Africa Speaks

Africa Speaks A Collection of Speeches

The right of Tony O Elumelu to be identified as the author of this work has been asserted by him in accordance with the copyright laws.

ISBN Paperback: 978-978-55255-1-9 Hardcover: 978-978-55255-2-6

Published in Nigeria in 2016 by Narrative Landscape Press 9 Odunlami Street, Anthony Village, Lagos State +234 909 055 4406 - 7 [email protected] www.narrativelandscape.com

Cover Design by AI’s Fingers Text Layout and Design AI’s Fingers Contents

Introduction – The Beginning

1 My Vision for Africa and Next Steps 3

2 Employee, Employer, and Empowerer: 13 Pathways to Success and Impact in an Uncertain World

the vision

3 How I Am Changing the World 29

4 The Story of Champions: The Model of a 35 Fulfilled National Business Champion

5 Empowering The Next Generation of 47 African Leaders

6 Only in Nigeria Is Our Story Even Possible 55

7 A New Type of Philanthropy: Africapitalism 63

8 The Private Sector Can Help Change the 75 World

9 Powering Africa’s Future: Examining the 83 Power Africa Initiative the message

10 Partnership in the Post-2015 Development 93 Agenda

11 Strengthening Entrepreneurship and 105 Impact Investing through Philanthropy for Sustainable Development

12 The Role of the African Private Sector in 119 the Continent’s Development and Regional Integration

13 Leadership Conversation: Investing in 127 Prosperity

14 Transforming Africa Through Agriculture 135

15 Challenges and Opportunities in the Power 143 Sector in Africa

16 Entrepreneurship, Corporate Social 149 Responsibility and Africapitalism

17 The Private Sector’s Role in Expanding 163 Access to Electricity Across Africa

18 Increasing Economic Ties: Investment 173 Opportunities in Africa

19 Building a Global Conglomerate on 179 Corporate Governance Values

20 A Continent Connecting: Solutions from 193 Within 21 Achieving Success in Africa through Trade 205 and Entrepreneurship

22 Shared Purpose in Developing Agriculture 215 in Africa

23 Attracting the Private Sector to the Medical 227 Sector

24 Long-Term Investment in Africa 233

25 Inspiring Entrepreneurship in Africa 243

26 The Philosophy of Africapitalism in the 253 Power and Energy Sectors

27 Advocacy for the Progress of the Power 261 Sector in Nigeria

28 The Collaboration of the Public and Private 267 Sector Especially in Eastern States

29 Providing Accessibility for Entrepreneurs at 279 the Legislative Level

30 Africapitalism as a Catalyst for the 285 Development of Africa

The Future

31 Tear Down These Walls 303

32 A Call to Partner with Africa 311 33 Changing the Narrative on Africa in a 317 Changing Administration

34 Leadership and Entrepreneurship: The 327 Challenges and Opportunities for Nigeria’s Future Leaders

35 Building Stronger Economic Ties Between 339 France and Nigeria: An Africapitalist Approach

36 Realising the Full Potential of the Nigerian 349 Economy Through Proactive Capital Market Legislation

37 Fulfilling Promises: The TEF Stakeholder 357 Challenge

38 Realising Democratic and Economic 365 Dividends of Tunisia’s “Dignity Revolution”

39 Challenges and Opportunities in African 373 Leadership

Quotes

Quotes about the Power of Vision 386

Quotes about Africapitalism and 388 Entrepreneurship

Quotes about the Future of Africa 390 Africa Speaks: A Collection of Speeches

The Beginning

Africa Speaks: A Collection of Speeches

My Vision for Africa and Next Steps

Speech delivered at the send-forth ceremony of Tony Elumelu, CON – Group CEO, UBA (2004 – 2010), Lagos, Nigeria 31 July 2010

3 Tony Elumelu, CON

As I leave UBA today, I want to dedicate my material resources, professional expertise and energy in developing and assisting a crop of Africans to take business excellence and entrepreneurship to the next level.

– Tony Elumelu, CON

4 ood evening, and thank you to all our friends gathered here today to celebrate this historic and mo- Gmentous event. It is indeed historic and momentous because a smooth transition has occurred, and as they say: “the true test of success lies in succession”. It is one thing to be successful, but it is another thing to successfully handover to people who can take the institution to next heights. To Philips and his colleagues, to whom we have passed the baton, the true test of your leadership and success lies in your ability to surpass all key stakeholders’ expectations. We have confidence in your ability to do this. Capable co-executives as I call them or co-CEOs, will support Phillips on this journey. In UBA, the fact is, we are blessed with so many executives who are capable of functioning as CEOs. For instance, following the stress test conducted by the Central Bank of Nigeria on the banking industry, five of our tier-two leaders were appointed tier-one leaders to manage the rescued institutions. This attests to the calibre of people we have in the UBA Group. I have tremendous confidence in Phillips, as well as Faith Tuedor-Mathews, my friend whom I remember with a lot of excitement and promise; Victor Osadolor, who has been in the trenches with me; Emmanuel N Nnorom, a calm and mature mind on our executive team, the pastor as

5 Tony Elumelu, CON we call him because of his spiritual development; Kennedy Uzoka, a man who has been with me since we dreamt of Standard Trust Bank; and AJ Bello, who spoke so eloquent- ly about the UBA Africa dream in the legacy video we just watched. Femi Olaloku, who made it possible to connect all our eighteen countries online in real time, ensuring that our service delivery remained uninterrupted and we were able to serve our customers at the same level across the African continent. He is the man to whom we give a lot of credit as it relates to the UBA New York redemption exercise. Ifeatu Onejeme, who has had the unfortunate or fortunate responsibility of being my chief of staff, has shown early successes in his appointment. To be TOE’s chief of staff is a tough role. I send an email at 3 a.m. and by 6 a.m. I am already asking him why he has not responded. It was tough on him but he coped. How can I not talk about Abdulrasheed Olaoluwa, the man I spoke about singularly in the legacy video? When we started the UBA dream, we had a three-tier strategic intent: to become the leading financial services group in Nigeria, to become the leading financial services group in Africa, and to become a player in the global financial space. So many

In UBA, the fact is, we are blessed with so many executives who are capable of functioning as CEOs.

6 Africa Speaks: A Collection of Speeches of us were occupied with the responsibility of achieving the first-tier strategic intent, which was to become a key strategic player in Nigeria, but just one man was charged with the responsibility of actualising our African dream. I would like to specially recognise Abdulrasheed Olaoluwa for the good work he has done, and to all the UBA Africa executives present here. I would like to say thank you to our group directors for steering the direction of this organisation well during the good and challenging times, to all the staff of UBA, to our customers, investors, our regulators, all our other key stakeholders for helping to realise our three-tier strategic intent of making UBA a key player in Nigeria, in Africa, and in the world. In Nigeria, following the merger we had four hundred and twenty–eight branches. Today, we have over seven hundred branches in Nigeria alone. Before the merger we had forty ATMs, today we have the biggest ATM network in the industry – over one thousand six hundred and eighty. Also, before the merger we did not have an offshore branch, besides New York, which was a branch of UBA, but today we have eighteen plus two new countries (because at the end of this financial year, we shall commence full operation having received regulatory approvals to operate in these two countries). Thus, bringing UBA operating countries to twenty, from a one-country institution at the time of the merger in 2005, just five years ago. Therefore, you can understand why I would single out and commend Rasheed Olaoluwa for what he has done with his team – the country CEOs who have been driving our

7 Tony Elumelu, CON

UBA African expansion, making sure that we actualise it and that it begins to add significant value to the bottom line. By twelve midnight, this will be history; what will be remembered is not the past, but the present and the future. The future for UBA lays squarely in the hands of the new team, which will be led by Phillips Oduoza, a First Class En- gineering graduate. Therefore, we would be handing over to a man that is intellectually and mentally alert, and he is lucky to be supported by the likes of Faith Tuedor-Mathews, an amazon in the Nigerian banking industry, Victor and the other executive directors mentioned earlier. I have complete confidence in the new team’s ability to take UBA to the next level. As I retire from UBA following the regulatory pronouncement, many of you here have wondered: what’s next for Tony Elumelu? I would like to share that with you today. I have two passions – entrepreneurship and philanthropy. On entrepreneurship, I will from tomorrow, have a new identity – chairman of Heirs Holdings. Heirs Holdings will help to foster economic prosperity across Africa through investments in key sectors such as infrastructure, financial services, real estate, and natural resources. We owe it to other Africans: to the young, hardworking, intelligent, and enterprising Africans to create a prosperous and good future for them. To give them hope, to allow them learn from us and guide them in making sure that they do not make the mistakes that we have made. There is no great man who has not made mistakes in rising to the top. So I will reach out to partners to join me to make sure that Africa has a future generation of business leaders across all levels.

8 Africa Speaks: A Collection of Speeches

I would like to say thank you to our group directors for steering the direction of this organisation well during the good and challenging times, to all the staff of UBA, to our customers, investors, our regulators, all our other key stakeholders for helping to realise our three-tier strategic intent of making UBA a key player in Nigeria, in Africa, and in the world.

Regarding philanthropy, I have incorporated the Tony Elumelu Foundation, which will help to develop business excellence and leadership in Africa. We are in the process of appointing a CEO. My family office will endow a certain amount of money every year to this cause and the UBA family has been kind enough to cede a certain amount of money to the foundation every year. I have networks and partnerships across the world that have also agreed to support this initiative. We all share a common belief; the belief that Afri- ca’s future lies in the destiny of Africans. We as Africans will play our own role in making this a reality. We will help to identify, groom and encourage young African entrepreneurs to realise their full ambition. I had an opportunity to be mentored by some people. I was lucky to have somebody like Chief Ebitimi Banigo as my boss at the time, so when my colleagues tell me today, “Tony you respond too fast to our emails”, I laugh because I learnt it

9 Tony Elumelu, CON from the master himself – Chief Ebitimi Banigo. When I sent memos to him, he would respond within twenty-four hours; therefore, why should I not respond even faster in this age of technology? We need to encourage people. Africa is in dire need of role models. All of us or those of us who have succeeded in Africa owe it to the younger generation of Africans to provide role models, to create hope, and to let people understand that they do not need to be born with a silver spoon to actualise their aspirations in life. Everyone says that Africa is the last frontier. We could keep saying this forever, but the difference in realising the potential of this opportunity – our opportunity – is in our power of execution to realise the potential of Africa being the last frontier. So I hereby call on everyone in this hall to rise up to the challenge. Let it start from this hall and all the millions of Africans who are watching us from across Africa and every part of the world! Nations cannot develop without entrepreneurs. Gov- ernments should occupy itself with creating the enabling environment for businesses to thrive such as providing infrastructure, power, telecommunications, roads as well as the soft infrastructure such as the rule of law. These, in my

As I retire from UBA following the regulatory pronouncement, many of you here have wondered: what’s next for Tony Elumelu?

10 Africa Speaks: A Collection of Speeches view, are things our government and governments across Africa should focus on. They should encourage and allow the entrepreneurial spirit of our people to thrive. In fact, governments should deliberately identify and encourage the rise of entrepreneurs in Africa. I strongly believe that Africa as a continent is well endowed with resources. We need no gifts and we need no handouts. We need to develop our people and become the real managers of our nation and its endowed resources. In economics, we were taught the factors of production, and we were told that entrepreneurship is one of the most important things that foster economic development. There- fore, we need to harness, develop and deliberately encourage our people to become more entrepreneurial. As I leave UBA today, I want to dedicate my material resources, professional expertise and energy in developing and assisting a crop of Africans to take business excellence and entrepreneurship to the next level. Thus, from the abundance of entrepreneurs, best practices and good leadership in the private sector, we could have leaders in the public sector who push this further. I believe that what we need in Africa are people to harness her resources meaningfully for the good of everyone. I will not end my appreciation without recognising my two families: my first family led today by my mum, Chief Mrs. Elumelu, who is here with us. My elder brother Pe- ter Elumelu, my immediate younger brother Hon. Ndudi Elumelu, my two sisters, Agatha and Lauretta, and all the members of the Elumelu family who are here with us today. And to my immediate family, I say thank you to my dear wife, Dr. Vivian Awele Elumelu, for creating the enabling

11 Tony Elumelu, CON environment at home. Thank you so much for your friend- ship and support. To PO and his dear wife, we say congratulations. As you take on a new responsibility, we indeed have confidence in your ability to exceed all our expectations. May God guide you, grant you all wisdom and help you exceed all our expectations. I would like to thank all of you. We should celebrate today indeed, as it is a rare opportunity to have the honour and grace of God to graciously retire in this manner. Thank you very much and God bless you all.

12 Africa Speaks: A Collection of Speeches

Employee, Employer, and Empowerer: Pathways to Success and Impact in an Uncertain World

Speech delivered at Babcock University Postgraduate Graduation Ceremony, themed, Encouraging Graduates to Become Self- Reliant 4 June 2015

13 Tony Elumelu, CON

Entrepreneurship is how we become masters of our destiny and tackle the serious challenge that poverty and mass unemployment pose to the stability of our societies and economies.

– Tony Elumelu, CON

14 am pleased to be invited to speak at one of Nigeria’s leading private universities. I would like to thank Prof. IJames Makinde, the Vice Chancellor and President of Babcock University, for personally inviting me here. I also want to say thank you to my colleagues at UBA, Prudence Mordi and Ayoku Liadi, for working hard to ensure I am here today. To the postgraduate class of 2015, congratulations on being awarded another degree. You have demonstrated a commitment to improving yourself and inspiring others. Your families must be proud of all of you. I earned my postgraduate degree in 1988. The day I had my graduation ceremony, I could not post my graduation photos on Facebook because Mark Zuckerberg was still a toddler. I could not dance azonto at my graduation party because frankly, we had not figured out that we could be so creative with our legs. That said; the year 1988 is in many ways like 2015. I, too, was heading out into a world at a time of uncertainty. Nigeria – and much of Africa – was under military rule with no end in sight, and the Cold War was still at its peak, with a nuclear war still a real and looming possibility. Oil price was around $15 per barrel. It was a time of global uncertainty, like we face today. In 1988, the World Bank estimated the outstanding external debts of developing countries to have reached $1,320 billion. This posed a serious

15 Tony Elumelu, CON problem for the sound development of the world economy and the international financial system. The Nigerian government, in response to the economic crisis, introduced the structural adjustment programme (SAP) and reduced fuel price subsidies. Parents here will remember the chaos that followed: transporters raised their prices, workers went on strike, and students held protests. Today, we are in the midst of another economic crisis. You have seen the headlines: youth unemployment rates are soaring, not just in Nigeria, but also across Africa. As I look at you – Babcock’s postgraduate class of 2015 – it occurred to me that many of you might be looking toward the future with the same trepidation I had when I was sitting where you are now twenty-seven years ago. I have deliberated hard about addressing you today. I have asked myself what I wish I had known at my own graduation, and what important lessons I have learned in nearly three decades since I was in the seat you are in now. Two answers came to me. On this wonderful day when we are all here to celebrate your academic success, I have decided to share with you the pathways to a successful career. First, you have grown up in a highly connected and globalised environment. You have access to new technology, and new ways of communicating and working together – opportunities I never had as a student – yet some of you might feel like you lack what it takes to take advantage of these opportunities. So, today I will talk broadly about how you can achieve success as an employee. Secondly, I will discuss how you can create opportunities for yourself and others, through entrepreneurship, and then I will conclude by discussing the art of empowering

16 Africa Speaks: A Collection of Speeches others. Empowerment is not just crucial for young people; it is crucial for everyone. In empowering others, we develop our country, our continent, and our planet. When people graduate, the natural thing to do is look for a job. Sadly, a postgraduate degree is no longer a golden key that opens doors at workplaces where people are falling over themselves to give you the job of your dreams. A recent survey of CEOs in the UK highlighted their concerns that young people’s horizons were not broad enough for a globalised and diverse economy. The story is not entirely different in Nigeria. In a report by Philips Con- sulting, CEOs were not impressed with graduates’ critical and analytical thinking skills as well as their ability to work well on their own. However, the good news is that many organisations now have developmental programmes meant to equip graduates with the business, analytical and leadership skills needed to be successful in the companies. At UBA, we have the UBA Academy, which we set up in 2008 to train and develop our workforce, so they can continue to be the best professionals in the world. Our dedicated learning and development professionals are always working on closing any competency gap in our workforce.

A recent survey of CEOs in the UK highlighted their concerns that young people’s horizons were not broad enough for a globalised and diverse economy. The story is not entirely different in Nigeria.

17 Tony Elumelu, CON

However, I did not start my career in a training academy; rather, I started at All States Trust Bank, and I will share with you a few things I learnt as an employee. After my initial training programme at All States, it was tempting to assume I would be given a period of grace to get to a hang of the job. Far from it. There were customers to attend to, and loans to structure; so I hit the ground running immediately. In the process, I learned innovation. I challenged paradigms. I worked harder than most people. I learned how to turn abstract information into reports for my bosses. I learned how to make presentations, drive hard negotiations, and close a deal. I also learned teamwork. Postgraduate class of 2015, you will get nowhere if you do not get on with those around you whether they are your superiors, peers, or subordinates. In the bank, some people focused on the short-term gains – the biggest bonus and the exciting job title. But I learned the hard truth – one needed to be patient and wait for the opportunities to arise. The most important things I learned were hard work, resilience and excellence; therefore, my advice to you, postgraduate class of 2015 is to work hard so you can stand out. Hard work and excellence made my bosses Toyin Ak- in-Johnson and Ebitimi Banigo notice, and subsequently, believe in me. At twenty-seven, I went from being a boy to being a boss when I was appointed a branch manager at the bank – the youngest bank branch manager at that time. All the things I had learned earlier came to play, and I continued learning. I learned that I had to be absolutely comfortable managing people who were older than me. The best ideas never came from me operating alone in a silo, or from the man-

18 Africa Speaks: A Collection of Speeches

The most important things I learned were hard work, resilience and excellence; therefore, my advice to you, postgraduate class of 2015 is to work hard so you can stand out.

agement team operating alone; it came from the people I managed. I learned to listen, to be decisive and to be fair, but show firmness where necessary, but above all, to learn from everyone. I am telling you this story so that you understand how much you can achieve with excellence and hard work. The times we live in have been quite challenging, but the reality is, you need to be bold and courageous. Do not let your journey end before it even begins. I would like, at this point to acknowledge two Bab- cock graduates who currently work for me: Odiri Oginni, who studied Accounting here at Babcock and now works at the finance department of United Capital Plc., and Adeola Oduntan, who read Computer Science and now works in the IT department of the same company. Well done to the faculty and staff of this institution for feeding hungry minds and equipping them with the tools they require succeeding in their chosen fields. Education is not just about learning in the classroom, it is also about learning how to cope in the outside world. Some graduates have no problems coping in the outside world. I have met many young men and women who went straight from university to a boardroom. A rising

19 Tony Elumelu, CON number of young entrepreneurs are defying the economic downturn by launching their own enterprises. This is happening not just in Nigeria, but also all over the world. In the UK, a new generation of young business owners are leading the way out of the economic crisis. Ac- cording to the annual Simply Business Start-up Index, there has been a 29 per cent rise in firms started by 18 to 25 year- olds since the recession began in 2008. It takes a leap of faith, transitioning from a classroom to your own business. But it is a leap that can be rewarding for you and others as well. And this brings me to the second part of my speech – entrepreneurship and how people can succeed by working for themselves. A few of you have probably applied for jobs through the online site Jobberman.com. Now, how many of you are aware that Jobberman was co-founded by three university students who shared the same interests? These students started the business at the Obafemi Awolowo University campus during the industrial strike action by Nigerian Ac- ademic Staff Union (ASUU) of August 2009. These three students defied ASUU and the prevailing challenges and circumstances at the time, and started Jobberman, because it

Entrepreneurship is how we become masters of our destiny and tackle the serious challenge that poverty and mass unemployment pose to the stability of our societies and economies.

