Harnessing demographic dividend in Africa

In this article, we break down the concept of demographic dividend and how it can be harnessed in Africa to drive development and economic productivity. Development, in general terms, speaks to the effective use of a country’s resources in order to improve its population’s standard of living. The two broad categories of resources are natural and man-made resources.

When referring to man-made resources, one speaks about aspects such as an educated workforce, capital, industries and a stable macroeconomy with established sectors that provide enough, quality and decent employment.

Although Africa is, largely, not yet industrialised, the continent consists of a growing workforce and boasts every natural resource (vegetation, soil, water, air and minerals, etc.) needed to facilitate for development. Based on the United Nations’ (UN) World Population Prospects 2019, Africa houses 17% or 1.3 billion of the world’s population of 7.7 billion.

“The world population is projected to reach 8.5 billion in 2030, and to increase further to 9.7 billion in 2050 and 11.2 billion by 2100,” according to the UN. “More than half of the global population growth between now and 2050 is expected to occur in Africa . . . The population of sub-Saharan Africa is projected to double by 2050.”

This population growth can be used to benefit the continent when every age group, especially the working-age population (15-64), exercises its rights. These are “dignity and human rights to expand their capabilities, secure their reproductive health and rights, find decent work, and contribute to economic growth”, explains the UN Population Fund (UNPF).

This introduces us to the concept of demographic dividend. According to the UNPF, demographic dividend results in “a boost in economic productivity that occurs when there are growing numbers of people in the workforce relative to the number of dependents”.

The situation suggests that there is a greater portion of the overall population that has the potential to carry out economic activities and make meaningful contributions to the economy.

Central to the demographic dividend is an increasing number of the working-age population, declining fertility, access to quality education, adequate nutrition and health, sexual and reproductive health for the working-age population.

In Africa, institutions that should be providing such services are hampered by lack of state funding due to the mismanagement of funds. Consequently, limited services are provided and women are the most affected group as they constitute more than half of the population. It further delays the harvest of demographic dividend benefits.

Gender-sensitive SMEs facilitation programmes to improve demographic dividend

Rara Reines, strategy director at Ground Breakers, said, “What has been absent from the debate [about demographic dividend strategies] is how best to incorporate women . . . in a way that goes beyond the quotas and targets that often fail to address the structural drivers of gender inequality.”

She added, “The current constraints women face, from the private sphere of the household to the public sphere of politics, are a major detriment to the continent’s economic development and inclusive growth process, and women’s empowerment in this sense goes far beyond income generation.”

One of her suggestions is for African governments to ensure that their small and medium-sized enterprises (SME) facilitation programmes are gender-sensitive. In other words, those programmes should not reinforce or maintain gender inequalities.

The programmes, such as the Small and Medium Enterprise Division of the Uganda Investment Authority, render necessary support to SMEs. The support comes in the form of entrepreneurship training, business incubation, SME workspaces, mentorship networks, technical skills training for value addition, among others.

However, “[t]hese important programmes have so far been limited in their impact and reach due to their gender-blind nature, in which women are not mentioned or prioritized in planning,” said Reines.

Possible solutions include having a target for the needed number of women to participate in youth entrepreneur training and working with women-based organisations that will enable governments to better disseminate information about such programmes to women entrepreneurs.

These strategies and others are needed in order to increase and better women economic participation, considering that they form more than half of the continent’s population. Moreover, SMEs are the main job creators in the continent and women own around a third of all SMEs in Africa.

In a nutshell, “the potentials of a demographic dividend in Africa can only be harnessed if women are promoted as full economic citizens in the inclusive growth process,” said Reines.