-blood diagnostic device that can diagnose malaria in less than 25 minutes; and from Kenya, a risk sharing agri-business funding mechanism called Farm Capital Africa that draws private investors by sharing profits and enables small-scale farmers to access capital for expansion.
More broadly, what are the biggest economic and development challenges for Africa?
The first thing we have to do is embrace the challenge and establish long-term sustained development as a core goal. That will take a commitment from policymakers to support entrepreneurs and innovators with policies that attract private investors from both inside and outside of Africa.
That means building strong legal systems that respect property and contract rights. It also means developing the sort of regulatory structures that pave the way for strong lending institutions that will provide financial support for start-ups as well as more mature businesses so they can expand and grow.
We need the right physical infrastructure, too, and not just Internet connectivity. Internet connectivity is critical, of course, because you cannot fully participate in the world economy unless you can connect to markets around the world. Even if you confine operations to Africa, connectivity enables you to reach a much wider range of customers and markets.
We also need basic infrastructure such as universal access to electricity. Nearly two of every three people in sub-Saharan Africa do not have electricity. That’s a terrible obstruction that makes it very hard to tap the continent’s economic potential and spread opportunity widely. And, we need the transportation networks to move goods to market, both locally and overseas.
We also need to strengthen our educational system to give younger people the skills to succeed in the 21st century – to leap ahead with new programs. And, the training must be available in Africa. We want to be able to bring faster ways to learn on the ground. We cannot rely on sending young people to Europe and the United States to study. Going abroad isn’t a realistic option for large numbers of talented students. What’s more, many of the people who leave Africa to study abroad wind up staying abroad instead of bringing their talents back to Africa. We cannot afford to lose so many of our brightest youngsters. If they don’t come home, we lose the future.
Should these come from government programs?
A stronger African economy requires support from the private sector and from public-private partnerships. As a rule, the private sector is nimbler than government, spots opportunities quicker, and is better positioned to take risks and invest in innovative ventures that are not guaranteed to succeed. That is true around the world, not just in Africa, but it’s important to understand. I am pleased that my own company Quantum Global has stepped up with expertise and investment to support development in Africa to play its part.
Right now, many African economies are suffering because of declining prices for natural resources, especially oil. Are you concerned that this will be a permanent setback for the continent?
In the short term, falling commodity prices have created economic strains for many African countries, but I believe we can convert this challenge into an opportunity. The truth is that much of Africa is too dependent on extraction industries that mine ore or bring oil and natural gas out of the ground. While we certainly want to take advantage of these natural resources, over-reliance on that sector means that we are too dependent on external events and forces that we cannot control.
But this rough page can be turned into a blessing if it opens the door to new partnerships between the mining industries, governments and investors to develop new models for the continent and to eliminate existing inefficiencies.
Do you have any other thoughts on how African countries should approach development?
I think it is important for countries to take a long view about what type of economy they want to build. For example, I hope the continent will not become a hub for cheap mass production. We’ve seen around the world that those types of jobs often mean low-wages and poor work conditions. These types of jobs are beneficial as interim development; putting people to work is a good thing. But the long-term goal should be a diversified economy based on enabling local industries to thrive by investing in segmented markets and new technologies. That means that each country can play to its strengths by building infrastructure, developing a skilled workforce, and investing in the local industries that have the best chance to grow and succeed.
For instance, an industry that could be developed just about anywhere on the continent is 3D printing. Innovation hubs in parts of Africa have been training workers in 3D printing, and they have had some small-scale success. The market is estimated to grow about 20 percent this year to $5 billion. But that’s still small compared to other sectors and that means there are opportunities to seize market share early in its development. This is the kind of development that can take hold in Africa with the right regulation, funding and skills development. Of course, it’s also contingent on core infrastructure we’ve been talking about — electricity, transportation networks, a vibrant financial system, and Internet connectivity. But, the point is that there are opportunities out there for boosting the African economy if we identify them and move fast to take advantage.
This article was first published African Herald Express