20 Africa Speaks: A Collection of Speeches required little capital and there was a huge market for their product. Today, the firm is Africa’s leading online job site. This is entrepreneurship. Entrepreneurship means you no longer have to wait to see who will give you a job, instead, you can seize the opportunity to secure your future and in the process, create jobs and livelihoods for others. Entrepreneurship is how we become masters of our destiny and tackle the serious challenge that poverty and mass unemployment pose to the stability of our societies and economies. However, unlike the team at Jobberman, I did not become an entrepreneur straight from the university. I gradu- ated, got a job and climbed the corporate ladder. While I was at All States Trust Bank, my mentor, Ebitimi Banigo, helped me to develop my strategic thinking and to channel my ideas into concrete actions. I learnt all about leadership and how to run successful businesses. So when the right moment arrived, in my early thirties, I had the self-belief to make the switch from employee to employer. My partners and I surveyed the banking landscape at the time, and knew that more than one hundred banks in Nigeria would be in trou- ble. We set up a company that would focus on turning these troubled banks around. In 1997, my partners and I took over the shuttered Crystal Bank and rebranded it into Standard Trust Bank (STB). In no time, we were out-performing most of the other banks in Nigeria. How did it happen? We achieved unprecedented growth through innovation and by pursuing the customers who did not previously have bank accounts or had limited access to mainstream financial services. This approach helped create a culture of responsibility and accountability. It also facilitated

21 Tony Elumelu, CON payments, and opened up access to credit for tens of thousands of financially disenfranchised Nigerians. Though economic profit was our primary motivation, we made it easy for people to have access to banking services. This made me understand that even when a business pursues profit, it can also deliver a meaningful social return as well – this was the foundation of the economic philosophy of Africapitalism, which guides the way I conduct business and make my investment decisions. The success of STB allowed us to merge with the much larger United Bank for Africa (UBA), in 2005. But, we wanted to do even more, so we opened bank subsidiaries in eighteen other countries across Africa, and repeated the same model that we created in Nigeria, targeting customers who had never opened a bank account before or were being poorly served or underbanked. Today the United Bank for Africa has millions of customers in nineteen African countries, supported by over twenty thousand employees. So though I started my banking career as an employee, twenty-seven years later, my group of businesses have become one of the largest employers of people in Africa. At Heirs Holdings, we measure our success not only in terms of profits, but also on how we help to create social wealth for all Africans. When I left UBA in 2010 to pursue other interests, I made a promise that through the Tony Elumelu Foundation I would institutionalise luck and create one thousand more UBAs. I wanted to leverage on the success I had enjoyed to empower the next generation of African entrepreneurs to also succeed.

22 Africa Speaks: A Collection of Speeches

In entrepreneurship, it is important to remember that it is a long-term journey and that nothing is ever easy or perfect. You can start with an idea and over time you can refine it as the market or demand changes. If you are waiting for the perfect time, you may never get started. Over the past three decades I have spent as a banker, investor, and turnaround manager, I have had the opportunity to meet thousands of entrepreneurs like me. Many of them young people with incredible dreams and business ideas but without the experience or the access to mentoring and support required to build successful businesses. I have also met entrepreneurs who are already running home-grown businesses and have a clear understanding of the local market. Like the team that founded Jobberman, they can identify gaps in the marketplace for specific products and services. Yet, many of these budding entrepreneurs often lack the capital, the networks, the training or the support to take their strong small businesses to national or regional scale. And that is why I launched the Tony Elumelu Entrepreneurship Programme, also known as TEEP. The objective of the programme is to identify and provide mentoring, training, networking, and funding for one thousand African start-ups per year for the next ten years. Through the programme, I have committed $100 million to support the next generation of African entrepreneurs. These may be the next UBAs. TEEP kicked off on 1 January 2015, and by the time we closed the application portal two months later, we had over twenty thousand applications from fifty-four African countries and territories. Eventually, with support from Accentu- re and a pan-African committee, we selected one thousand

23 Tony Elumelu, CON amazing entrepreneurs from fifty-two African countries. These entrepreneurs are currently undergoing an intensive twelve weeks online training programme with the support of over four hundred mentors from around the world. In July they will all come to Lagos for a boot camp to close the formal training aspect of the programme. I am delighted to say that a Babcock graduate is one of those chosen to join the Tony Elumelu Entrepreneurship Programme class of 2015 – Tejumade Fola-Alade, who holds a Bachelor of Arts in English Studies. After a brief stint with a major online retailer, she is going off to start her own online firm. Good luck to her as she begins the journey towards self-dependence. We hope that TEEP, over the next ten years, will create ten thousand African-owned businesses, generating one million new jobs and contributing $10 billion to revenues across Africa. In closing, I want to say to you that your education does not end here. It begins now, so always approach life’s new experiences with an attitude of learning. I have presented to you two valid paths you can follow to succeed in your career, whichever path you choose, remember to be hardworking, creative, innovative, energetic and passionate about what you do, and always have the courage to seize opportunities. Remember also that you have been empowered by your education, so you must ensure that whatever you choose to do, think about how you can give back to your community by empowering others to take charge of their own lives and well-being. Recognise also that your country and your continent are your communities. Do not allow your religion, ethnicity or

24 Africa Speaks: A Collection of Speeches nationality to become the chains that limit your vision, your network and your ambition. Rather, use them as bridges to expand your world by embracing their common principles of humanity, solidarity, charity, honesty and the search for the common good. These principles will enable you live anywhere, be- friend anyone, trust the best in everyone and bring down all barriers and boundaries that could hold back your success. I tell you this because I was born in Jos, Plateau State. I studied in Bendel State University, Edo State. I went to the Uni- versity of Lagos. I did my National Youth Service in Sokoto. I work in Lagos and my businesses are all over Nigeria – and I am the better for it. Under governor Fashola, one of our companies was given a rare opportunity to develop the Falo- mo Shopping Centre in the heart of Lagos. I am from Delta State. I am not from Lagos State – that is the new Nigeria. That is what it is all about – bettering ourselves, bettering our communities, and making a better future for the next generation of Africans. Your generation is capable of making a better Nigeria. Your families and your teachers believe in you, and more importantly, Nigeria needs you. Con- gratulations on your achievement. I pray that you all succeed in your chosen careers, and that through you our nation will continue to be a shining example to other nations. God bless you.

Africa Speaks: A Collection of Speeches

the vision

“What will be remembered is not the past but the present and the future.”

– Tony Elumelu, CON

Africa Speaks: A Collection of Speeches

How I Am Changing the World

Speech delivered at the Banque Publique D’investissement (BPI) France the Big Event, Paris France, themed, Changing the World Through Entrepreneurship 25 May 2016

29 Tony Elumelu, CON

I wanted to institutionalise the luck I’d had as a young entrepreneur and democratise the opportunity by giving every aspiring African the chance to benefit from it.

– Tony Elumelu, CON

30 y name is Tony Elumelu. The clip you have just seen is from the Tony Elumelu Entrepreneur- Mship Programme (TEEP) boot camp in 2015. This was a gathering of one thousand entrepreneurs from across Africa – all beneficiaries of TEEP. Like you I want to change the world. I want to change the world by changing the narrative about Africa. For many people when they hear the word Africa, they think of animals, poverty, disease, darkness and backwardness. People believed similar things about Chi- na, Brazil and India at one time, but now these countries are economic powerhouses, and the narrative has changed. They call them by the acronym, BRICS – Brazil, Russia, India, China and South Africa – or emerging markets,, etc. I want the same for Africa’s fifty-five countries. I want to help stimulate the economic transformation of Africa and help it take its rightful position as a strong regional player in the international community. So that when people think about Africa, they think about opportunity. This is possible, because I am evidence of it. I was born in Africa, educated in Africa and have spent my whole career working in Africa. You might say I was made in Africa and I made it in Africa. I have been a banker for nearly thirty years, but I also have interests in other sectors including agriculture, real estate, healthcare, and energy, among others. I have been very successful in these sectors

31 Tony Elumelu, CON using an economic philosophy I developed called Africap- italism, which advocates long-term investments in strategic sectors that generate both economic dividends for investors and social dividends for society. I am a successful Africapi- talist today, but I started out just like one of the young men and women in the clip you just saw. In fact, thirty years ago, you could not have picked me out of a group. I evaluated my journey to success and came to understand that in addition to hard work, passion and drive, I was a very lucky guy. I had unique ideas, I benefitted from the attention of a mentor who helped me develop my business acumen, and when a group of young bankers and myself set out to take over a distressed bank and turn it around, I found someone who believed in me and invested their capital to enable us buy the distressed bank. Today, that bank is called the United Bank of Africa and it serves eleven million customers in nineteen African countries. Thirty years later, having understood and embraced the responsibility to give back to the continent, I decided to pay it forward by creating more “Tony Elumelus” and “UBAs” to help transform Africa. I want to institutionalise the luck I’d had as a young entrepreneur and democratise the opportunity by giving every aspiring African the chance to benefit from it. So, my foundation created the $100 million Tony Elu- melu Entrepreneurship Programme to train, mentor and give seed capital to ten thousand African businesses over the next ten years, create one million new jobs and $10 billion in additional revenue across Africa. These entrepreneurs will achieve financial success while creating home-grown solutions to local problems in core areas such as food, education,

32 Africa Speaks: A Collection of Speeches

Thirty years later, having understood and embraced the responsibility to give back to the continent, I decided to pay it forward by creating more “Tony Elumelus” and “UBAs” to help transform Africa.

health, water and sanitation, among others; therefore, delivering African solutions to African problems. I want to create the next generation of Africapitalists, who will not only be financial winners in their chosen sectors, but also champions of African development. What I hope you take away from this, particularly those of you here from some of the European economies that are facing tough times is that even in the most trying business climate, with hard work, passion and a great idea, you can succeed. I also want you, my fellow entrepreneurs, to understand that it is not enough to succeed; you have to be a champion. You have to look beyond yourself and use your business to lift others up as you go. Your legacy must be about others and not yourself. And lastly, that Africapitalism is not just for Africa. In your own business, make long-term investments in strategic sectors; secure economic benefits for yourself and social benefits for your community. If you do that, you will not only be a winner, you just might change the world.

Africa Speaks: A Collection of Speeches

The Story of Champions: The Model of a Fulfilled National Business Champion

Speech delivered at the Ivorian National Council of Employers’ 2016 Academy, themed, Winning in Business 21 April 2016

35 Tony Elumelu, CON

…a champion who embodies true greatness is one who carries the fight, refuses to settle for a comfortable existence, thinks about the plight of others, inspires hope and decides to make the aspirations of others their personal fight despite major challenges.

– Tony Elumelu, CON

36 our Excellency President Alassane Outtara; Prime Minister Duncan Cablan; Your Excellency, Prime YMinister Anerood Jugnauth of Mauritius; Mr. Jean Kacou Diagou; My fellow entrepreneurs and Africans; and distinguished ladies and gentlemen. It is an honour to accept the Ivorian National Council of Employers’ Lifetime Achievement Award. I want to thank CGECI’s Chairman, Jean Kacou Diagou, and members of the council for this recognition as an “African Business Champion”. More importantly, I am honoured to be invited to share my business perspective and experiences with you. I want to commend you for having this conversation about the role of business champions in Africa. I will start by sharing my thoughts on champions, and then tell you a little bit about some champions and finish by telling you a bit about the work of the Tony Elumelu Foundation and how it relates to this ideal. When we think about a champion, we often think about an individual who is a winner, that is, someone who has achieved something significant by surpassing other opponents or rivals in a contest, for instance, in professional sports and business. People such as Serena Williams in tennis, Gary Kasparov in chess, and Mohammed Ali in boxing. Consider even, the Ivorian National team, the Elephants, who are the current champions of Africa. These are important achievements and should be celebrated as

37 Tony Elumelu, CON demonstrations of what human beings can achieve when we set our minds to attaining goals or meeting a standard. We must always continue to push the boundaries of physical and mental endurance. However, there is another kind of champion that I think is more important and that is the individual who not only achieves personal success and greatness in their chosen endeavour, but one who carries others along with them or uses their platform to lift others up. These are the greats. A personal favourite of mine is Michael Jackson – a person who combined talent with hard work. Another is Mohammed Ali, who said he was the greatest and then worked harder than most to ensure he deserved that accolade. But Mohammed Ali is a champion not only because of what he accomplished in the ring, but also because of what he stood for. He stood up against an unjust system of racial segregation in the 1960s and defied the most powerful government in the world. A government that was prepared to send him and fellow African Americans to die for their country’s political ideology in the Vietnam War, and yet was unwilling to uphold the civil rights guaranteed to those same African Americans under the constitution of the United States. In refusing to go to war, and confronting his government, Ali brought global attention to the racist and segre- gationist policies that belied the America’s founding philosophy of “Life, Liberty and the Pursuit of Happiness” and in doing so, he helped to advance a movement that secured civil rights and lift up people of colour in the United States. That is a champion and that is greatness. Another example I would argue is the founder of Mi-

38 Africa Speaks: A Collection of Speeches crosoft, Bill Gates. As a young man, Bill Gates revolution- ised the computer operating system and helped propel the world into the digital age through the interconnectivity of computers. And through his marketing genius of his products, he is also arguably the most successful entrepreneur in history. However, if he succeeds in his current philanthropic endeavour, he will more likely be remembered for leading the charge to eradicate polio and for preventing the deaths of an estimated five million children a year from preventable diseases. That is greatness. That is a champion. Essentially, I am saying that a champion who embodies true greatness is one who refuses to settle for a comfortable existence, thinks about the plight of others, inspires hope and decides to make the aspirations of others their personal fight despite major challenges. That is the difference between being a winner and a champion. When it comes to global development and economic growth, I would like to argue that, while other regions may breed and encourage winners, Africa must encourage champions. It is not an option because development is not an option. Our continent faces a lot of challenges and we need individuals who will champion the social and political development, environmental integrity and economic transformation of the continent. I say this because reason tells us, and history has proved to us, that no one can develop the Af- rican continent but us Africans, because no one has a greater stake in it. Outsiders have colonised, pillaged and plundered the continent, and now they visit us, trade with us and are benevolent towards us, but no one can rescue us. We are the ones that we have been waiting for. It is up to us. I have talked about sports, intellectual and philanthropic

39 Tony Elumelu, CON

…there is another kind of champion that I think is more important and that is the individual who not only achieves personal success and greatness in their chosen endeavours, but one who carries others along with them or uses their platform to lift others up. These are the greats.

champions, and we all revere the political champions such as Nelson Mandela and Martin Luther King, whose championing of freedom and equality defined their lives. However, for the purposes of this gathering, I want focus on “business champions”. There are many winners in African businesses and that is a good thing. For everyone that is productive and stands on his or her two feet, the continent is better off. However, it is not enough. Africa has six hundred million people living without access to electricity; millions of kids are out of school; more than four hundred million people are still living in poverty; millions more are chronically hungry or exposed to the haz- ard of food insecurity; and the unemployment rate is about 20 per cent, and often up to 50 per cent in the case of young people. The list goes on. Therefore, Africa needs winners with a cause because that is what champions are – winners with a cause. The business sector is not exempt from the responsibilities of being champions. For too long, governments have been left to solve the challenges that I have mentioned above, and many

40 Africa Speaks: A Collection of Speeches others, with varying degrees of success, while the business sector has focused on its perceived mission – the pursuit and maximisation of profit for shareholders. However, it has become clear that this is not a sustainable way to develop Africa. It has not and will not lead to success for African governments, citizens or businesses, and it will be evident in each country’s GDP. This is because governments cannot create jobs for all their citizens. The majority of jobs are created by the private sector, specifically, small and medium enterprises. MSMEs are the backbone of any economy in the world, and when governments ignore the private sector and do not attend to their obligations to create and sustain enabling environments for businesses to thrive and flourish, the consequences are stark – low GDP growth, mass unemployment, ethnic strife and possibly even food and health crises, and in some cases, violent conflict. Similarly, when the private sector divorces itself from the development agenda and aspirations of the countries and regions in which they operate, they often focus on short-term investments that yield high returns for a few and exclude many. These sorts of ventures often do little to build capacity, increase local value creation, increase government tax revenues, expand employment, raise living standards and solve national or regional development challenges. The results are stagnating economies that not only reflect as failed governance but also limit the growth of the private sector itself. At best, this is basically a recipe for “mutually-assured mediocrity” on the part of both governments and the private sector. I am an entrepreneur, so I will address the private sector side of this quandary and offer a solution. But first, I will

41 Tony Elumelu, CON tell you a little bit about my business to set it in the proper context. I think it is fair to say that I am a winner because I have demonstrably enjoyed a lot of success in business. In 1997, my partners and I took over a failed bank and turned it around. By innovating, leveraging technology and pursuing less affluent customers alienated by the market – many did not have bank accounts – we soon out-performed most of the other banks in Nigeria. Owing to our amazing growth trajectory, Standard Trust became a leading bank in Nige- ria and, in 2005, we were emboldened enough to execute a merger with one of the top three banks in Nigeria – the United Bank of Africa (UBA). But that was not enough. We wanted to win more. We wanted UBA to become a truly pan-African bank. So, we developed and executed a strategy to establish presence in other African countries, and today, UBA employs over twelve thousand people and serves over nine million customers in nineteen African countries, representing Anglo- phone, Francophone and Lusophone citizens, which covers all sub-Saharan African regions. More importantly, we found that though profit was our primary motivation, through the Standard Trust turnaround and UBA’s pan-African strategy, we had helped to democratise access to banking across Africa in the process. Some of it had to do with the decision we made to allow customers in some underbanked countries to open bank accounts with zero balances. That strategic calculation to be patient paid off because, eventually, people brought their money in. I believed that whenever people had an opportunity, they would choose to save – UBA helped to bring millions of disenfranchised Africans into the formal economy.

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This forever altered my understanding of how a business, even in pursuit of profit, should operate. When I stepped down as the CEO of UBA in 2010, and established Heirs Holdings, I was venturing out from my comfort zone as a banker into new territory as an entrepreneur. To help guide my investment decisions, I took some time to reflect on what principles, practices and decisions had underpinned the successes at Standard Trust and UBA, what I had learned and what impact I wanted to make in all my new endeavours. I found that I wanted to create wealth; promote development in Nigeria and across Africa; do it from the private sector; and deliver social benefits to society. And that is how the concept of Africapitalism was birthed. Africapitalism addresses the problem of “mutually assured mediocrity” between the government and private sector operating as separate units, rather than through collaboration. I believe that the private sector must acknowledge and embrace its role in Africa’s development. Africapitalism

…while other regions may breed and encourage winners, Africa must encourage champions. It is not an option because development is not an option. Our continent faces a lot of challenges and we need individuals who will champion the social and political development, environmental integrity and economic transformation of the continent.

43 Tony Elumelu, CON is essentially an economic philosophy to deploy, empower and enjoin private sector participation in the economic and social development of the African continent, through long- term investments in strategic sectors that generate both economic dividends for investors and social wealth for larger society. I knew that if I did this, not only would my new businesses and I succeed or become “winners”, but also we would have a discernible impact on the fortunes and future of the continent. Today, Heirs Holdings as a pan-African proprietary investment company with interests in key strategic sectors of Africa’s economy, including financial services, oil and gas, power, hospitality and real estate, healthcare and agribusiness, is doing precisely what I set out to do in 2010. More importantly, we are champions of African development because we are Africapitalists. Through Africapital- ism, I am seeking to evangelise what works for successful business investments and inspire other entrepreneurs like yourselves to also make the promotion of national and regional development a strategic priority for your businesses. What differentiates Africapitalists from the champions I mentioned earlier is that the pursuit of the cause of development occurs simultaneously with the pursuit of profit, and the economic and societal dividends occur together – that is doing well while doing good. The other objective I want to achieve with Africapital- ism is not only to be a “business champion”, that is to be a winner with a cause, but also to be a “champion of business”. I’ve already described the former. The latter involves the responsibility I feel to replicate my success by helping to create more Tony Elumelus and more UBAs across Af-

44 Africa Speaks: A Collection of Speeches

MSMEs are the backbone of any economy anywhere in the world, and when governments ignore the private sector and do not attend to their obligations to create and sustain enabling environments for businesses to thrive and flourish, the consequences are stark.

rica. To achieve this in 2014, the Tony Elumelu Foundation launched the Tony Elumelu Foundation Entrepreneurship Programme to identify, train, mentor and provide seed capital to ten thousand African entrepreneurs over the next ten years, towards creating one million jobs and $10 billion in additional revenue across the continent. I have committed $100 million to this endeavour over that period. The purpose of the programme is to economically transform the continent by institutionalising and democratising “luck”, so that any African entrepreneur, regardless of nationality, gender, faith, age or sector with a transformative and scalable idea, and the drive to succeed, has the golden opportunity to compete to be one of the best one thousand ideas selected. Hence, the tagline of the programme: “Your Idea Can Trans- form Africa”. I can tell you that Africa’s entrepreneurs are stepping up to the challenge. In the first year, we received twenty thousand applications for one thousand slots, and this year we received forty-five thousand for the next application round. I am delighted to inform you that over the last two years, we

45 Tony Elumelu, CON have had thirty-five beneficiaries from Cote D’Ivoire. Every African country is represented in the programme, but beyond that, the programme works in synergy and leverages the commercial side of our operations. When I meet with high-level government officials across Africa for business reasons, I bring along their country’s Elu- melu entrepreneurs and secure commitments from them on policy changes to improve the enabling environment for all entrepreneurs to thrive. This is part of the Africapitalist’s creed to end “mutually assured mediocrity” by working with “shared purpose” to ensure that the governments’ development objectives are met through private sector investments, and the private sector flourishes. The results would reflect in economic growth and “shared prosperity” that permeates all levels and sectors of African society. Also, the way UBA operates and promotes regional integration through its pan-African operations, the Tony Elumelu Foundation’s Entrepreneurship Programme is promoting regional integration by creating a pan-African ecosystem that fosters creativity, innovation, collaboration and trade between entrepreneurs all across Africa – that is another cause worth championing! In closing, I want to reiterate that I am all for winning, and I know that everyone in this room is a winner or well on their way to being one. But I also want to remind you that winning is not enough – not in Africa and not for Af- rica. Africa needs champions and you do not need anyone’s permission. I have been a winner, but I much prefer to be champion. The question is: what will your story be? Thank you.

