For the first time I had a privilege to participate in East Africa Business Summit that took place in Kigali at Serena Hotel. Head of states from Rwanda President Paul Kagame and from Kenya Uhuru Kenyatta had graced the summit as a way to show its importance to our region business development.
Participants at this strategic think tank deliberated on a number of business and technological issues that are actually dominating headlines. Among key issues that were discussed included regional integration, natural resources exploitation, infrastructure development, skills gaps, Information and Communication Technology among others.
I appreciated the remark by President Uhuru Kenyata when he challenged business community to source goods and services from East Africa before going to China or elsewhere. I think it will be impossible for our industry to develop if our mindset doesn’t change. I guess one of the reasons we don`t create as much jobs as needed is that we always import goods and services instead of buying from local suppliers. Let me note that Chinese mindset is to first check for a local supplier before importing.
A panel on oil, gas and mineral resources drew my attention. Panelists and leaders in private sector discussed about opportunities and challenge East Africa is facing when it comes to their exploitation. It is a fact that our governments will generate a lot of money from these resources exploitation. But it is not yet clear how the money will be invested for the sustainable development of the region.
As I followed deliberations on this topic, I started doubting whether East Africa is really ready to exploit these resources for the benefit of its people. Panelists agreed that oil and gas will contribute a big share in East Africa GDP but no one convinced me that we won`t end up like Delta Niger. The latter is a region in Nigeria where oil exploration polluted that region and created more problems than solutions.
From my understanding it seems like multinationals that won tenders to exploit oil and gas are better prepared for the venture than our governments. Panelists argued that the region lack local skills in oil exploitation, waste management among other skills. In addition to that our government legislation are not up to date in this sector.
Other challenges are that communities where oil will be exploited haven`t yet received compensation for their lands and risk to be marginalized. These are some of issues I personally concluded from discussions in addition to corruption where wrong companies end up getting licenses.
A member of the audience argued that our government seems to be reinventing the wheel in oil and gas exploitation. He said that governments in East Africa should learn from other African countries that are experienced in oil industry. This will help them to learn from mistakes that took place in those countries and use them to their advantage.
Participants in this panel agreed the imperative of adding value to our resources and that this has to be part of the equation. History has taught us that having natural resources isn`t enough for economic development. The summit deliberated on issues of skills gaps that East Africa and the whole of Africa are still facing.
President Paul Kagame pointed out that the most important resources we have are not underground but human resources. As business change with time, a question was raised on how East Africa should ensure that its workforce is relevant to new business realities.
During his presentation on “engaging a 21st century workforce”, Thiru Pillay from Deloitte in Southern Africa said that a seismic shift is happening in this regard. He noted that more than 70% of companies think that their workforce is not capable and believe that workforce development is a serious challenge. It is true governments have done a lot of work to make sure that a big number of its young people go to school but quality is still a problem.
The main challenges that the region face when it comes to workforce development is that our schools are producing graduates whose skills are irrelevant to market realities. The region doesn`t have enough qualified technicians that are needed in key sectors such as natural resources exploitation, ICT among others.
To avoid creating mismatch between what kind of skills businesses need and what our schools produce, Betty Maina from Kenya Manufacturers `Association suggested that private schools should play a leading role in this regards.
East Asian countries termed as Asian tigers did not have natural resources to develop. They designed clear strategies, policies and governance in skill development and it paid off. Thiru Pillay gave an example of Germany where students spend time in schools but also in industries for them to acquaint themselves about workplace realities. It was therefore suggested that industries need to collaborate with schools in order to influence each other on the kind skills needed in the marketplace.
As young people now have access to internet and are capable to use computers, this new reality is set to change how they learn. Betty Maina noted that in the future critical skills companies will need are that of innovators. The chief executive officer of Kenya Manufacturing Association said that companies will need problem solvers. She said that companies need to send a clear signal to schools and universities about the kind of skills they need.
Market realities are constantly changing and the region has now seen the rise of mobile technology. The latter has already started to change the way business is being conducted. A few years ago no one could predict that money can be sent via mobile phone. As more and more people have access to Smartphone, mobile commerce will also become a new reality.
I am glad that East Africa is now a vibrant community although challenges to integrate its economies still persist. During a lunch I happened to be sitting next to a delegate from Tanzania and we discussed about free movement of labor. People from Rwanda, Uganda and Kenya can now freely move and work in these countries without work permit. Tanzania is still reluctant about this move and the removal of other non tariff barriers.
According to the Tanzanian delegate, Tanzania is reserved because of its bad experience that resulted from the collapse of the first East Africa community in 1977. This organization was originally founded by Kenya, Uganda and Tanzania in 1967. Due to misunderstanding between the then member’s states, it failed to achieve its objectives but was later revived on 7 July 2000.
I think that most of the time we learn from our past mistakes. I believe now that lessons were learnt and that as people meet and discuss about their issues, solutions are found and they move forward to a bright future.