46 Africa Speaks: A Collection of Speeches

Empowering The Next Generation of African Leaders

Speech delivered at the Launch of the Tony Elumelu Entrepreneurship Programme, Heirs Place, Lagos, Nigeria, themed, Empowerment Through Mentorship and Giving Back 1 December 2014

47 Tony Elumelu, CON

Entrepreneurship is how we take ownership and demonstrate leadership in our continent’s affairs; it’s not up to anyone else to develop Africa but us.

– Tony Elumelu, CON

48 adies and gentlemen, welcome to this joyous occasion. It is a pleasure to welcome you here today. LI was born, raised, educated and worked all my life in Africa. I am also an entrepreneur, and one who has enjoyed a lot of success in my chosen pursuits. You might say that I was made in Africa, and that means so much to me to be able to make it at home, on a continent handicapped by narratives of hopelessness. Entrepreneurs from humble beginnings like myself, Ayodeji Adewunmi, the co-founder of the Nigeria job search site Jobberman; Monica Musonda, the CEO of Java Food in Zambia; Strive Masiyiwa of Econet in South Africa, not only speak to the potential for success in our homeland, but also gives hope to other budding African entrepreneurs that success is possible, and that they can help build the African we want to live in. But I did not do it all by myself. I believe that one of the key reasons why I made it in business is because, early on in my career in Nigeria, I benefitted from the mentorship of Chief Ebitimi Emmanuel Banigo at All States Trust Bank. Chief Banigo helped me to develop my strategic thinking and to channel my ideas into concrete actions, so that when the moment of opportunity arrived, at the age of thirty-four, I had the self-belief to gather a small group together to take over and revive a failing bank through innovations in our services.

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Over the past twenty years plus that I have spent as a banker, I had the opportunity to meet hundreds of entrepreneurs all across Africa, many of them young people with incredible dreams and business ideas but without the experience or the access to mentoring and support required in order to build a bankable business.

There was a lady too – Rose Ada Okwechime – who bought into our vision by investing in us at the critical early stage when few people had confidence in us because we had little or no track record. Yet, my team and I held onto our bigger dream of becoming a pan-African bank that would serve the whole continent. This dream led us into a merger with UBA Group, and expansion of the new bank into nineteen African countries. Over the past twenty years plus that I have spent as a banker, I had the opportunity to meet hundreds of entrepreneurs all across Africa, many of them young people with incredible dreams and business ideas but without the experience or the access to mentoring and support required in order to build a bankable business. Without these critical resources, these ideas often never make it out of the dream world and into the reality of African soil. I have also met entrepreneurs who are already running home-grown businesses and have deep insights into local

50 Africa Speaks: A Collection of Speeches consumer demand. They can spot unique gaps in the market for specific products and services. They can tap into strong networks and often exhibit a burning drive to create innovative, often disruptive, solutions to complex challenges. These are the people who can fuel our future, but who often lack the capital, the training or the support to take their strong small businesses to national or regional scale. I believe we cannot afford to waste this talent. Demo- graphic trends show that we need to create ten million jobs a year to sustain Africa’s young population, which can spell economic boom or doom for the continent. Governments and big corporates alone cannot provide the number of jobs that are required by the millions of young Africans entering the job market every year. But I believe African entrepreneurs can. Entrepreneurship is how we take ownership and demonstrate leadership in our continent’s affairs – it’s not up to anyone else to develop Africa but us. Entrepreneurship means you no longer have to wait to see who will give you a job; rather, you can seize the opportunity to secure your future, and in the process, create jobs and livelihoods for others. Entrepreneurship is how we become masters of our destiny and tackle the serious risk that poverty and mass unemployment pose to the stability of our societies and economies. I believe that in business “opportunity” is the great equalizer. African entrepreneurs need opportunity in the form of mentorship, capital and business ecosystems that can help them succeed. In other words, we need to “institutionalise” the luck or good fortune that I benefitted from early in my career.

51 Tony Elumelu, CON

This is why I have invited you here today. My life has come full-circle, because today, I the lucky entrepreneur will embark on the journey of giving back to the continent that has given so much to me, at an unprecedented level. Through the Tony Elumelu Entrepreneurship Programme, I am committing $100 million to support the next generation of African entrepreneurs – the next Dangotes, the next Mosepes, the next Jumias, the next Nandos/MTNs, and the next UBAs. The programme represents a decade long commitment to support ten thousand African entrepreneurs and startups. The programme is open to entrepreneurs from all fifty-four African countries. Over the next ten years, our goal is to create ten thousand African-owned businesses, generating one million jobs and contributing $10 billion to revenues across Africa. The programme will seek out and support the growth of African entrepreneurs in any sector or field. We are building an ecosystem to identify and cross-pollinate grassroots innovation across Africa, sparking intra-African trade and accelerating success. The programme will also promote the role of African entrepreneurs within the global supply chain

I believe that in business “opportunity” is the great equalizer. African entrepreneurs need opportunity in the form of mentorship, capital and business ecosystems that can help them succeed.

52 Africa Speaks: A Collection of Speeches and put African innovators front and centre on the global stage. This is far more than a funding initiative or networking opportunity. It is an act of faith in our entrepreneurs and our young people to transform our continent and to be the engine for the creation of both economic and social wealth, in line with the principles of Africapitalism. Business is not just about money; it is about vision, values, plans, drive, community and development. My new dream is that at the end of this “decade of entrepreneurship”, we will have laid the groundwork for thousands of businesses to grow and flourish across the continent, creating new partnerships and trade routes both within Africa and internationally. This is how we will transform the lives of our people across Africa. This is the way we will transform our societies and economies. It is up to us. The media can help by sharing information about this opportunity to reach the entrepreneurs among us, by tracking the progress of entrepreneurs, by telling the stories of their business growth, and most importantly, holding us accountable for this promise of reach- ing ten thousand entrepreneurs in ten years. Thank you again for joining us.

Africa Speaks: A Collection of Speeches

Only in Nigeria is Our Story Even Possible

Speech delivered at the Nigerian Economic Summit, Abuja, themed, Changing the Rhetoric of Investing in Africa and Africapitalism, Abuja FCT, Nigeria 20 November 2011

55 Tony Elumelu, CON

Nigeria is a destination where multinationals can, and do succeed, and where domestic champions are rising and adopting increasingly regional and global strategies.

– Tony Elumelu, CON

56 few weeks ago, the president convened the Presi- dential Retreat with the private sector on how to Amove the economy forward. I had a small window to say something. What I spoke about is not too different from what I will speak about tonight. I spoke about the fact that there is a certain mind-set about Nigeria, and I believe that that is the first battle we need to overcome if we say we want to address the issue of economic development. So when the organisers of the Nigerian Economic Summit approached me with this opportunity, I reflected on what the topic should be and finally came up with “Only in Nigeria is Our Story Even Possible”. You hear stories about corruption, infrastructural challenges, policy inconsistencies, and so on, but despite the challenges; we have so many success stories. Today, I have a few stories that are factual and empirically verifiable. In fact, I will mention names. The first story I want to share is the case of a certain company that I believe you know about. In January 2001, just a little over ten years ago, this company came into the telecommunications space in Nigeria after paying $285 million at the time for a mobile license. The company’s executives and investors saw Nigeria as a very risky bet. Institutional investors punished the company. The company’s stock price dropped for going into Nigeria to do business. Nigeria had extremely limited wireless capacity and was an unproven market. Shareholders were extremely

57 Tony Elumelu, CON wary, but despite all of this, the company decided to come to Nigeria. In the first year of rollout, the company signed on three hundred thousand subscribers. Today, ten years down the line, the company has forty million subscribers. In 2010, the company reported about $17 billion globally in revenue out of which about $5 billion came from Nigeria alone. In terms of the overall subscriber base of the company, about 30 per cent comes from Nigeria, and Nigeria is clearly the most profitable subsidiary of this company. That company is MTN. Only in Nigeria is this story even possible. Now let us talk about a Western company that decided to ignore all of the negative stories about Nigeria. They came into Nigeria in 1962, set up a plant in Ikeja, Lagos, and have continued their operations since. The company faced the issues we always hear about – distribution and logistics challenges, power issues, port congestion, and importation challenges. Where is the company today? In terms of turnover, the company grew close to 50 per cent from about $500 million in June 2007 to about $1 billion in June 2011. Again, they did this despite all the challenges that we have in Nigeria. Operating profit increased from about $94 million in 2007 to close to $200 million in 2011. The company’s emerging markets business is expected to contribute 50 per cent of its global net sales by 2015, up from 34 per cent in 2011. Most of the above has been largely driven by Nigeria been the single largest contributor in Africa. Nigeria is currently the world’s second-biggest market for beverage outside Britain, accounting for 41 per cent of global volume sales. The company has now carved Africa out as an autonomous region

58 Africa Speaks: A Collection of Speeches with Nigeria being the key market in Africa. Diageo Nigeria, producers of Guinness, is the company I am talking about here. Again, only in Nigeria is this story even possible. In 2005, in the financial services’ space, we had a significant consolidation that occurred in Lagos of the fifth largest bank at the time and the third largest bank coming together in what has been described as the largest merger in sub-Saha- ran Africa. In 2005, the consolidated bank was a one-country financial institution that had less than three million retail customers. The bank had a three hundred-branch network and less than forty ATMs. It employed about seven thousand Nigerians and had a total balance sheet size of about $2.5 billion. How does this institution stand in 2011? The bank is present in nineteen African countries, as well as in three major international financial centres – New York, London and Paris. The bank has a balance sheet size of $19.5 billion with more than seven hundred branches across Africa along with almost three hundred thousand ATMs. This bank employs almost twenty thousand employees from across the continent. The bank that I am talking about is UBA. We also have in today’s session one of our best – in fact, one of Africa’s best. He is acknowledged by us here and globally recognised as one of the best this country has produced in terms of entrepreneurship. This company is now one of Africa’s largest industrial conglomerates with extensive interests in cement, flour, sugar, oil and gas, and beverages, with operations in Nigeria, Benin, Ghana and Togo, and rapidly expanding further across the continent. Not too long ago, despite market corrections, this company was listed on the stock exchange at about $12 billion. In fact,

59 Tony Elumelu, CON

Nigeria is a destination where multinationals can, and do succeed, and where domestic champions are rising and adopting increasingly regional and global strategies. Nigeria is full of people who are entrepreneurial, innovative, and ready to leverage opportunities and adopt technology.

this company and UBA were the only Nigerian companies ranked by Boston Consulting Group among its top forty African Challengers of 2010. That company is Dangote Group. And only in Nigeria can this type of story happen. Let us go to the entertainment sector. Ola Balogun and Hubert Ogunde made the first major Nigerian movies in the 1960s, but it was not until 1992, that Kenneth Nnebue, who launched a new era in filmmaking, produced the successful Living in Bondage movie. Despite piracy, the industry remains a firm growth sector with 70 per cent yearly average surge in the number of movies registered between 2000 and 2006. It is now a $250 million industry, second only to India’s Bollywood, and offers thousands of jobs. The industry is the second largest employer in Nigeria after agriculture. I am sure you know now that I am talking about Nollywood. Only in Nigeria is this story possible. So what do we learn from these stories? First, Nige- ria has an extraordinary demographic profile – people be-

60 Africa Speaks: A Collection of Speeches low twenty-nine years of age account for over 50 per cent of our population. That’s huge. In terms of workforce, we have a lot of people who are employable, productive and well trained, both within the country and in Diaspora; people who are ready to return and take up challenges that exist in Nigeria and will assist investors and companies that want to do business in Nigeria. Nigeria remains one of the fastest growing economies in the world with a GDP average growth rate of 8 per cent despite the economic crisis that the world has gone through. I heard one of the discussants this morning talking about mining and petroleum. Nigeria has almost everything. We want people – Nigerian entrepreneurs, foreign associates and Africa-minded foreign business investors – to take advantage of the opportunities in this economic space. We have, as a country, embarked on a reform programme that Dr. Shamsudeen Usman is a key part of, and we listened to the President of Nigeria today reinforce the importance of the country as a place for investment. We have Dr. Ngo- zi Okonjo-Iweala driving the economic management team. We cannot have it better. Nigeria has assembled world-class people, who have helped other economies to come fix our economy. There is no better time than now for people to look in this direction to make investments. In Africa, Nige- ria stands out, and foreign investors should take advantage of this. We need more UBAs, MTNs, and Dangotes. And so the message tonight is not just a message to foreign direct investors, it is also a message to Nigerian entrepreneurs. Nigeria is a huge market; let us take advantage of it. If you have more capacity, let us take advantage of the entire region. Nigeria is a destination where multinationals

61 Tony Elumelu, CON can, and do succeed, and where domestic champions are rising and adopting increasingly regional and global strategies. Nigeria is full of people who are entrepreneurial, innovative, and ready to leverage opportunities and adopt technology. The question to all of us here, both local and foreign investors, is this: When we tell the story in ten years’ time, whose story are we going to be sharing? We are not going to be celebrating people who said, “Yes, we saw opportunity in Nigeria, but we ran away.” We are going to be celebrating those who saw opportunity in Nigeria, realised that Nige- ria does have institutional challenges like other economies have, but decided, despite all of it, to venture into Nigeria. So the question again is: “Whose story are we going to be celebrating in ten years’ time?”

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A New Type of Philanthropy: Africapitalism

Speech delivered at the African Development Bank’s Annual Meeting, Morocco, themed, Philanthropy vs. Africapitalism 28 May 2013

63 Tony Elumelu, CON

We need a new type of philanthropy; one that can get the economic ecosystem working, resolving the underlying factors that contribute to the end goal of development.

– Tony Elumelu, CON

64 would like to thank the African Development Bank for inviting me to share my thoughts on Africa’s develop- Iment with you today. I was asked to speak on the question: “Philanthropy and development, where are Africa’s wealthy?” It is a very pertinent question because I believe Africa’s wealthy have a distinct role to play in Africa’s development. Indeed, many have been active, but perhaps not in the traditional way the development community has bench- marked interventions. To me, a far more important and appropriate question to ask is: “Where are we with respect to Africa’s development goals?” Africa’s development has become somewhat of a personal mission. It would be unimaginable to take on the development of an entire continent without a sense of mission. The task is too formidable. It demands of us a commitment more substantial and enduring than mere enthusiasm or passion. The development community often talks about this mission of African development with a theoretical ring – economic and socio-economic terms, technical jargon and statistics that distance the true meaning of development. But let us put those aside and get right to the heart of the matter. There are tens of millions of people across this continent, yearning for some of the things that we take for granted. They want jobs. They want to send their children to school. Perhaps, they want to own a home or a car. For

65 Tony Elumelu, CON some, owning a bicycle may feel like a taste of freedom and independence. They want to be able to afford healthcare, food, recreation, and the basic comforts of life. Africans, like people all over the world, yearn for self-determination, and the economic resources to make that possible. This is what I define as “development”. These are the questions that we should all be asking ourselves: where are we with respect to these goals? Are we moving urgently enough? How can we do more good for a million more people? Not just to better their lives, but set them on a path of self-sufficiency, so they can enjoy the kind of economic freedom and self-determination that we all enjoy. How can we do it as quickly as possible? How can we start a positive cycle of self-sustaining growth—and fulfil the promises that are implicit in our development mission? For decades, charity has been at the centre of Africa’s development agenda – playing a prominent, if not a dominant role. Charity will always have a role to play in some aspects of healthcare, education or disaster relief. Even in the West, we saw a critical need for charity relief when Hurri- cane Sandy hit the US But over the long-term, chronic health and welfare issues are better addressed by creating self-reliant individuals, families and communities. People and communities that have jobs and economic resources are better equipped to solve their own problems to their own satisfaction than charities that offer temporary relief. The philanthropic community, however, is only just beginning to take this lesson to heart. Most philanthropies still focus primarily on giving away “free money”. The world’s oldest, and most generous charitable institutions like the

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Ford Foundation, the Carnegie Foundation, the Gates Foundation, and many others, over many decades have his- torically focused on grant-making and charitable support for public services, because in the twentieth century worldview, addressing any problem merely required sufficient giving. But in fact, in his book, Random Reminiscences of Men and Events, John D. Rockefeller wrote that the goal of charity is essentially to beget more charity. He said: “It is easy to do harm in giving money. [Giving] to institutions, which should be supported by others, is not the best philanthropy.” It is a powerful statement indeed, from one of the world’s best known philanthropists. In this worldview, it was accepted as an immutable fact that recipients of charity would need to “make constant appeals”, meaning that they would forever remain in constant need. There is no talk here of outgrowing the need for appeals, or solving the underlying problems. Consider just one small example from recent history: back in 2010, after spending $700 million on polio vaccines

But over the long-term, chronic health and welfare issues are better addressed by creating self-reliant individuals, families and communities. People and communities that have jobs and economic resources are better equipped to solve their own problems to their own satisfaction than charities that offer temporary relief.

67 Tony Elumelu, CON and prevention programmes, the Gates Foundation found that polio was actually spreading in many parts of the developing world. An article in the Wall Street Journal pointed out that polio had “evaded a two-decade-long $8.2 billion effort to kill it off”. And the article asked whether humanity is better served by charities waging war on a single disease, or pursing broader goals like improved hygiene and clean water. Since then, the Gates Foundation has reported progress on its polio goals, but let us step back and ask: was this how polio was eradicated in the developed world, through charity? Or was it because the average working person could afford to go to the doctor? Perhaps it was because private physicians in the community were an efficient way to get vaccines to the public. Was it helped along by the fact that developed countries had functioning health insurance markets and profitable pharmaceutical industries to manufacture vaccines? The reason why social and welfare problems have been successfully addressed in developed nations is, in large part, because their economic ecosystems are working, whereas in Africa they are not – at least not quite yet. And so, today, we come to a critical crossroads in the evolution of philanthropy. Achieving self-sufficiency for recipients must be the overriding criteria for philanthropic gifts, and success should be measured by how many recipients no longer need charity, rather than how much money is given away. Essentially, we need a new type of philanthropy, one that can get the economic ecosystem working, resolving the underlying factors that contribute to the end goal of development. We need a new philanthropy that understands the power of private sector solutions. I believe, the most productive use of charity in

68 Africa Speaks: A Collection of Speeches this new world will be to support the growth of the private sector, with a goal of eliminating – as much as possible – the need for “free money”. And this is where “Africa’s wealthy”; the ones who are at the fore of growth in the private sector are needed. For example, consider the case of United Bank for Africa, which was started with a $5 million investment, partially funded with “development capital”. UBA is now a multi-national, pan-African financial institution that has created twenty thousand jobs, generated wealth in communities all across Africa, expanded finance for trade, created stronger financial infrastructure for investment and economic growth, paid taxes to national and local governments to support public services, and given millions of customers control over their financial lives. The annual flow of charitable aid into Africa is many times the $5 million investment that started UBA; but has aid created an equivalent impact in jobs, wealth, and sustainable growth? Is that an uncomfortable comparison? Take water as another example: charity can pay for a new well, but if no one has a personal interest in it, or takes responsibility for maintaining it, soon, it will fall into disrepair and disuse. On the other hand, structuring that same donation as a for-profit micro-utility creates incentives and resources to maintain it; therefore, improving its sustainability and long- term impact. In fact, “free money” often crowds out vital private sector solutions. Private enterprise cannot compete with highly subsidised capital, and the net result is that charity often provides a short-term fix at the expense of a long-term solutions. This may be an unsettling idea to those of us who

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In fact, “free money” often crowds out vital private sector solutions. Private enterprise cannot compete with highly subsidized capital, and the net result is that charity often provides a short-term fix at the expense of a long-term solution. This may be an unsettling idea to those of us who believe strongly in philanthropy, but it is a fact nonetheless.

believe strongly in philanthropy, but it is a fact nonetheless. We must not only face such facts, but also find practical ways of using them to our advantage. Philanthropy and development aid can, and should, be components of Africa’s growth strategy. But I believe it is time for a philosophical change in how that capital is deployed. If our mission is self-sustaining Africa’s development, then philanthropy and charity need a new way forward. We must admit that many past practices have been unproduc- tive, if not outright counter-productive. In many cases, it is easy to do harm in giving money, particularly when charity is not aimed at eliminating the core problem. We clearly see that it is not the best philanthropy to ignore long-term dependency – being in a constant state of need, or making constant appeals. Rather we should seek to eliminate the core problem altogether. I find it inspiring that many foundations are now leading the charge in innovative new areas such as impact investing.

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They are partnering with private capital to focus on sustainable profit-making businesses that generate jobs, economic growth, and social wealth. Many have embraced the idea of “complementary philanthropy” that helps attract global capital and bring impact investing up to scale – a scale that can bring meaningful progress on pressing social challenges. This is the kind of modern “new philanthropy” that gets results. It is an approach that we practice at The Tony Elumelu Foundation in initiatives like our Impact Economy Innovations Fund, launched in conjunction with the Rock- efeller Foundation. This principle also guides much of our work at the investment company, Heirs Holdings. Which brings us back to the topic of investors. Where do we fit with respect to this “new philanthropy”? If the free money approach to charity is not working, and the private sector approach offers more sustainable solutions, then what is our role as investors and business people? I believe that, just as Africa needs a “new philanthropy,”. So it needs a new approach to investment. I have called this new approach Af- ricapitalism. It asserts that the private sector is best suited to solving Africa’s most pressing problems, through investment, employment, wealth creation, and economic growth. But if the private sector is to accomplish this goal, we must fundamentally re-think our priorities and objectives. We must do away with short-term thinking. We should be investing over time horizons measured in decades, rather than fiscal quarters. We must stop the practice of extracting wealth without reinvesting for growth. We should be strategically building domestic industries and manufacturing to support healthy vibrant national economies, and growing intra-African trade. African investors, in particular, must

71 Tony Elumelu, CON step up. We need to deliberately plough resources back into our own communities to create industries and jobs, to create self-sufficient consumers and businesses, for these will be our future customers, managers, staff, and partners. I ask, who will invest here if we are sending all our money to Swiss banks? Who will take investment risks here if we say with our actions that the risk is not worth it? Heirs Holdings’ recent $300 million investment in a power plant in Nigeria to generate 1200MW of electricity is an example of a long-term investment that can bring development to Africa. Through this investment, we intend to create value for our partners and ensure everyone feels the benefits of having access to electricity. Heirs Holdings is investing in a long-term power project in Nigeria because we believe it is worth it. Knowing that children are able to do their homework at night is worth it, that schools are able to run computers, families are able to store food, doctors are able to keep active vaccines in a refrigerator, that entrepreneurs can run their businesses with lower overheads, produce more at lower prices, can innovate, employ, grow – these are all worth it. These are just some of the ways the private sector can help to develop Af- rica. I know investing in Africa is worth it because I have seen it with my own eyes. I have experienced it for myself in the countless people I have met, and dozens of business ventures I have pursued. And I am not alone. People like Aliko Dangote and Mike Adenuga in Nigeria; Lucien Ebata in the DRC; Reginald Mengi in Tanzania; Gordon Wavamuno in Uganda; Patrice Motsepe in South Africa; and Kofi Amo- abeng in Ghana are reinvesting in domestic industries that

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African investors, in particular, must step up. We need to deliberately plough resources back into our own communities to create industries and jobs, to create self-sufficient consumers and businesses, for these will be our future customers, managers, staff, and partners.

support the basic needs of African people. They are creating tens of thousands of jobs, impacting individuals, families and entire communities. So when I asked before, “Where are Africa’s wealthy?” That’s where they are. They are in Tanzania, Uganda, South Africa, and Ghana. They are creating jobs, impacting individuals, families and entire communities. Economic prosperity is the most valuable and lasting gift we can give to Africa – that should be the ultimate goal of any development mission. With your continuing support, I believe we are in a much stronger position now, and much closer to achieving our goals, than at any time in the past. So with gratitude, I say that it is both an honour and a privilege to be able to engage you today on this very important subject. Thank you.

Africa Speaks: A Collection of Speeches

The Private Sector Can Help Change the World

Closing Plenary Session. Speech delivered at Oxford University, London, Skoll World Forum themed, Advice to Young Entrepreneurs, Africapitalism, and the UBA success story

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A journey without purpose is a waste of time.

– Tony Elumelu, CON

76 ood afternoon. It is good to be here with you all, and to see the faces of people who are going to Gchange the world. I would like to start by congrat- ulating my friend, Jeff and Sally, for doing such an amazing job. They are wise people. They recognise the power of the people in this room – the people to whom the future of the world belongs and people who play a key role, as Jeff and I believe, in shaping the world and helping to meet most of mankind’s needs. I was invited to share some thoughts, and I reflected when I got the invitation on what I could say to people who have already have become entrepreneurs, and people aspiring to become more successful. I felt that the best way is to share a little of my own experience. They say experience is the best teacher. So I would like to share a brief experience on how we started a journey, as I believe some of you have started or are in the process of starting. This was when I was thirty-four, and I am told the average age of people in this hall is twenty-five, so you started much earlier than I did. I was originally a banker. I worked as a banker at a time the industry was expanding. At the time, we had, in my country Nigeria, over a hundred banks, and I felt that there would come a time when some of these banks would struggle to survive, and there was a need to position ourselves to take advantage of the opportunities that would unfold. This came to pass.

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When it happened we were ready. We took advantage by investing and turning around at least one of the banks. We grew that bank from a near distressed, floundering bank to become one of the top five banks in the country in a period of ten years. Subsequently, we merged this bank with the third largest bank in the country, and created the biggest bank in Nigeria with branches of about four hundred and twenty. We grew that bank into a pan-African bank that today has presence in nineteen African countries excluding UK, Paris and New York. We did this because of some at- tributes or factors I would like to share with you. First is the power of foresight. You need to be able to see beyond today, because in trying to do so, you create unique business opportunities and advantage. You need to understand your environment and see what could be the future of the environment. If you get it right, you would create huge opportunities. The second thing is purpose. A journey without purpose is a waste of time. So you have to have a sense of purpose beyond the foresight you have gained into unique opportunities to say this is what we would do. In my case, we

First is the power of foresight. You need to be able to see beyond today, because in trying to do so, you create unique business opportunities and advantage. You need to understand your environment and see what could be the future of the environment.

78 Africa Speaks: A Collection of Speeches saw that there would be an opportunity in the banking industry at the time, and we said there may be crises and the industry will need a solution, so let us groom and prepare ourselves to be the solution for the industry. So purpose is very important. The third thing is hard work. You cannot have foresight or purpose if you are not able to match that with hard work. We work very hard, and again as entrepreneurs I need not tell you this, but sometimes there is no difference between your job and your personal life at this stage. It is almost always like that. Beyond foresight, purpose and hard work, the next thing is to think long-term. We thought long-term. We were thinking of what would happen in ten, twenty years. When we started we did not define success in the short-term. We defined success in the long-term. To us success was about helping to democratise banking and helping to create financial access in a continent that did not have huge or impressive financial access. So, my long- term thinking continues to guide what I do till date, and I believe for most success entrepreneurs, short term thinking does not help so much. But as you think long-term it is good to have quick wins or milestones, because the milestones help you focus. They help you to understand whether or not you are on track. The next one is impact. Beyond long-term thinking, you need to ask yourself: what impact do I want to create here? For us, the impact was first: we wanted to democratise banking, because having a bank account was like a status symbol, and we needed to make it in a country of about 120 million people. People who owned bank accounts were less

79 Tony Elumelu, CON than five million. We saw an opportunity here, but we also saw it as a good cause to help democratise banking, and it is on record that in some countries when we decided to expand, we opened bank accounts with zero account balances, because we wanted to create access. We wanted people to have access to bank accounts. We wanted to change lifestyles to a large extent. The second impact or related, is that in Nigeria at the time, if your child, Paul, was schooling in a particular state you would have to physically go there to give Paul money or he would have to come to you. We needed to improve the payment system; we needed to create ubiquity; we wanted people to have access to payments without leaving their offices. So, we deployed technology to achieve this. The impact we wanted to achieve was important to us, and we realised that if we achieved it, we would make more money or we would have touched society in very significant ways. Today, this bank has, as I said before, operations in nineteen African countries and customers in excess of eight million. Nigeria alone has bank customers of less than five million. But it did not end there. My previous life as a banker has significantly influenced what I do today. I believe in a concept I shared with Jeff not too long ago – Africapitalism, which is a call to the private sector in Africa to invest long- term, and play key roles in developing the continent. For a long time, we have called out government for the lack of development on the continent, but we the private sector have a key role to play. Africapitalism is a call to the private sector to invest through long-term investments in key sectors that can help to create both economic prosperity and social wealth. This

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You cannot have foresight or purpose if you are not able to match that with hard work. We work very hard, and again as entrepreneurs I need not tell you this, but sometimes there is no difference between your job and your personal life at this stage. It is almost always like that.

is what I preach, and that is one of the reasons I am here. I believe that the future of this world, to a large extent, is in the hands of the private sector, which is driven largely by entrepreneurs – people like you in this room. Two days ago, I was at the United Nations to talk further about the role of the private sector in the post 2015 MDGs. I shared with the audience what I think the private sector should be doing and how the private sector should engage with the public sector and the NGOs, to create a better society. It is true that people say that the private sector is driven by other motives, but indeed we see the ideological convergence between what is good for private sector and what is good for mankind. For yourselves as entrepreneurs, this belief in the ability of the private sector to help change the world is one you should own; one you should work towards; one you should demonstrate. You can do well and do good simultaneously. I believe in this, and I have dedicated the second phase of my life to making sure that my colleagues and I continue to work to create more Tony Elumelus – more entrepreneurs out of Africa – and that we give all the support, they need

81 Tony Elumelu, CON to succeed, and that they can compete with other entrepreneurs from other parts of the world. We would like to see this kind of event hold in Africa with young entrepreneurs from all over trying to conquer the world, and to connect. Soon we shall be launching an initiative, in the space of entrepreneurship, to enable aspiring African entrepreneurs realise and fulfil their passion for success in this field. I would like to end here and wish you all greater successes and self-inspiration, realising that what we do in our respective endeavours can help make the world a better place. Thank you very much.

82 Africa Speaks: A Collection of Speeches

Powering Africa’s Future: Examining the Power Africa Initiative

Testimony before the US Senate Foreign Relations Committee’s Subcommittee on Africa, Washington, D.C. themed, Advocacy for Power in Africa

83 Tony Elumelu, CON

The creation of jobs in Africa is completely dependent on industry, and industry cannot thrive without consistent power supply.

– Tony Elumelu, CON

84 r Chairman, I want to thank you, Senator Coons, and Senator Flake for extending this invitation Mto me to attend and provide testimony to the Subcommittee of the Senate Foreign Relations Committee on this important topic, “Powering Africa’s Future: Examin- ing the Power Africa Initiative”. I am the Chairman of Heirs Holdings and Founder of the Tony Elumelu Foundation. Heirs Holdings is a pan-Af- rican investment company, which operates in strategic sectors including, banking, power, oil and gas, agribusiness, real estate and hospitality. We take a long-term investment approach to unlock value for our stakeholders and to create a catalytic effect in propelling Africa’s economic development. I coined the term “Africapitalism” to describe our approach to business – our belief that long-term investment in key sectors like power, can create economic prosperity and social wealth, benefitting investors and Africa’s future development. At its core, Africapitalism as an economic philosophy encourages practices that create and multiply value locally. Energy-poverty is very personal to me. I am an entrepreneur – born, raised and educated in Africa. And through the Tony Elumelu Foundation, we are working to help launch and support a thousand more successful entrepreneurs. Through our philanthropic efforts, I have repeatedly seen how the lack of access to reliable power has constrained

85 Tony Elumelu, CON human potential and stifled economic growth across the continent. Currently, 589 million Africans have no access to electricity, and many more lack reliable access. We are a continent of entrepreneurs some of the smartest in the world. But how many budding entrepreneurs can really succeed and create more jobs, if they do not have electricity to power their businesses, or afford the cost of electricity, which is more than 55 per cent of the operating costs of their business? The lack of electricity in sub-Saha- ran Africa has significant implications on livelihoods. It significantly impacts food security. Technological advancements have supported food security in the West, while the lack of electricity in sub Saha- ran Africa has meant that the growing population continues to rely on rudimentary facilities for harvesting and storage, without the added value that could support food security and boost livelihoods. Lack of electricity impacts international security because extremism is fuelled by poverty. With only 54 million new jobs available for the 122 million Africans expected to join the work force by 2020, I am extremely concerned with what this means for international security. The creation of jobs in Africa is completely dependent on industry, and industry cannot thrive without a consistent power supply. The leadership of the United States is considering this issue at an important time, as African citizens are prioritising the issue of electricity access, and linking its success to the alleviation of poverty and promotion of lasting economic prosperity. Power Africa is an important initiative for the following reasons: first, influence matters. The US government’s elevation of this issue has galvanized the private sector in the

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US and other countries to examine the African power sector as an opportunity for viable investment. Second, using a coordinated approach, Power Africa set a collective and measurable target to generate an additional 10,000MW, within a set time frame, for US agencies, African governments, Afri- can private sector and investors, to work towards in Africa. Third, the establishment of Power Africa has also encouraged other African nations to undertake reforms of their regulatory structures, so as to participate in future power deals and partnerships. In my opinion, Power Africa must be viewed by the Administration and this distinguished body as only a start. The initiative is valued at $7 billion and Africa’s power infrastructure needs are estimated to be $300 billion. But like all long journeys, the journey to sufficient infrastructure begins with the first step or, in this case, the first $1 billion. At the request of the leadership of this committee, the African success story I would like to share with you today is that of the Ughelli power plant in the Niger Delta region of

We are a continent of entrepreneurs some of the smartest in the world. But how many budding entrepreneurs can really succeed and create more jobs, if they do not have electricity to power their businesses, or afford the cost of electricity, which is more than 55 per cent of the operating costs of their business?

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Nigeria. Through Transcorp, Heirs Holdings committed to invest up to $2.5 billion to generate 2,000MW of electricity over five years, 20 per cent of the U.S government’s goal of doubling access to electricity in Africa over the same period. The initial investment in the plant was $300 million. When we first took over the plant in November 2013, its power output was less than 160MW of power. By 1 January 2014, we had doubled its output to 348MW, and this morning it was 382MW. With our on-going investment of an additional $200 million to refurbish some of its turbines, we project that Ughelli will be generating 725MW by the end of this year. We are also partnering with Symbion Power and Gen- eral Electric (GE) on a 1000 MGW expansion costing $1 billion USD. I am pleased to inform you that we are on track to fulfil our commitment to Power Africa and we will be producing the equivalent of almost 50 per cent of the current total output of 4,200MW in Nigeria. And in 2015, we will begin plans to generate power in other West and East African countries. Transcorp Ughelli also currently directly provides employment for nearly three hundred full-time workers and one thousand contractors, and this will grow to seven hundred employees and two thousand contractors with the planned expansion. We have not even calculated the thousands of tangential and important jobs that will be created by plant operations and power output. With respect to climate change, environmental sustainability, and concerns about the development of natural gas for power, Heirs Holdings believes strongly in protecting the environment for future generations, but we also recognise the importance of addressing the urgent needs of this

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Power Africa must be viewed by the Administration and this distinguished body as only a start. The initiative is valued at $7 billion and Africa’s power infrastructure needs are estimated to be $300 billion. But like all long journeys, the journey to sufficient infrastructure begins with the first step or, in this case, the first $1 billion.

generation, through a mix of renewable and non-renewable resources, in accordance with African countries plans, some of who prioritise their abundantly available natural gas resources. To further put this in context, the annual average carbon emission in sub-Saharan African countries is .3 tons per person. In Europe the average is 10 tons per person, and in the United States, average annual emissions are as high as 17 tons per person. Africans now want to harness these same resources to meet our own urgent development needs. Sub-Saharan African countries account for less than 3 per cent of global carbon emissions; our poorest bear the brunt of the climate change problem, and only Africans cannot solve it. In conclusion, I would like to offer a few recommendations to this esteemed body as you continue to deliberate over Power Africa and US/Africa policy matters. Make haste to introduce and pass the Electrify Africa Act before the end of this Congress, to codify the expansion of access to

89 Tony Elumelu, CON electricity in Africa as a US government international development and foreign policy priority. Like the Africa Growth and Opportunities Act (AGOA), Power Africa, augmented by Electrify Africa Act, could help lay the foundation for a new US/Africa relationship – one based on partnership for mutual economic benefit. Encourage policy reforms by African governments and institutions. There is no amount of capital investment or entrepreneurial zeal that will provide affordable and sustainable access to electricity for Africa’s 1.5 billion people without the full buy-in and energetic support of African governments. Make engagement with the African private sector a Congressional priority in oversight and new policymaking. Public-private partnerships are critical to developing the Af- rican continent, particularly in the power sector. It is important to recognise the revolution that has taken place in the African private sector and there is a lot of innovation, know-how and strong corporate governance values in the African private sector. Finally, we call our company Heirs Holdings because we are committed to enhancing the lives of Africans today and driven to create transformative change for future generations. We believe in Africa, we believe in our ability to help catalyse its emergence as a strong player in the global economy and we are confident that history would remember who played a role in making this happen. Thank you again for your kind invitation to participate in this important hearing, and I look forward to answering your questions.

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the message

“Our mission is guided by our philosophy―Africapitalism―a private sector commitment to the economic transformation of Africa through long-term investments that create both economic prosperity and social wealth.”

– Tony Elumelu, CON

Africa Speaks: A Collection of Speeches

Partnership in the Post-2015 Development Agenda

Speech delivered at United Nations Economic and Social Council (ECOSOC) and the General Assembly of the United Nations, themed, Power, Africapitalism and the Private Sector and SDG Goals

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The creation of the UN Global Compact to elevate human and labour rights, and establish anti-corruption and environmental sustainability in corporate practices, is an important milestone in the area of corporate accountability.

– Tony Elumelu, CON

94 ecretary-General Ban Ki Moon, Ambassador Ashe, President of the UN General Assembly; SHon. Sajdik, President of ECOSOC; ambassadors, representatives, delegates and observers of the various nations and peoples of the world; representatives of civil society organisations and the private sector; and distinguished ladies and gentlemen. I thank you for the opportunity to address this distinguished body that is symbol of our common humanity. Coming from Africa, the continent most in need of development, I am particularly grateful to be able to speak on the collective targets that will have a life-changing impact for hundreds of millions of my people. As an entrepreneur – one born, raised, educated, and worked all his life in Africa – now engaged substantially in nurturing more entrepreneurs in Africa, I would like to make a case for the prioritisation of three important issues that affect our continent, in the implementation of the post-2015 development agenda. These issues are the tackling of unemployment and stimulating job creation; increasing access to electricity; and engaging the private sector as key stakeholders in achieving the 2030 development goals. In 2000, the United Nations made the historic announcement of eight Millennium Development Goals (MDGs). They were very specific, and a time frame of fifteen years was set to deliver on the goals. Most importantly, they

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With nearly two hundred million people aged 15–24, Africa has the youngest and most rapidly growing population in the world. By 2045, our youth population will double, and exceed that of China and India.

were universal goals, though some of the issues the UN sought to address were unique to certain regions of the world. The ultimate value of the MDGs was that they mandated a global response to the most pressing humanitarian issues affecting a significant number of the world’s population. The MDGs became an acknowledgement that we are our neighbours’ keepers. Since then, we have made significant progress on these issues, as you all know well. But there are still important lessons to learn from the formulation and implementation of the MDGs. First, the formulation process was not very inclusive, that is, the goals were mainly focused on the most basic needs of the individual, and less on macro-economic development. Also, they were implicitly designed to be government and donor driven, and lacked an explicit commitment to engage private-sector actors as financiers, stakeholders and implementers of the MDGs, to drive sustainability. This is not to say that the private sector was totally absent from the implementation of the MDGs. There are several examples of successful public-private sector collaboration relating to the MDGs. These partnerships were the most effective when it involved businesses contributing through

96 Africa Speaks: A Collection of Speeches their own operations, rather than afterwards through CSR programmes funded by profits already earned. I am talking about examples like the creation of the Global Alliance for Vaccines and Immunization (GAVI), which issues “Vaccine Bonds” to investors all over the world, to fund immunisation in developing countries. I am talking about companies like Vodafone working with GAVI in Africa to record births and vaccinations, reminding parents to bring their children for immunisation, and managing vaccine stocks. I am talking about examples like the Glob- al Fund leveraging Coca-Cola’s expansive global beverage distribution system and core business expertise to build a more efficient supply chain to take drugs to the “Last Mile,” thereby increasing the availability of critical medicines to 75 per cent for Tanzanians and benefitting nearly twenty million people. I am also talking about the Extractives Industry Transparency Initiative, where governments and the private sector in resource-rich countries commit to transparency of payments to facilitate accountability in the natural resources sector. There are countless other such partnerships out there. Now when it comes to the post-2015 development agenda, I am pleased to observe that the process has been much more inclusive. A High-Level Panel on the Post 2015 Develop- ment Agenda was appointed from both donor and recipient countries, and transparent and wide-ranging consultations have been held across the globe, at government, civil-society, private sector and grassroots levels. Importantly, the High-Level Panel’s report on the importance of “Trans- forming Economies, and an Agenda for Jobs and Inclusive Growth” demonstrates an understanding that both life and

97 Tony Elumelu, CON livelihoods should be addressed as we set sail for 2030. And it is this reprioritisation that excites me the most. No one here questions whether development is desirable. No one will challenge the essential human need to save as many lives as we can. But what we can question is whether we can achieve the development imperative with a disproportionate focus on humanitarian assistance and micro-economic issues. We should also question how much of our post-2015 development agenda we could achieve if we maintain a heavy focus on governments as agents of development interventions and do not increase the level of engagement with the private sector in achieving our goals. I was delighted that the High-Level Panel raised the issue of jobs and inclusive growth as priorities for the next MDGS, because the countries with the largest percentage of poor, the sick, and the oppressed are also the countries with the smallest economies and smallest percentage of formal employed people. We cannot continue to close our eyes to the looming crisis of unemployment in the African continent. With nearly two hundred million people aged 15–24, Africa has the youngest and most rapidly growing population in the world. By 2045, our youth population will double, and exceed that of China and India. We must create thirteen million jobs each year in sub-Saharan Africa just to keep pace with population growth. By 2020, Africa will need one hundred and twelve million jobs if we are to succeed in the fight against poverty and maintain political stability and global security. As an entrepreneur with diverse experiences in Africa, I see humanitarian aid and economic opportunity as two sides

98 Africa Speaks: A Collection of Speeches of the same development coin. The current development practice is to invest in the basic health and education of people, in the hopes that they will eventually make something of themselves. However, I also think that if we help people make something of themselves by investing in jobs and economic opportunity, with the multiplier effect of access to energy, the beneficiaries will purchase healthcare, purchase education for their children and look after their families. They will live longer, healthier and in dignity. So we must not focus on one side of the coin at the expense of the other. Citizens with the opportunity to be productive wage earners for their societies also become taxpayers, and contribute to government coffers. Lack of access to energy or electricity is another challenge that will prevent us from eradicating poverty. Nearly five hundred and eighty-nine million, or seven out of ten Africans, have no access to electricity. Only 2 per cent of South Sudanese and Burundians, and 3 percent of Liberi- ans, have access to electricity. Millions of mothers are giving birth in the dark, at great risk to themselves and their babies; millions more are walking further and further every day to gather dwindling resources of firewood; lifesaving vaccine

If we agree that access to electricity and improved livelihoods are vital components for the success of the post-2015 development agenda, then the private sector will have a key role to play in the implementation of the post-2015 development agenda.

99 Tony Elumelu, CON deliveries are challenged by lack of power to support their cold chains; nearly two million deaths per year are associated from illnesses derived from cooking with wood and charcoal. In African Business Enterprise surveys, fifty percent of businesses cited lack of electricity as the major constraint to their growth. Education is another catalytic sector to achieve development gains, yet ninety million children go to school without electricity. This translates to at least ninety million lost hours of study and homework every day. Over time this lack of electricity and lack of education will create a cumulatively devastating problem for a continent with a large young population without the necessary education and skills to power the continent’s industries. It will also affect the continent’s emergence as a full player in an integrated global economy. If we agree that access to electricity and improved livelihoods are vital components for the success of the post-2015 development agenda, then the private sector will have a key role to play in the implementation of the post-2015 development agenda. A global agenda that intends to address the livelihood of people and eradicate extreme poverty is not set up for success if it does not engage the sector that controls the most capital, employs the most people, and fosters the most innovation. Distinguished ladies and gentlemen, understandably, there are concerns about the involvement of the private sector in the post-2015 Development Agenda. Indeed, some appear legitimate. The first concern is that private sector financing will displace government Overseas Development Assistance (ODA). Let me say that private sector financing is not intended and cannot displace ODA. Government in-

100 Africa Speaks: A Collection of Speeches vestment in development helps to stimulate and incentivise private sector financing, and we have seen this work successfully in multilateral investments in the fights against the global AIDS pandemic and the Power Africa Initiative, which have attracted the private sector to invest billions in those areas. But we must also recognise that both donor and recipient governments have limited capacity to invest further, and in the current global economic climate, many are making cuts to their aid and public spending. Thus, in our public capital constrained environment, serious consideration must be given to leverage private capital to meet development needs outside of the most urgent humanitarian situations. Another concern is that private sector values and interests are different and cannot be aligned with values that drive the development sector. Sadly, not all private sector actors have operated ethically, and it is unreasonable to assume that the market can solve all problems. The world wit- nessed with bitterness, the upending of the US housing and banking bubbles, which set off a devastating seismic chain of devastating national economic meltdowns, in multiple countries. And that is why the creation of the UN Global Compact to elevate human and labour rights, and establish anti-corruption and environmental sustainability in corporate practices, is an important milestone in the area of corporate accountability. However, it would also be wrong to assume that all businesses are driven by the principle of pure profit, devoid of values. I am the Chairman of Heirs Holdings, an African investment company, which operates in strategic sectors of industry all over Africa, including banking, power, oil & gas,

101 Tony Elumelu, CON

A successful UN post-2015 commitment to create jobs and increase access to electricity will require governments, donors and multilaterals to invest in human capital, through formal education and vocational skills training to drive employability.

agribusiness, real estate and hospitality and healthcare. We are driven entirely by the values and philosophy of Africap- italism, a term I coined to define the new role of the private sector in the development of Africa, through long-term investments that create economic prosperity and social wealth. Heirs Holdings may be best known for our $2.5 billion, 2,000MW commitment to Power Africa – a commitment we have started delivering through our Transcorp Ughelli power plant. We made the investment with the intent of returning a profit, while also creating significant social impact. Through this, we are helping to create thousands of direct and indirect jobs in the economy. We also know that it means more electricity for homes, hospitals, and more homework at night. It also means a huge boost for small businesses and entrepreneurs, which further leads to increased economic growth and job creation. Ours is one of many examples of companies around the world seeking a more inclusive approach to growth. A successful UN post–2015 commitment to create jobs and increase access to electricity will require governments,

102 Africa Speaks: A Collection of Speeches donors and multilaterals to invest in human capital, through formal education and vocational skills training to drive employability. It will require enacting reforms and new policies to create more competitive business environments. This will not only unleash the growth of small and medium-size enterprises, it will also attract and incentivise multi-billion dollar investors, to fill the infrastructure gap in under-developed regions. However, we in the private sector have important reforms to make as well. We must evolve our business theo- ries of success and Corporate Social Responsibility (CSR). No longer can CSR be considered just small corporate do- nations to good causes in their communities of operations. Launch CSR 2.0 and apply the principles of Africapitalism, which means that the intent to “create and multiply value” in the societies in which we source, supply and operate, must be built into our corporate governance, our operations, our project development and our profits, across the value chain. We must no longer wait for governments or the courts to compel us to do the right thing. We can do the right thing, while simultaneously doing well for our shareholders. Finally, in the pursuit of a sustainable post-2015 development agenda, we must harness the best of political will and resources, incentivise and convene power of the govern- mental sector, combining it with the compassion, selfless- ness and dedication of the non-profit sector, the innovation, expertise and, financial capital of the private sector; and the drive, creativity and entrepreneurial spirit of the very people we seek to help. This is how we will transform the world we live in and truly make poverty history.

103

Africa Speaks: A Collection of Speeches

Strengthening Entrepreneurship and Impact Investing through Philanthropy for Sustainable Development

Keynote Speech delivered at Liberia Foundation, themed, Changing the Narrative from Philanthropy to Africapitalism, Liberia

105 Tony Elumelu, CON

There is a space where philanthropy meets business, where the good intentions of philanthropy can work in partnership with business to create economic prosperity and social wealth. This space is called Africapitalism.

– Tony Elumelu, CON

106 t is an honour to be here today, in the company of Pres- ident Sirleaf Johnson, Pam Omidyar, the Humanity IUnited Foundation, and all of you from the Liberian Philanthropy Secretariat. I thank you for the invitation to deliver this address. I was asked to talk about why philanthropists should support entrepreneurship and impact investing as an approach to sustainable economic development in Liberia. A fitting title because, philanthropy and entrepreneurship are subjects close to my heart, and entrepreneurship, particularly, is central to the work that the Tony Elumelu foundation does. Today, I would like to share with you my thoughts on both, and the role I believe they can play in Liberia’s economic development. Traditional philanthropy or charity and aid have failed in Africa, and if Liberia continues to rely on them, it will fail Liberia too. Today, I would like to talk about the type of philanthropy that can contribute to Liberia’s development in a sustainable way, a type of philanthropy that makes solutions that work in the long-term and ultimately empowers the people it set out to help. I call this “strategic philanthropy”, and I believe firmly that this is exactly the philanthropy that Africa needs. Let me define it first of all by contrasting it to traditional philanthropy. Traditional philanthropy either by a wealthy individual or an institution contributes money in order to

107 Tony Elumelu, CON fix a problem. The emphasis is on identifying a problem that needs fixing, and providing the funding. Often the funding is towards a solution, but there isn’t necessarily a lasting or sustained impact. Because it typically defines philanthropy in terms of funding, it can ignore the many other ways in which individuals and institutions can contribute – by giving time, lending talent, insight and passion, all of which can and should be brought to bear on the problem. Strategic philanthropy redefines the goal and it broadens the definition of philanthropic activity. Strategic philanthropy is not about “fixing”; rather, it is about “building”. It is about creating sustainable solutions for the long-term that empower communities. It means contributing not just money but also one’s expertise, contacts and experience. By definition, it is designed to have an impact on development. I arrived at this approach through my own experience, and today it is central to the work we do at the Tony Elumelu Foundation. Let me describe that experience and that work as a way of making strategic philanthropy more tangible. Some of you have heard me talk in the past about my experience with United Bank for Africa. Starting with a defunct bank and a $5 million investment, we created a pan-Afri- can financial institution that employs twenty-five thousand workers, serving over seven million customers with a presence in nineteen African countries, as well as London, Paris and New York. I realised later that we were doing much more than building a business and making profit. We were creating jobs, facilitating local and cross border trade, providing access to financial services and empowering individuals and institutions. Isn’t that the ultimate aim of philanthropy? So

108 Africa Speaks: A Collection of Speeches when we set up the Tony Elumelu Foundation in 2010, I knew the impact a successful business could have in terms of driving development. I wanted to create that multiple times. In fact, our mission was to create one thousand more UBAs. In order to do that, we needed to tackle the barriers that hinder productivity and growth in Africa’s private sector. So we had to think about multiple approaches because of the complexity and challenges that entrepreneurs and businesses face in Africa. Let me quickly paint a picture for you about entrepreneurship in Africa. Most entrepreneurs and business owners do not have access to capital, their cost of production is often very high due to infrastructure challenges like power, which impacts on their growth, and there are government policies and mandates that are not supportive of their growth. So, we looked holistically at the entrepreneur and the environment and we developed interventions we believed would tackle the key problems. We run programmes in three areas: business leadership and mentoring, access to finance and policy. Under business leadership and mentoring, we offer a programme called the African Markets Internship Programme, which provides MBA and MPA students with a passion for Africa the opportunity to intern with high-growth African businesses and the private sector, dealing with government agencies. This creates capacity and “smart talent” for the businesses and enables the students to grow their skills and networks. In the three years since we started we have supported over one hundred and fifty companies and brought in over eighty students, many of who confirmed they would return to Africa after their studies.

109 Tony Elumelu, CON

Strategic philanthropy redefines the goal and it broadens the definition of philanthropic activity. Strategic philanthropy is not about “fixing”; rather, it is about “building”. It is about creating sustainable solutions for the long- term that empower communities.

About access to finance, one way we provide access is by investing in businesses that are financially sound, but more importantly will have a social impact whilst addressing a challenge. One of these is Mtanga Farms in Tanzania, that is developing a new variety of seed potato that will increase the yield for local farmers. This project has the potential to touch at least a one hundred thousand farmers in Tanzania. We have a number of other grants and funds for entrepreneurs including the Impact Economy Innovations Fund where we partnered with the Rockefeller Foundation to provide grants, not to entrepreneurs themselves, but to people who can set up any kind of support system or service that helps entrepreneurs flourish and become attractive to the impact investing industry. In the case of policy, understanding that we need to create an environment for entrepreneurs to be able to grow their businesses, we established the National Competitive- ness Council of Nigeria working with the Ministry of Trade and Investment. The council’s mission is to work with policymakers to improve Nigeria’s competitiveness. Our challenge is to increase Nigeria’s position by seventy-five plac-

110 Africa Speaks: A Collection of Speeches es on the two indexes. We currently rank 115th out of 144 countries on the GCI and 131 out of 183 countries on the ease of doing business index. We also support government to help them create better more supportive policy by capacitating them. Under the Elumelu Fellows Programme we have placed a very talented MBA, Economist, ex-banker, Ada Osakwe, in the Ministry of Agriculture. Her role is to help unlock the capital available to develop the agriculture sector in Nigeria. Essentially, she is the interface for domestic and foreign investors with interest in the Nigerian agricultural sector. Less than a year into the role, her impact is being felt. Cargill, the world’s biggest agricultural trader was able to invest in a cassava processing plants in Kogi State and Aliko Dangote in a $2 billion fertiliser production plant. These are just some of the many programmes the foundation runs, and every day we are thinking up new ones, we are looking for better, faster ways to help make an impact. I have shared with you some of the detail of how the foundation works, but what should the key take away be for you. First, all of these projects are strategic. They are long- term and intended to build lasting structures. Second, their outcome cannot be measured by the financial amount do- nated because the effort, time, network and strategic input of the team that created them are far more valuable than the amount spent to implement. Thirdly, these projects are the direct result of my expertise and passion because that is where I can add value. This is an important factor for strategic philanthropists to consider when deciding how and where they choose to contribute. There are simply not enough strategic philanthropists

111 Tony Elumelu, CON in Africa (and outside) to begin to create the sort of systemic change and impact we urgently need. There are targeted initiatives happening to try and get philanthropists to coordi- nate better, work more with government and help deliver on specific transformation agendas. I met some of these team at one such event hosted by Forbes earlier this year. In time, we will begin to feel the impact of these efforts. Till then, we will need to find new ways to create the impact we need. Today, I would like to share one of those “new ways”. Taking the best intent of philanthropy and combining it with the unique catalytic power of the private sector to empower people and nations on a bigger scale, I believe we will come to a new solution for Africa’s development. There is a space where philanthropy meets business, where the good intentions of philanthropy can work in partnership with business to create economic prosperity and social wealth. This space is called Africapitalism. Let me explain. Africapitalism is an economic philosophy that the Afri- can private sector has the power to transform the continent through long-term investments, creating both economic prosperity and social wealth. The economic philosophy is about creating value within Africa in the long-term. It is about transforming the continent in a way that is both profitable and sustainable. It is also a call-to-action for Africans to take primary responsibility for our own development and for non-Africans to evolve their thinking about how best to channel their efforts and investments in the region. By creating new economic wealth, Africapitalism can address almost every challenge facing Africa today, from healthcare, education, food security, and even national security and social stability. The more opportunity the private

112 Africa Speaks: A Collection of Speeches sector can provide, the more Africa will benefit from a stable and productive economic environment, as well as achieve self-reliance in solving persistent socio-economic issues. My experience with UBA was more than just an awakening to the potential of how business can play a role in development. The growth of UBA into the pan-African multinational is also a powerful example of Africapitalism. Today we are repeating what we did in the financial services sector to the power sector. Recently, we committed $2.5 billion to the US government’s Power Africa initiative in which Libe- ria is involved. We are investing in power not just because we will make money, but also because we believe it is worth it. Knowing that children are able to do their homework at night is worth it, that schools are able to run computers, families are able to store food, doctors are able to keep active vaccines in a refrigerator, that entrepreneurs can run their businesses with lower overheads, produce more at lower prices, can innovate, employ, grow – these are all worth it. On a continent where agriculture is so critical in ensuring our food security, along with the foundation, partners in Berggruen Holdings and 50 Ventures, we have invested in the African Exchange Holdings. It is a start-up venture whose objective is to develop a network of commodity ex-

Cargill, the world’s biggest agricultural trader was able to invest in a cassava processing plants in Kogi State and Aliko Dangote in a $2 billion fertiliser production plant.

113 Tony Elumelu, CON changes across Africa to transform trade dynamics in the agricultural sector and ensure higher incomes for farmers across Africa. The idea behind the exchange is simple: to empower African farmers. The exchange will provide them with access to storage and credit and will support crop ag- gregation at the farm level. Essentially, it allows farmers to be more effective players in the market allowing them to obtain better prices and effectively integrating them with the global market. Today your average smallholder farmer in Africa has no access to finance; he gets a poor deal from middlemen and has no idea of market prices. On top of that he typically loses 25 per cent of his harvest due to poor storage. But with a commodity exchange in place, he now stores his harvest at a warehouse and now loses less than 5 per cent of his harvest. Through the receipt system, he now has access to finance and can even hedge the family’s price risk through a future contract at the exchange. As a result, he is financially empowered, can reinvest in his farm – improve his farming methods making him and his community more independ- ent. Imagine this happening across Africa. Our first exchange was launched this year at the World Economic Forum in Davos with Rwandan President Kag- ame, who is hosting the first exchange in Rwanda and we are about to start operating a Warehouse Receipt System at the Abuja Securities Exchange in Nigeria. This is another example of Africapitalism. Through an investment we made in Teragro, a government owned juice concentrate factory in Benue State in Ni- geria, we are transforming the lives of the local farmers. The region currently produces approximately 800,000 metric

114 Africa Speaks: A Collection of Speeches tonnes of oranges. Fifty to sixty per cent of those oranges are left to rot, as the state has no processing capability. The Tera- gro factory processes only 26, 000 metric tonnes per year, so there is huge potential, but now farmers are being paid for their crop and through this investment, we have created jobs and Nigeria’s food security been improved. But these are just my examples. There are many more of us doing similar things across Africa. People like Aliko Dangote and Mike Adenuga in Nigeria, Lucien Ebata in the DRC, Reginald Mengi in Tanzania, and Patrice Motsepe in South Africa. These are African business leaders who are reinvesting in domestic industries that support the basic needs of African people. They are creating tens of thousands of jobs, impacting individuals, families and entire communities. For more Africapitalists to emerge, African leaders and governments have a critical role to play. It is government’s chief responsibility to create an enabling environment in which the private sector can engage in wealth-generating economic activity. Governments need to implement strong, long-term, stable policies, so that business leaders can invest for the long-term. The right incentives from government will make short-term thinking unattractive and push business activity toward long-term investment and value addition in key sectors. Even though there is compelling evidence to support it, Africapitalism is not the only solution for Africa or Liberia’s development. Philanthropy still has a role to play. There will always be a role for philanthropy. Philanthropy allows for an element of risk, which Africapitalism does not. Philan- thropy also does not require the same level of accountability,

115 Tony Elumelu, CON

You do not need to be wealthy; you do not need to have millions to give away. Anyone with a mission and a strong vision for Africa, as well as the ability to turn a challenge into a viable solution that contributes to our development, can be an Africapitalist.

which means it can play a very different role. For example, philanthropy can be used to provide “aid for business”, that is, grants and subsidies that reduce costs and risks for new business as we are doing with the CC Hub in Nigeria, an incubator and an innovation ecosystem as well as the impact investment fund, we developed with Rockefeller. It can provide free money to businesses to support their growth as well as co-invest with financial intuitions to provide guarantees and incentives. However, for some challenges, such as floods and other natural disasters, Africa still needs to rely on traditional philanthropy and relief aid because the private sector cannot solve 100 per cent of our challenges. But perhaps the most important factor in deter- mining, whether philanthropy or Africapitalism is more important for Africa, I would argue for Africapitalism. Africapitalism is more inclusive than philanthropy. You do not need to be wealthy; you do not need to have millions to give away. Anyone with a mission and a strong vision for Africa, as well as the ability to turn a challenge into a viable solution that contributes to our development, can be an Africapitalist. Given the number of challenges we have in

116 Africa Speaks: A Collection of Speeches

Africa, given where we need to get to, and when we need to get there, philanthropy will need to work hand in hand with Africapitalism, with government and with the development community to deliver on the economic potential of this continent. Africa needs more philanthropists. We need more of Af- rica’s high-net-worth individuals to give in an institutional manner. We need more international philanthropists to approach Africa strategically and work with local partners to ensure they are delivering sustainable long-term solutions that actually empower the community. And we need more Africapitalists, that is, more business leaders to conduct business and make investment choices that impact and empower. Most of all we need government, the development world to come together with the private sector and create more opportunities for Africapitalism to work. I was asked here today to talk about “why philanthropists should support entrepreneurship and impact investing as an approach to sustainable economic development in Li- beria”. In closing, I want to share with you my vision for the future of philanthropy. Today, we believe that philanthropy is separate from business. You are one thing or the other. For example, Bill Gates was an entrepreneur and business icon, then he became a philanthropist and dealt with health, vaccine and development issues. I would argue that Bill Gates was as much of a philanthropist back when he started Microsoft, as he is today with his fight to eradicate polio and malaria. The systemic change he caused in the way we worked, the innovation he spear- headed, the jobs he created across the world as the result of

117 Tony Elumelu, CON the years he spent building Microsoft has had as much impact on social wealth and economic prosperity than anything his foundation will do. My vision for Africa as an entrepreneur is the same as your vision that is looking to philanthropists to make an impact in Liberia. The making of a better Africa should not be the preserve of wealthy philanthropists and the international development world that seek to do good. It should be in the DNA of all Africans. The development challenge exists, and the potential reward is so great, that we should have no choice but to part of it. We cannot leave it only to the people who want to do good. We do not have the luxury of time. I stand before you as a philanthropist and an Africapital- ist, and in a few years time, I hope we would not be able to distinguish between the two.

118 Africa Speaks: A Collection of Speeches

The Role of the African Private Sector in the Continent’s Development and Regional Integration

Speech delivered at the African Development Forum, themed, Working Together as Africans to Solve Africa’s Problems 25 February 2016

119 Tony Elumelu, CON

In order to work more collaboratively to unlock opportunities not only in the power and agriculture sectors, but in all areas of economic endeavour in Africa, there is a need for regional integration and cross border infrastructure.

– Tony Elumelu, CON

120 ur distinguished hosts: Mr. Mohamed El Kettani, Chairman and Chief Executive Officer, Attijari- Owafa Bank Group; Mrs. Zahra Maafiri, Manag- ing Director, Maroc Export; distinguished Ministers of the Kingdom of Morocco, my distinguished co-panellists including Akin Adesina, President of the African Develop- ment Bank; and distinguished ladies and gentlemen. It is a pleasure to be here with you all this morning. I want to thank the Attijariwafa Bank Group and Maroc Ex- port for convening this important discussion on investments in energy and agriculture sectors in Africa. It is very fitting that you have chosen this topic because access to electricity and food security are humanitarian emergencies on the continent. Six hundred million people currently lack access to electricity and its accompanying benefits. And, even as we gather this morning, there are countries on the continent that are battling food crises. More than ten million people are vulnerable to starvation due to a terrible drought that occurred this year in East Africa. Beyond these humanitarian emergencies, power and agriculture are two catalytic sectors that if competently and successfully addressed, can propel and sustain exponential growth and the development of every single country on the continent. If we transform the power and agriculture sectors on the continent, we will transform Africa. We will discuss these issues in detail during the various panels.

121 Tony Elumelu, CON

In the past, we were divided by colonial rulers; today, our divisions are self-inflicted by trade barriers like tariffs and borders and visas. These barriers extinguish cross-border opportunities, partnership and businesses before they are even ignited.

However, permit me to say something briefly about this gathering. I am honoured to be at this forum in Casablanca, because while we are united by geography and the African Union, North Africa is increasingly being counted as part of the Middle East. I come here today to embrace my North African brothers and sisters as fellow Africans. Similarly, I come to embrace my Francophone brothers and sisters who are also represented here in great numbers. In order to work more collaboratively to unlock opportunities not only in the power and agriculture sectors but also in all areas of economic endeavour in Africa, there is a need for regional integration and cross border infrastructure. In- tra-African trade represents about 3 per cent of total trade. In the past, we were divided by colonial rulers; today, our divisions are self-inflicted by trade barriers like tariffs and borders and visas. These barriers extinguish cross-border opportunities, partnership and businesses before they are even ignited. Despite this, the spirit of commerce and entrepreneurship can and is overcoming these barriers. I am the Chair- man of the United Bank of Africa group, which, through willpower and an unrelenting vision of Pan-Africanism,

122 Africa Speaks: A Collection of Speeches provides financial services to eight million customers in nineteen African countries. We are also a top lender to operators in the power and agriculture sectors. Similarly, the Attijariwafa Bank is providing similar services, in about a dozen Africa in countries. Another great story is that of the MTN, the South Af- rican telecoms giant that connects millions of Africans in seventeen countries through telephony. In fact, by 2013, Intra-African investments, which were almost negligible in 1990, had overtaken Overseas Development Assistance and Foreign Development Assistance, which stood at $56 billon and $57 billion respectively. My point is simple: we have common challenges, we need investment and we need development in Africa. So, the private sector has a role to play and has demonstrated that it has the capacity and can overcome some of the trade barriers and challenges we face in order to thrive. That is what I have been preaching for the last several years, that the private sector must acknowledge and embrace its role in the development of the continent, and we must work in “shared purpose” with our governments to achieve national targets in each sector, including targets like the number of new connections to the electrical grid and domestic food production targets. I call this Africapitalism. Africapitalism is an economic philosophy that advocates long-term investments in strategic sectors that deliver economic and social dividends. So, where some see only problems or challenges in Africa, I see business opportunities in providing solutions to such challenges. The Africa Develop- ment Forum is not only about business; it is about African unity. African unity should be much more than a routine

123 Tony Elumelu, CON gathering of political leaders and bureaucrats. African unity should be about shared challenges and experiences, shared ideas and goals, and bonds of trade. By acknowledging common problems and working together to solve them, we can only grow closer. As we and grow closer, we will also address the self-inflicted wounds caused by our trade barriers. That is also why I have taken a business approach to my personal philanthropy as well. Last year, we launched the Tony Elumelu Entrepreneurship Programme (TEEP), a $100 million effort, to identify, train, mentor and seed ten thousand businesses over the next ten years towards the economic transformation of our continent. Through this programme we seek to institutionalise and democratise luck, so that any African entrepreneur with a great idea, and the drive to succeed, has that golden chance. A key pillar of the programme that is so important to me is that it is open to all Africans regardless of their age, nationality, gender or religious affiliation. The first class of one

We have strong representation from the Francophone and Lusophone countries, but we are working to get even more. These entrepreneurs are not only providing moral support to each other, they are now part of an ecosystem that enables them help each other hone their business ideas and solve business problems, and amazingly, also collaborate in business deals across multiple borders.

124 Africa Speaks: A Collection of Speeches thousand Tony Elumelu Entrepreneurs, who were selected purely on the merits of their business idea, represented Afri- can countries. They completed their training, came to Lagos for a three-day boot camp to meet and bond with each other and receive their seed capital last October. I am proud to tell you that among them were four Mo- roccan entrepreneurs and an Egyptian, who told us that as an Arab, he felt defined as a Middle Easterner all his life, but always had a deep yearning to connect and identify with his African brothers and sisters, and The Tony Elumelu Foundation Entrepreneurship Programme finally made that dream come true. Because of this young entrepreneur, I now dream and strive to double applications from North African countries every year of the programme. We have strong representation from the Francophone and Lusophone countries, but we are working to get even more. These entrepreneurs are not only providing moral support to each other, they are now part of an ecosystem that enables them help each other hone their business ideas and solve business problems, and amazingly, also collaborate in business deals across multiple borders. As these entrepreneurs, shake hands and share their ideas, network, and eventually make deals, they are manifesting regional trade and integration in an organic and authentic way that will deliver both economic and development dividends in Africa. In conclusion, I believe in Africa, and I believe in the power of entrepreneurship to deliver the future we all want for the continent – a future stability and prosperity, with universal sustainable energy and food for all. Thank you.

125

Africa Speaks: A Collection of Speeches

Leadership Conversation: Investing in Prosperity

Speech delivered at the Shared Value Leadership Summit in New York, USA, themed, The Principles of Shared Value and Africapitalism 13-14 May 2014

127 Tony Elumelu, CON

The private sector must work together with governments as well as international institutions like the United Nations in order to fully realise the goals of shared value and Africapitalism.

– Tony Elumelu, CON

128 would like to personally thank Michael Porter, who has been a huge personal inspiration to me. I would also like Ito recognise my fellow panellists: Jin-Yong Cai, EVP and CEO of the International Finance Corporation, and Arif Naqvi, Founder and Group Chief Executive of The Abraaj Group. Distinguished panellists and guests, it is an honour to speak to you today about an issue that is central to my personal business philosophy – shared value. I have just come from the World Economic Forum Africa, which was hosted in Abuja last week, where the theme was inclusive growth and job creation. I believe the idea of inclusive growth is another way of talking about shared value, but on a macroeco- nomic scale. So it is gratifying to continue that conversation this week at the Shared Value Leadership Summit. Shared value is at the heart of the economic philosophy of Africapitalism, which drives every decision we make at Heirs Holdings, and is the basis of the Tony Elumelu Foun- dation. Africapitalism is a call on the private sector to invest in Africa for the long-term in key sectors of the economy that have the potential to create financial prosperity as well as social wealth. At Heirs Holdings, our investment decisions are driven not only by the goal of creating value for our shareholders, but also by the need to create social value at the same time. We call this doing well and doing good. For example, agricultural processing in Africa is a prime

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The concept of shared value is particularly relevant at this moment because it provides a framework for the private sector in developing countries to take on a leadership role in shaping the future of our nations. sector for long-term investment that adds social value. We invested in a local juice concentrate plant in Nigeria, which is the first of its kind in the country, and this is already having a positive and measurable impact on the community. We purchase oranges, pineapples and mangoes that previously would be left to rot. Previously, up to 60 per cent of the harvest would be prone to waste. In this way, we are empowering the community from farmers to the many that are directly and in- directly employed by our activities, and at the same time we have introduced technology to the country that never existed before. Though not a traditional area for social impact investing, we have also created shared value through our investments in the power sector. Through its subsidiary Transcorp, Heirs Holdings is the largest investor in President Obama’s Pow- er Africa initiative and the only major African investor. Our first major project, the Ughelli power plant in the Niger Delta region of Nigeria, has doubled output since take over. We know that increased electricity access helps to create jobs and power hospitals, schools and businesses. Because power is critical to everything from vaccine cold chains to safer

130 Africa Speaks: A Collection of Speeches cooking fuels, investing in power has a multiplier effect on the economy and adds social value while also bringing long- term returns to our shareholders. But it is not enough for Heirs Holdings alone to adopt such a philosophy. To help spread and codify the idea of Af- ricapitalism, I am pleased to announce that last week we for- mally launched the Africapitalism Institute at WEF Africa and are rolling it out across the world. Later today, we will introduce the institute to a global press audience as part of the roll out. A think tank, funded and led by Africans, the Institute will focus on rigorous practical research and multi-stakeholder engagement to advocate for public policies and business practices that will unlock opportunities for all Africans. It is my vision to create a broad movement of governments and business leaders that follow the principles of Af- ricapitalism. This is shared value in action in a whole new way. The concept of shared value is particularly relevant at this moment because it provides a framework for the private sector in developing countries to take on a leadership role in shaping the future of our nations. One reason this is such a significant moment, is that the next generation of UN development goals are currently under discussion. Last month, I had the privilege of addressing the UN General Assembly, where I discussed the role of the private sector in implementing the post-2015 development agenda. I believe it is important for a global agenda that addresses livelihoods and extreme poverty to engage the sector of society that controls the most capital, employs the most people, and fosters the most innovation. Private sector leaders must step forward to engage both in the formulation and imple-

131 Tony Elumelu, CON mentation of this agenda. The private sector must work together with governments as well as international institutions like the United Nations in order to fully realise the goals of shared value and Africapitalism. The UN development goals are a perfect opportunity to do this. Recent events in Nigeria have also made these needs more pressing, and demonstrated that we in the private sector must show leadership in resolving the underlying issues that cause insecurity – unemployment and poverty. The recent incidents in Abuja and the abduction of the schoolgirls in Borno state are tragic and demonstrate the scale of the challenge we face in Africa. However, we must also look at the deeper issues which give rise to insecurity and address them head on. A huge young population that lacks employment opportunities, and faces challenges in setting up their own businesses are increasingly vulnerable to being lured into other ways to earn a living. We cannot let this happen. These tragic events demonstrate the urgent need for us in the private sector to show leadership on the most critical issues facing our communities. I have set out a clear vision to create jobs and promote entrepreneurship initiatives to

A huge young population that lacks employment opportunities, and faces challenges in setting up their own businesses are increasingly vulnerable to being lured into other ways to earn a living.

132 Africa Speaks: A Collection of Speeches empower our people, propelling Nigeria and Africa forward on a growth trajectory that will lift people out of poverty. The private sector must therefore engage and partner with government to create a safe and secure environment to grow our businesses and uplift the lives of our employees, suppliers and customers. Never have the intertwined concepts of shared value and Africapitalism been more relevant or more critical to our future! I urge everyone here, throughout the two days of this summit and the many discussions that will follow, to consider what shared value means to your business and your country, and to think of new ways that we can enshrine these values not only in company policies but also in institutions and initiatives that reach beyond our boardrooms.

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Transforming Africa through Agriculture

Speech delivered at East Africa Exchange Launch in Kigali, Rwanda, themed, Africapitalism in the African Agricultural Sector 3 July 2014

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If we aim to improve African lives on a large scale, we must institute fundamental, revolutionary changes to the overall agricultural process that brings in private sector capital both foreign and domestic; technology that enlarges the pool of players, and institutions such as banks, all to generate solutions and value for all parties involved.

– Tony Elumelu, CON

136 stand before you as the Chairman of Africa Exchange Holdings (AFEX), and Chairman of Heirs Holdings, Ian African investment company, which pursues investments on the continent that are designed to create value for our stakeholders, create more jobs, and improve the macro- economic climate, which are consistent with the philosophy of Africapitalism. Africapitalism is an economic philosophy that promotes long-term investment in strategic sectors that will create economic and social wealth. Practitioners of Africapitalism understand that Africa’s future growth depends on the private sector making long-term investments in key sectors like agriculture that produce real profits for investors while creating long lasting, fundamental social wealth. I am delighted to be here today to launch the East Af- rica Commodities Exchange with Presidents Paul Kagame of Rwanda, Uhuru Kenyatta of Kenya, Yoweri Museveni of Uganda, and Salva Kir of South Sudan. If you are wondering why four leaders would assemble to launch a commodities exchange, the facts are that the world’s population will reach 9.1 billion by 2050 and half of that growth is projected to come from Africa. Farmers will need to grow 70 per cent more food to keep up with the additional population. Sev- enty per cent of the world’s population of employed people are engaged in the agricultural sector. Africans desire development, and no leading economy

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Africans desire development, and no leading economy has ever developed without making significant progress in the agriculture sector. Therefore, agriculture is a key transformative sector for Africa,

has ever developed without making significant progress in the agriculture sector. Therefore, agriculture is a key transformative sector for Africa, and to make progress in Africa, we must make progress in agriculture. We must have food security. We must have food self-sufficiency. The private sector has the innovation and entrepreneurial capacity to make up this food production gap, but needs government to create the enabling environment required to succeed. So if we do not want to forever consign ourselves to the images of donor aircrafts landing to save our starving fellow Africans, what Africa must do is grow more food, increase access to markets and get better and more stable prices for our farmers. How Africa must do it is by treating agriculture as a business sector that generates jobs, taxes, revenues and commercial value, and not as a government welfare programme. Because despite increased commitment and spending by governments in agriculture, the challenge of attaining food sufficiency is bigger than the might of any single sector or actor. In spite of all the good intentions, strategies and dollars of donors, this cannot ensure food security, without private sector investments and expertise. Governments, do-

138 Africa Speaks: A Collection of Speeches nor agencies, or the private sector cannot fix it alone. They must all work together. If we aim to improve Africans lives on a large scale, we must institute fundamental, revolutionary changes to the overall agricultural process that brings in private sector capital both foreign and domestic, technology that enlarges the pool of players, and institutions, such as banks to generate solutions and value for all parties involved. And that is exactly what the East Africa Exchange Launch (EAX) does. That is why you see here governments, the private sector and international financing and expertise coming together to support this launch. EAX puts our smallholder farmers at the centre of our business model because they are the most critical actors in any food security strategy. EAX is a commercial platform that will give farmers access to multiple and competing buyers in more markets, so they can get up to 25 per cent more for their produce, gain access to credit and financial services by making them bankable, and help them to reduce postharvest losses, through warehousing. The overall effect will be to increase their income and

EAX is a commercial platform that will give farmers access to multiple and competing buyers in more markets, so they can get up to 25 per cent more for their produce, gain access to credit and financial services by making them bankable, and help them to reduce postharvest losses, through warehousing.

139 Tony Elumelu, CON transform their lives and communities, an outcome that is consistent with the philosophy of Africapitalism. Given that guiding principle, there is a clear need for more private sector players to commit to these kinds of initiatives. Heirs Holdings and the Tony Elumelu Foundation have partnered with Berggruen Holdings and 50 Ventures, using NASDAQ technology, to bring commodity trading that will increase market efficiency in the East African region and empower farmers. The intent of AFEX is to establish such exchanges across Africa, in a manner that encourages integration across borders. In light of this, in recognition of how far the East African Community has moved in this direction, we started here. I have done this before by establishing the United Bank for Africa in nineteen African countries. The secret to that success was working and partnering with local and regional investors. In the case of EAX, this will be no different. The track record speaks for itself in this regard and we look forward to welcoming new investors to the EAX. I am African, so making an investment on the continent that will impact lives is something I need to do, because if Africans do not do it, who else will? I therefore want to give special recognition to both Nicholas Berggruen and Jendayi Frazer who genuinely believe in Africa’s potential and have personally invested their own money and time to make AFEX a success. We need more partners like this – Western partners looking for genuine and mutual partnerships with the African private sector. I want to pay tribute to the presidents here for their visionary leadership that recognises that in the twenty-first century some problems can be better solved through region-

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I am African, so making an investment on the continent that will impact lives is something I need to do, because if Africans do not do it, who else will?

al cooperation. Specifically, I want to commend President Paul Kagame for creating the right enabling environment to attract investors like me. In addition, I want to thank him for his personal interest and commitment in making EAX take off here in Kigali. I must especially pay tribute to our smallholder farmers, most of who are women. They work long and hard, often in isolation and economic vulnerability, to feed not only their families, but also entire nations, and ultimately the world, and who have too long gone unnoticed. No longer will this happen because we now understand that the transformation of Africa will happen farmer by farmer, and that what is good for our farmers, is good for all of us. Thank you.

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Challenges and Opportunities in the Power Sector in Africa

Speech delivered at The Congressional CEO Dialogue During the African Leaders Summit in Washington D.C., themed, Advocacy for the Energise Africa Act and Africapitalism 6 August 2014

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If Power Africa is enhanced and expanded through this legislation, it can pay economic dividends to both the US and Africa, while delivering substantial development gains on the continent.

– Tony Elumelu, CON

144 am honoured to be here with all of you. I want to begin by thanking President Obama for hosting this historic Ifirst time US-Africa summit, and for recognising that there is in fact a growing and thriving business sector on the continent that is capable of partnering with the US business sector for mutual economic benefit. I also want to thank the CEOs from the continent, for stepping up as ambassadors of the African private sector to potential new American partners. I especially want to thank Congressman Greg Meeks for hosting this CEO Dialogue on Capitol Hill to further expand opportunities for US and African business leaders to meet, interact and advance US-Africa business relations. I am here to deliver two simple messages: one to the US private sector and the other to the United States Congress. To American CEOs, I want to thank you for being open to expanding your business interests to the African continent. You would have heard plenty about the warmth of the Afri- can people, but what I hope you see are African CEOs who embody the confidence and the competence of the African private sector, defined by proven success on the continent and by any global standard; representatives of African countries and companies that have made significant cross-border investment progress; representatives of countries that are some of the fastest growing economies in the world as evidenced by the performance of Nigeria, Rwanda, Mo-

145 Tony Elumelu, CON zambique and Tanzania; and countries that are making great strides that run counter to the negative press stories, focused on terrorism, disease and corruption. Nigeria for instance, gets mostly bad press, and yet a recent rebasing exercise has established Nigeria as the continent’s largest economy, driven by diversified sectors like telecoms and a thriving film industry, proving that we have a lot more to offer investors than our natural resources. Lastly, I hope you see business leaders who have come to D.C. to seek American partners who want to invest in key sectors of our economies for the long-term, to seek partners who will share our goal of creating local value and contributing to our development aspirations. I call this Africapital- ism. That is, long-term investments in strategic sectors that will yield both economic and social value. My second message is to the United States Congress. First, I come offering the deep thanks and appreciation from my people. This body, the US Congress, is responsible for appropriating the funds that demonstrate America’s values and generosity to the world. I speak of the massive and bi- partisan President’s Emergency Plan for AIDS Relief (PEP- FAR), which galvanised global action to prevent the down- ward economic and social spiral caused by the global AIDS pandemic, which African countries were ill-equipped, at the time, to handle on our own. The US government also provides much more life-saving assistance in the form of vaccines, food aid, support for peacekeeping and refugee assistance, among others. That is why USAID is one of the greatest institutions, not only in this country, but also in the world. The African private sector needs a healthy workforce now and in the future, so USAID’s

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The African private sector needs a healthy workforce now and in the future, so USAID’s health, agriculture and education programmes, etc., have impact on the business sector and contributes to long-term national economic growth and poverty reduction in Africa. health, agriculture and education programmes, etc., have impact on the business sector and contributes to long-term national economic growth and poverty reduction in Africa. And now I want to urge the Congress to remember that no country or region should be defined by its challenges. Drugs should be not the defining feature of US relations with Latin America, religious conflict should not be the defining relationship between the US and the Middle East, and natural resources and humanitarian assistance should not constitute the totality of Africa’s brand and policy in the United States. We have been discussing the challenges and opportunities in the power sector in Africa to help light up the continent, power our economies and help the 589 million Afri- cans who are living without access to electricity and opportunity. President Obama’s Power Africa Initiative is a great start, but to be sustainable, it must be codified as a long-term priority for US foreign policy. I understand that Congress is currently trying to resolve the differences between the En- ergize Africa Act, and Electrify Africa Act – that has already been passed in the US House of Representatives.

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I want to say to Members of Congress that we understand that you have genuine differences. We also understand that the nearly two million people dying from the effects of fire cooking every year; the tonnes of harvests rotting from lack of power for processing, preservation and transportation; the ninety million kids who cannot study at night; and the staggering rates of unemployment on the continent, are much bigger than your differences. If Power Africa is enhanced and expanded through this legislation, it can pay economic dividends to both the US and Africa, while delivering substantial development gains on the continent. One such gain would be a significant reduction in the operating costs of businesses that will come in to invest in other sectors. This legislation, along with an enhanced fifteen-year reauthorisation of the Africa Growth and Opportunity Act (AGOA), will help lay the foundation for a new US-Africa relationship; one based not on humanitarian assistance, but on partnership for mutual economic benefit, and one that allows entrepreneurship to be the engine of social development. In closing, I want to say that for a long time, the perception of Africa has been money leaving your wallet, through charity and taxes. I am here to tell you that engaging with Africa in business will put money in your wallet, but only if you make the call to in invest in Africa. And after you make that call, make a phone call to your Senators. Tell them you want to pass the ‘Energize Africa Act,’ so you can do more business in Africa. Thank you.

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Entrepreneurship, Corporate Social Responsibility and Africapitalism

Speech delivered at National Institute for Policy and Strategic Studies, Kuru, Plateau State, themed, The Role of the Private Sector in Fighting Poverty in Nigeria 23 August 2016

149 Tony Elumelu, CON

These young men and women are once again hopeful for a better tomorrow. This is key because hope addresses anxiety and keeps young people away from extremism, vandalism, and from drugs, among other things. And every day, as these entrepreneurs create new jobs and new products, we are chipping into the mountain that is extreme poverty.

– Tony Elumelu, CON

150 ver one billion people live on less than $1.25 a day worldwide. These are known as the bottom bil- Olion. Of those, in 2012, three hundred and thirty million were identified as Africans living in extreme poverty, up by fifty million, from two hundred and eighty million in 1990. According to some experts, today, up to 70 per cent of Nigerians can be classified as living in extreme poverty. This represents a significant increase from when the World Bank did the exercise, during the Obasanjo Administration when it was determined to be under 50 per cent, though part of it is attributed to a change in the methodology of their calculation. So the sad fact is that despite valiant efforts by the government over the last thirty years, from “Austerity” to the “Structural Adjustment Programme” to “MAMSER” to “SURE-P”, and the National Poverty Eradication Pro- gramme, poverty is on the rise in Nigeria. Long before we suffered the economic blow of the plummeting of commodity prices, poverty was on the rise. But Nigeria’s problems are not unique on the continent. African countries share the common challenges of poverty and underdevelopment. To be sure, these statistics can be overwhelming. But I am also sure that this fight can be won. The essence of this is captured in the documentary you just saw, because I am certain that the fight against poverty is not a Herculean task to be fought by a heroic government as

151 Tony Elumelu, CON the sole actor, and neither is it a fight to be fought by donor agencies. It is an epic saga that must be fought by multiple actors, not only to pull everyone out of poverty, but also to keep future generations out of poverty. And despite the seriousness of the situation and the millions of lives that are often on the line, I am also convinced that, as much as possible, our interventions should approach the challenge of poverty with great optimism because that is the way we will be able to recruit more people into the fight, and why they will stay in the fight. The documentary you have just watched is a chroni- cle of the creation and the first cycle of the Tony Elumelu Foundation’s Entrepreneurship Programme. Some of you might have already seen the feature on some of the beneficiaries of the programme done by PBS channel for a US audience. TEEP represents my response, as a private sector actor, to the challenge of poverty, not just Nigeria, but the entire continent of Africa. As you can see from the faces of the beneficiaries of the programme – and our focus on job and wealth creation – we are together approaching it with zeal and great optimism. My greatest contribution is not the money. It is the fact that they can relate to me, and to I can say to them: if I succeeded, you can too. These young men and women are once again hopeful for a better tomorrow. This is key because hope addresses anxiety and keeps young people away from extremism, vandalism, and from drugs, among other things. And every day, as these entrepreneurs create new jobs and new products, we are chipping into the mountain that is extreme poverty. It is important to understand though that this entrepre-

152 Africa Speaks: A Collection of Speeches neurship programme is unique because it is underpinned by a solid business strategy and philosophy that will ensure the sustainability of the outcome of our investments in these entrepreneurs and the future of Africa. The programme represents the Tony Elumelu Foundation’s commitment to invest $100 million over the next ten years to identify, train, mentor and seed ten thousand African businesses. We aim to create one million new jobs and $10 billion in additional revenue for the continent by democratising and institutionalising the “luck” that I had as a young man that led me to significant levels of success in the Nigerian and African private sector. Additionally, we are identifying and advocating for policy reforms to enable not just the Elumelu Entrepreneurs, but also all African entrepreneurs with the will to succeed because ultimately, what we are seeking is the economic transformation of Africa. And the response has been overwhelming. In its inaugural year, we received twenty thousand applications for the one thousand slots and, this year, more than forty-five thousand aspiring entrepreneurs applied. This October, we will host another class of one thousand budding entrepreneurs from fifty-three countries in Africa, at the Elumelu Entrepreneurship Forum in Lagos. The programme and the forum will serve to empower and inspire them, but more importantly, teach these young Afri- cans how to become fishermen. I am proud to tell you that in the Class of 2015, there were four hundred and eighty Nigerian entrepreneurs numbered, represented from all thirty-six states. This year, Nigerians make up 60 per cent of the top one thousand, bringing the total number of Nigerian entrepreneurs in our

153 Tony Elumelu, CON programme to one thousand and eighty-one. The fact that Nigerians make up more than half of the two thousand beneficiaries chosen in a merit-based selection process led by Accenture, and represented from every state in the federation in the two years of the programme, are testaments to the strength of the entrepreneurial spirit in our Nigerian youth. Let me share with you four concrete examples of what some of these Nigerian entrepreneurs are doing that help to fight poverty through profit-making and sustainable solutions. In the ICT sector, one of the Elumelu Entrepreneurs, Nasir Daniya from Sokoto State, has created an app to link all Nigerian police stations together with photos of wanted individuals, a critical gap in our national security coordina- tion. Kehinde Yinusa, another beneficiary of the programme from Lagos State, has created cost-effective “birthing kits” with essentials to aid midwives and birth attendants in the birthing process to help reduce maternal and child mortality. He is now scaling up the distribution. A third entrepreneur, Nkem Okocha, is crowd-sourcing funds to lend to female micro-entrepreneurs and teaching them new trades to support their efforts to lift themselves out of poverty. She is now collaborating with a fourth entrepreneur, Chioma Ukonnu, who has started a recycling business that collects waste products for reuse in South-Western states to help protect the environment and generate income for unemployed and poor Nigerians. These are all private sector solutions to pressing development challenges facing our country and continent, and they are available right here in Nigeria, from our own youth. Even better, these entrepreneurs are collaborating with each

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I believe that along with poverty, our greatest challenges in Nigeria and Africa includes untapped human potential, and a great deal of that potential exists among the poorest, the unemployed and the young.

other to amplify their business reach and impact on our un- derserved population. At the micro level, with their insight and innovations, many of these start-ups and small businesses are taking a bottom up approach to economic and social development, utilising private sector capital and expertise to drive the creation of home-grown solutions to local problems in core areas such as food, education, health, water and sanitation, among other areas. At the macro-level, they are an expression of Nigeri- an solutions to Nigeria economic and social problems, and with each business they grow, with each job they create, and with each naira they generate, they are helping to create a tide of prosperity that will lift families, communities and our nation out of economic stagnation and despair, and into a future of dignity and development. Now how does the Tony Elumelu Foundation’s entrepreneurship programme relate to poverty reduction? Well, like most people, I could not be a bystander to the suffering of my fellow Africans and the negative narrative and imagery that represent the world’s perception of our continent, especially being an African that has been so blessed with opportunity and prosperity by this very maligned continent.

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After several years of thinking it through, I came to the conclusions that if Africans are serious about eradicating poverty and achieving development, and changing the narrative about our continent, we must acknowledge the following: that no one but us will save ourselves. The development of Africa is up to Africans. Donors and partners can help, but the work of developing our nations is ours. There is a prevailing development paradigm, which has not worked. The traditional approach to development has been for governments and donors to invest in basic health, education and access to food in developing countries, with the hope that the beneficiaries will eventually become self-sufficient. But I also believe that if we help people become self-sufficient, by providing them with jobs and economic opportunity, they will purchase those same basic goods and services that governments and donors are struggling to provide. Basically, humanitarian assistance and economic opportunity are two sides of the same development coin, and we tend to focus on the former at the expense of the latter, with limited results. So, we must elevate jobs economic opportunity as a tool for fighting poverty and promoting development. Governments do not have the capacity to provide the basic daily needs or employment for the millions of young Nigerians entering the job market every year. Therefore, the private sector must be an integral part of our national poverty eradication and development strategy, and it is this last point that led me to develop the economic philosophy of Africapitalism and the imperative to nurture a generation of entrepreneurs who identify as Africapitalists – private com-

156 Africa Speaks: A Collection of Speeches panies that create financial and social impact in their chosen sectors and geographies. Africapitalism is borne of my own experience of investing in the private sector. When I stepped down as the CEO of UBA in 2010, and established Heirs Holdings, I was venturing out from my comfort zone, as a banker, into new territory, as an entrepreneur. To help guide my investment decisions, I took some time to reflect on what principles, practices and decisions had underpinned the success of Standard Trust Bank and UBA, what I had learned and what impact I wanted to make in all my new endeavours. I found that I wanted to create wealth, promote development in Nigeria and across Africa; do it from the private sector and deliver societal benefits, and that is how the concept of Africapitalism was birthed. I believe that along with poverty our greatest challenges in Nigeria and Africa includes untapped human potential, and a great deal of that potential exists among the poorest, the unemployed and the young. Therefore, our development agenda should not just be about fighting poverty, it should be driven by strategies that centre on building capacity and unleashing the potential of millions of marginalised citizens – the continent’s greatest and most abundant natural resource. This modern development agenda should be about creating jobs, unlocking entrepreneurial opportunity, spreading prosperity and catapulting the country as a significant player in an industrialised global economy, as opposed to one, which operates on the periphery. I think this new attitude to development deserves its own approach – Africapitalism. Af-

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This modern development agenda should be about creating jobs, unlocking entrepreneurial opportunity, spreading prosperity and catapulting the country as a significant player in an industrialised global economy, as opposed to one, which operates on the periphery. ricapitalism asserts that the private sector has a leading role to play in the development of Africa. A role it must recognise and embrace. Specifically, Africapitalism promotes long- term investments in strategic sectors that deliver economic dividends for shareholders and social dividends for society. Africapitalism is needed because if African governments and the private sector continue to operate in parallel, at best it is a recipe for “mutually-assured mediocrity”. However, if African governments and businesses are connected by a shared philosophy, common principles and coordinated objectives for trade and investment promotion, it will deliver the shared prosperity we seek. Essentially Af- ricapitalism requires the government and private sector to work in “shared purpose”. Now, one of the areas I have been asked to speak about is Corporate Social Responsibility (CSR) as a tool of fighting poverty. I think CSR is very valuable. It is helpful in saving and improving lives as well as creating economic opportunity. It is important for good community relations by ensuring that the local community benefits from some of the value being derived in their community. In fact, all my companies

158 Africa Speaks: A Collection of Speeches practice CSR to develop the communities in which we operate. However, if our collective objective is transformative development on a macro-scale, CSR is not enough. We have got big problems and we need big ideas that deliver big results. In my view, CSR does not go far enough to deliver sustainable development on the scale that Nigeria requires. This is where CSR differs from Africapitalism. First, CSR is an activity of large corporations and Africapitalism is practicable in all sizes of businesses. Secondly, CSR involves large companies carrying out their regular businesses, and allocating a small share of their profits to social programmes at the end of the fiscal year – but not always in the communities in which they operate. Africapitalism is not about what a company does for the community after it has done its business and generated profits. Africapitalism is about how a company goes about its business and what kind of business it engages in, to ensure that its very existence, strategies and operations generate profit and serve society. So, I recommend an Africapitalist approach to business, with CSR augmenting it, after profits are derived. This brings me back to entrepreneurship. Entrepre- neurship is a key feature of Africapitalism and it is the philanthropic pathway I am using to promulgate Africapitalism to promote development across Africa. I shared with you earlier that I believe that economic opportunity has equal ability to fight poverty and promote development. Also, I told you about my own practise of Africapitalism and the success it has created for me personally and in the countries in which my businesses operate. I have also told you that I believe that nobody but us will develop our country and

159 Tony Elumelu, CON continent. These beliefs have led me to understand that I have an additional responsibility to replicate my success and create one thousand more Tony Elumelus and UBAs to help stimulate the economic transformation of Africa by nurturing the next generation of Africapitalists. So I would argue that to effectively fight poverty and achieve “shared prosperity”, we must promote entrepreneurship, as a national priority. Governments and large corporations do not have the capacity to provide employment for the tens of millions of young Africans entering the job market every year. Therefore, we must empower them to create their own livelihood and in the process possibly create jobs for others. This means that they take charge of their futures by starting their own businesses. Many of them have deep insight into their local markets, consumer needs and ideas for locally-generated solutions, but they are shut out of the formal economy by bureaucratic and regulatory obstacles, policy gaps and a perennial lack of access to capital, markets and training. There are millions of entrepreneurs out there with mil-

Nigeria, and indeed Africa’s, transition from poverty eradication to sustainable development is an unfolding journey, and the destination is not as important as who we carry along. For too long, our governments have tried to go it alone and it has not worked.

160 Africa Speaks: A Collection of Speeches lions of ideas that can help achieve the economic transformation of this country and our whole continent. And I am not alone. For the last several years, President Barack Obama has hosted a global entrepreneurship summit to engage young people positively in creating jobs to occupy themselves and others, stabilising their communities and helping to grow their national economies. The Tony Elumelu Foundation is a founding co-chair of “Spark”, the private coalition that partners with the US government to spread the message of economic opportunity as a path to prosperity and national development. I also continue to engage African leaders, at the presi- dential level, on the transformative impact of entrepreneurship, by bringing along their home grown entrepreneurs to share what they have been able to achieve with the support of the Tony Elumelu Foundation and what the government can do to improve the enabling environment for their success and other entrepreneurs in their country. Here at home, I am encouraged by some of our government’s programmes to support young entrepreneurs, but we must do more to help more of them. We need to think bigger. Other African countries have seized on this. The government of Cote D’Ivoire for instance has decided that with my foundation’s technical assistance, they will duplicate our entrepreneurship programme to expand and support thousands of more Ivorian entrepreneurs. In Uganda, we have been asked to support an industrial park for startups. We are also developing partnerships with state governments in Nigeria to assist them in identifying and supporting their entrepreneurs. I believe that, more than anything else at this point, en-

161 Tony Elumelu, CON trepreneurship is the key to Africa’s economic salvation and elevation, and I urge you all to use your influence to promote it as one of our key strategies for eradicating poverty in Nigeria. Let us adopt an affirmative action. As you go back to your respective institutions, you will take at least one policy action that helps our entrepreneurs to succeed because their success is our national success. In conclusion, I want to say that Nigeria’s poverty and development challenges are great, but they do not exceed the capacity of our people to solve them. Albert Einstein said that definition of insanity is doing the same thing over and over again and expecting a different result. We live in a new era, one of sustainable development, and we require a new philosophy of development and way of doing business. Af- ricapitalism provides both, and demands shared purpose for shared prosperity. Nigeria, and indeed Africa’s, transition from poverty eradication to sustainable development is an unfolding journey, and the destination is not as important as who we carry along. For too long, our governments have tried to go it alone and it has not worked. Those governments that have learned the lessons of the past are those that will carry along the private sector, academia, civil society, aspiring entrepreneurs and, most especially, the poorest and most vulnerable among us, along this path to progress and prosperity. The good news for you, our policy leaders here today, is that you do not have to carry me along, I am already here, ready to walk with you and work with you. Thank you.

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The Private Sector’s Role in Expanding Access to Electricity Across Africa

Speech delivered at African Development Bank’s New Deal for African Energy Conference, themed, Advocacy for the Progress of the Power Sector in Nigeria and Contribution of the Private Sector London 17 September 2015

163 Tony Elumelu, CON

Increased power supply can have a massive impact on addressing the current youth job crisis in Africa. If African industries can operate at full capacity and compete globally, tens of millions of new jobs will be created across the continent.

– Tony Elumelu, CON

164 t is an honour for me to be here today for the first high-level gathering under President Adesina’s leader- Iship. When I heard him give his inaugural address a few weeks ago, during which he stated that expanding access to electric power to millions of Africans was one of the corner- stones of his first term, I was very pleased and encouraged. The speed with which he has now set out to implement this vision for Africa’s power sector is a testament to how central this issue is for Africa’s overall economic transformation. My role here today is to provide the private sector perspective on Africa’s power deficit and offer suggestions as to how business can play its part in expanding access to electricity across the continent. My point of view is shaped by my experience as a banker, entrepreneur and investor, and through my active participation in several efforts to accelerate a resolution to this critical challenge. On the national level, I serve as the chairman of the association of power generation companies, at the continental level, as founding co-chair of the Africa Energy Leaders Group, and at the global level as a board member of the UN Secretary Gener- al and World Bank President’s “Sustainable Energy for All” Initiative. I have also testified before the US Senate on the Electrify Africa Act, and addressed the UN General Assem- bly on the importance of energy as a development priority as part of the new Sustainable Development Goals.

165 Tony Elumelu, CON

If African industries can operate at full capacity and compete globally, tens of millions of new jobs will be created across the continent. In addition, the power sector itself can generate three million new jobs.

During the power sector privatisation in Nigeria, we took a strategic decision to invest in a big way in the Nigeri- an – and eventually African – power sector. This was driven by our confidence that the sector had the potential for a great financial return, while it would also contribute significantly to Africa’s economic and social transformation – the sweet spot for my investment philosophy of Africapitalism. We entered the space with such confidence that on July 2013, I made a commitment to President Obama’s Power Africa Initiative to invest $2.5 billion in the sector. This bold commitment started becoming a reality when we invested in a 1000MW capacity gas generated power plant in Ughelli, Delta State in late 2013. Transcorp, a listed Nigerian conglomerate that I chair, acquired the plant from the Nigerian government as part of the power privatisation process. When we acquired the plant in November 2013, it was generating only 160MW – a fraction of its installed capacity of 1000MW. Within one month, generation capacity was increased to 340MW and by the end of 2014 we were generating 610MW. This represents a 78 per cent increase year-over-year and a 300 per cent increase from takeover. What we saw was the best that the private sector had

166 Africa Speaks: A Collection of Speeches to offer and the great potential the power sector in Nigeria had to generate a healthy return while creating social impact. Our strategic intent was to increase the capacity of the plant to 2500MW in partnership with GE and others over a three- year period. This and other targeted acquisitions were set to fulfil the bold Power Africa commitment. However, what started brightly has now been stalled significantly. Today, the plant can generate up to 850MW, but due to various issues in the power sector ranging from gas supply, transmission capacity, and off take payments, the average output is about 350MW. These issues have also forced us as investors to put on hold our ambitious expansion plans, essentially meaning there is about $1.5 billion that is still waiting to be deployed. Not because Nigeria does not desperately need more power, but because at the end of the day we are not a not-for-profit organisation, and if the potential for profits are threatened by government stumbling blocks, as investors we must pause. Let us now step back to put all this in perspective. Fifty per cent of people in the world living without power re- side here in Africa, in sub-Saharan Africa that is six hundred million people without access to electricity. The installed electricity capacity in sub-Saharan Africa, excluding South Africa, is only 28,000MW, which is equal to the capacity in a single country – Argentina. Perhaps most disconcerting is that despite a sustained focus on addressing this challenge by many stakeholders, in thirty-seven sub-Saharan African countries. The number of people without electricity has actually increased since 2000 as their populations are growing faster than electrification efforts. Even worse, one-quarter of Africa’s existing electric

167 Tony Elumelu, CON generation capacity is inoperative because of aging plants and poor maintenance. The power deficit is not an abstrac- tion. The lack of reliable energy in Africa costs lives – seven hundred and thirty million people in sub-Saharan Africa heat their homes and cook using traditional fuels such as wood, charcoal, and other types of biomass. Studies have shown that inhalation of smoke and fumes result in an estimated four million deaths per year, mainly among women and children – that is more deaths than from malaria and HIV/AIDS combined. The impact of the energy deficit can be repeated in sector after sector from healthcare to education, and, to something I am particularly passionate about – the ability of entrepreneurs to turn dreams in to reality in the face of exorbitant power costs. On the flip side, increased power supply can have a massive impact on addressing the current youth job crisis in Africa. If African industries can operate at full capacity and compete globally, tens of millions of new jobs will be created across the continent. In addition, the power sector itself can generate three million new jobs. The size and scope of the challenge we face is clear: whatever has been done in the past to electrify the continent is insufficient. We need new players, new partnerships, new policies, and new platforms to succeed, and what President Adesina is introducing here will help provide some impetus. It is my strong belief that the private sector must be an integral part of Africa’s energy future. To begin to address this problem, 7,000MW of new generation capacity must be built each year – seven times the annual average of the last ten years – that equates to US$300 billion in investment if sub-Saharan Africa is to achieve the previously agreed goal

168 Africa Speaks: A Collection of Speeches of universal electricity access by 2030. Only the private sector has the capital and the capacity to invest at such a scale over a sustained period of time. As an investor in the power sector, there are a number of practical points I would like to make. First, as seen from our Transcorp Power experience, capital is not the issue. We have capital to deploy, but due to government policy, non-payment of off take agreements, poor transmission infrastructure and other issues, we have had to put expansion on hold. This is the case faced by many other investors like myself. With the right frameworks in place, the capital will follow. More importantly, success begets success and other investors will follow. Second, considering the scale of the energy deficit, we cannot put too much emphasis on renewable energy as opposed to more traditional power generation sources. Africa has an abundance of sources for renewable and non-renew-

…We need less political interference in the power sector. In the early days of the telecommunications liberalisation across Africa, for the most part governments did not mandate tariffs. While the costs were initially exorbitant, over time market forces led to adjustments so that, for example, instead of paying large sums for SIM cards, they are now given out for free. The power sector should be reformed with a similar approach.

169 Tony Elumelu, CON able energy and so we should use both in abundance when appropriate. As Africa contributes to less than 2 per cent of global carbon emissions, it is not right to push Africa towards a low carbon development path considering the social and economic cost of insufficient power supply. Any solution, and any platform to address the African energy deficit must include all types of power generation if we are to really make an impact at the scale required. Third, we need less political interference in the power sector. In the early days of the telecommunications liberalisation across Africa, for the most part governments did not mandate tariffs. While the costs were initially exorbitant, over time market forces led to adjustments so that, for example, instead of paying large sums for SIM cards, they are now given out for free. The power sector should be reformed with a similar approach. Fourth, and finally, I call on the African Development Bank to play a bigger role in Africa’s power sector than capital provision. The AfDB provides a unique and powerful pan-African convening platform and bully pulpit that can be leveraged for greater effect across Africa. The bottom line is that hundreds of millions of Afri- cans need more from all of us if they expect to have consistent access to electricity in their lifetime, and it will take a concerted effort by government, business, international organisations, and NGOs to make it happen. The barriers to developing the energy sector in Africa are not just about money and skills, but also a lack of political will. Public leaders need to be willing to make the hard choices, and learn from successful privatisation and liberalisation processes in

170 Africa Speaks: A Collection of Speeches the past. This is something that the AfDB is uniquely suited to address. All of us need to work together, regardless of whether we are in the private, public, and social sector, and regardless of what type of development path we believe is best for Afri- ca. Despite the challenges we face to bring power to millions of Africans, I am hopeful. What we have been able to achieve with the Ughelli plant in a short period of time is encouraging, but it is also emblematic of the amount of work that is left to be done. We are all fortunate to have the leadership of President Adesina bringing us together in a forum like this to find lasting solutions for the short and long-term benefit of all Africans. This seemingly insurmountable task for Africa is achievable so let us work together to create the Africa of our dreams. To President Adesina, success with the power sector is success in enabling Africa to assume its rightful position in the comity of nations. Good luck. The African private sector is ready to work with you to make this a reality.

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Africa Speaks: A Collection of Speeches

Increasing Economic Ties: Investment Opportunities in Africa

Speech delivered at sponsored event by Thomson Reuters and the US Chamber of Commerce, themed, Changing the Perception of the Risk of Doing Business in Africa 22 September 2016

173 Tony Elumelu, CON

Literature and common sense tell us that business is not about risk avoidance, it is about risk mitigation, and the higher the risk, the higher the reward.

– Tony Elumelu, CON

174 want to start by thanking Thomson Reuters and the US Chamber of Commerce for this kind invitation to speak Ito you today. I also want to commend you for highlighting this important topic that must be addressed if we are to increase and strengthen US-African economic ties, the objective, which has brought both business leaders from Africa and the Unit- ed States to join our political leaders, as they also attend the opening of the US General Assembly. Let me first start by stating the obvious. For any investor or business to consider venturing into a market, there must be opportunity and there must be the potential for good returns. As an investor, I can tell you that there is opportunity in Africa, particularly in the following areas: power, oil and gas, infrastructure, ICT, real estate, agriculture, healthcare, among others. However, any investment in Africa comes with a perception of higher risk, and we know that often times, perception is as powerful as the truth. The kinds of perceived risks associated with doing business in Africa include high volatility, policy inconsistencies between African countries and governments when political transitions occur, ease of doing business (with the exception of Rwanda and South Africa, African countries rank very low on the World Bank’s Ease of Doing Business Index), infrastructure deficits, reg-

175 Tony Elumelu, CON ulatory challenges, macro-economic challenges, corruption and political rigidities, among others. However, these risks are not insurmountable. Litera- ture and common sense tell us that business is not about risk avoidance, it is about risk mitigation, and the higher the risk, the higher the reward. You can tell from World Bank statistics that Africa rewards its investors richly, particularly those that take a long-term approach to their investments. Companies operating in Africa that have succeeded have learned how to live with and manage institutional rigidities and structural challenges in their operating environment, and converted them to competitive advantages. Here are some case studies. Financial sector: The United Bank for Africa. UBA had a long-term ambition of living up to its name and becoming a pan-African bank. However, there were two key risks associated with the African expansion: lack of human capital and institutional rigidities. UBA resolved the issue of lack of human capacity by establishing the UBA Academy to provide in-house training and professional development for its staff on a rolling and continuous basis. In the case of institutional rigidities, East Africa was a key market in the UBA expansion. However, the Kenyan authorities refused to grant the bank a license to operate as a domestic retail financial institution. UBA dis- regarded issues of perceived risk, such as the lack of trust in Nigerian investors as potentially fraudulent (419), and refused to be deterred. Instead, it focused on managing the real or technical problem, which was the denial of the licence due to the lack of a proper framework to govern the employment of Kenyan and Nigeria nationals in the country.

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I always say that where there is a challenge, there is an opportunity. The question is, where is the will?

UBA managed this real risk by engaging the Nigerian government to negotiate with the Kenyan government a framework that would establish rules/regulations for companies to deploy staff in the country. This was successfully accomplished and UBA has been operating in Kenya since then. In addition, our efforts have benefitted other Nigerian and Kenyan businesses that want to operate in each other’s countries. So, managing this risk was a win for UBA, a win for countless businesses and a win for the Nigerian and Ken- yan governments in promoting regional trade and increasing their government revenues. Policy inconsistencies: When the Nigerian government decided to reform the domestic power sector and turn it over to the private sector, Heirs Holdings saw an opportunity to make a profit for it is shareholders through its Transcorp subsidiary, while making a significant contribution to the economic development of the country. Under the terms of the PFA, the tariffs for power would be centrally controlled but adjusted should any one of the following conditions occur: negative macro-economic impact and the cost of gas/ fuel for the power generation plants were to rise. However, by 2015, the two conditions had occurred, but due to overwhelming public pressure, and in an election year, both the outgoing and incoming governments were re-

177 Tony Elumelu, CON luctant to adjust the tariffs. This had a very costly impact on the power generation companies, as we had financial obligations to creditors, suppliers and shareholders to honour. We managed this risk by coming together to form an association of power generation companies to engage in collective advocacy with the government in a united and coordinated manner, and we were very successful. Now, clearly there was a significant risk to us with the policy inconsistency of the government. However, the power sector is a long-term investment proposition, but I can tell you in all honesty that Transcorp turned a profit in the first year of our investment in that sector. As I said earlier: high risk, high reward. Lack of a skilled workforce: As I described earlier with the case of UBA, accessing a skilled workforce on the continent is a challenge. However, that did not deter General Electric, a global leader in the power space. GE has previously mobilised companies like Heirs Holdings and the Dangote Group, which operate across the continent, to develop a private sector initiative to address the critical skills gap on the continent needed to operate effectively and efficiently, spur growth and attract new investors. In closing, I will reiterate that business is not about risk avoidance; it is about risk mitigation. Investment in Africa, like anywhere else, comes with some level of risk but it must be approached with optimism. And there is reason to be. After all, moguls like Carlos Slim and Aliko Dangote, two of the most successful entrepreneurs in the world, have successfully grown business in developing countries. I always say that where there is a challenge, there is an opportunity. The question is where is the will?

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Building a Global Conglomerate on Corporate Governance Values

Speech delivered at 2015 Institute of Directors (IoD) Nigerian Biennial Lecture at Metropolitan Club, Lagos, themed, The Importance of Good Corporate Governance 14 June 2015

179 Tony Elumelu, CON

I would rather have someone who on a scale of 1 to 10 will produce 6 over 10 in profitability and highly compliant than appoint someone who will rate 9 of 10 in profitability but not compliant because in the long run, that performer will destroy value for the entity.

– Tony Elumelu, CON

180 ood evening distinguished council members here present. GI would like to thank the Institute of Directors (IoD) for the opportunity to discuss a very topical issue, corporate governance, especially from my own perspective. I would like to thank you for inviting me to share my perspective in an iconic and historical place – the Metropolitan Club. The topic of today’s lecture is “building a global conglomerate on corporate governance: values, challenges and benefits in a developing economy”. We are lucky to have the chair of the Institute of Directors (IoD) as the chair of one of our investee companies, Africa Prudential Registrars. What she preaches here is the way she directs the affairs of the board. I would like to congratulate the council for having her as your chairperson. I will approach this topic from three perspectives: one is what, two is how and three is why. This issue of sound corporate governance has become a challenge for people in the world today. We have had cases of failed companies, both in Nigeria and abroad. Following such cases of corporate failures, people have started discussing more about corporate governance. So I will start from the beginning about what exactly is this concept of corporate governance? Then, I will discuss why companies get involved in sound corporate governance practices, that is, what are the benefits? I will

181 Tony Elumelu, CON also talk about my experience in developing, implementing and using corporate governance practices to grow a business over time. There are three definitions of corporate governance, among so many, that I want to focus on today. I would like to start with the one by Mervyn King. Mervyn King chaired the King Committee on Corporate Governance, which is today called King’s Code. He simply sees corporate governance “as the system by which companies are directed and controlled”. Then there is the second definition by the Organisation for Economic Cooperation and Development (OECD), which in 1999 published its Principles of Corporate Gov- ernance. OECD describes corporate governance as “the internal means by which corporations are operated and controlled, which involve a set of relationships between a company’s management, its board, its shareholders and other stakeholders.” The third one I will share comes from your institution – the Institute of Directors. It defines corporate governance as the “framework of company processes, attitudes that add value to the business, aids its reputation and ensures its long-term continuity and success”. I like these three definitions, because they contain what I consider extremely important in many businesses today. They talk about long-term continuity and success. They talk about the set of relationships between a company’s management and its shareholders and other stakeholders. So corporate governance is not only good for managing relationships with shareholders, but it is also good for creating the outcome of a long-term company. So if we know all this, then

182 Africa Speaks: A Collection of Speeches it helps us in setting up, shaping or defining our framework of practices. So the point therefore is, why do companies even bother to raise good corporate governance standards and also practice them? There are various reasons. There is the corporate reputation issue. It helps you to enhance your corporate reputation when governed as an institution. It helps transparency and accountability. It helps long-term continuity and success of business, and of course it helps to attract and retain good customers and workers. It helps to attract capital. So if you have a company that is well run on the principles of sound corporate governance, investors pay a premium to invest and become part of this company – that is a clear benefit. I have explained what the concept is about and why institutions should bother about it. How do you now go about it if you have decided that you want to run a company the right way? I would like to share some theoretical approaches and more importantly how I applied it. The first thing in trying to run a company well is to have a charter, similar to the constitution – something you call a corporate governance code, that is, the principles and rules that govern and guide. There are key elements you need to factor in. First, you need to understand the rules of the country where you are operating in. In Nigeria, you need to understand what the constitution says about the guiding principles for businesses. Same thing applies in Ghana. You cannot put in place an internal governance code that is at variance with what the country says. Second thing, you need to look at the article and mem- orandum of association of the company. Does it allow you to put in place some of the policies you would like to? Third

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If I submit myself to such level of accountability, people who work under me cannot do otherwise. Sound corporate governance entails that the top must practice what it preaches.

thing is sector regulations, which depends on the sector you are operating in. For instance, in the health sector, there might be NAFDAC rules, in banking, there is the CBN, in insurance there might be NICON and in investment banking and in the capital market, there is SEC. Then there is the global best practice because the world we live in today is a globalised world. What is good for people in country A should be good for everyone everywhere. So you can look at all these and update your corporate values, whether written or unwritten. It is a good starting point for the journey in corporate governance to have your own internal corporate governance charter, approved by the board. Then you know that you have a framework that you can use to sanction your corporate governance. It is also good to induct board members because corporate governance starts right at the top. Corporate governance does not start at the bottom. All of us at the top must understand, practice and reinforce it at every single opportunity we have, so the management and everyone else would understand what the code is. It is not just enough to have the best policy. Develop the policy but more importantly, practise what you have devel-

184 Africa Speaks: A Collection of Speeches oped. Ensure that you have a code of assessment and moni- toring mechanism to ensure that your corporate governance code is put in place and that the rules to control businesses are actually being complied with. Then you need to allow the policies to work, so you are not putting in policies for just some people, but for everybody. For instance, Transcorp Hotel is one of our subsidiaries and we have some policies that guide the way we operate. I visit Abuja almost every week or two and I stay at the Hilton. I have never stayed at the hotel without paying, because I must live by example. If they have to give corporate discounts, they give to us when we go. If I submit myself to such level of accountability, people who work under me cannot do otherwise. Sound corporate governance entails that the top must practice what it preaches. We need to appoint CEOs that are good and this is a core function of the board and key pillar of sound governance principles in an organisation. When you have a good CEO, corporate governance principles will be adhered to. If you have a good board and everyone abides by the policies, then you will have a good CEO in your organisation. I have always said in my assessment of CEOs before board members that if the CEO is doing the right thing, commend the CEO. If the CEO is not, instigate zero tolerance for noncompliance. We do not want a situation where we keep changing CEOs. Where we have CEOs that are compliant, it is good for success. No organisation wants to start changing CEOs every time, even though the board has authority to do so. It is good to select the right CEO, who is able to create value in terms of profitability, and understands, enforces and

185 Tony Elumelu, CON complies with the rules of the organisation. So it is not just good enough to have a CEO that is strong in only one area, for instance, a CEO who is not strong in bringing business to the table. I would rather have someone who on a scale of one to ten will produce six over ten in turning a profit, yet highly compliant than appoint someone who will rate nine over ten in turning a profit, yet not compliant. In the long run, the non-compliant performer will destroy value for the entity in comparison to the one who abides by the rules of the organisation, who will definitely create long-term value for shareholders. And by the way, we must also remember that this business of building strong institutions with good corporate standards is a long-term thing. There should be zero tolerance for contravention. Compliance can be very costly, but the benefits can also be significant. It is good to create internal awareness. If your company has a corporate governance code, from time to time, review and find rules that are obsolete and remove them. Whatever you do to that document, have a means of internal awareness that is circulars. Have a corporate governance committee, discuss issues and make sure it cascades over the system, and there will be strict enforcement. A company should have a strong company secretariat with a good company secretary to ensure that the commitment to the corporate governance code is strong. It is important to have good company secretaries to let companies know when they are derailing and then report to the board to deliberate and take further action appropriately. I want to share our experience at Transcorp. When we took over in 2011, it had not published an annual report in years and had different sanctions from SEC. I recall the

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One of the areas we have not done so well as Africans so to speak is that we have not been able to grow our businesses to outlive us.

first week we had a session. The shareholding structure, the ownership of Transcorp was not even there, and we recon- ciled about thirty-five million shares once we restructured ownership of the company. We had ninety-nine court cases. And of course, Transcorp had never paid dividends before and market capitalisation then was like N11 billion. So what did we do? It was all the things I talked about. First, I decided that we ought to create internal awareness and have a change management programme. One of the reasons change programmes succeed is because you have sufficient internal mobilisation and you let people know when something is seriously not acceptable. So you galva- nise internal mobilisation and involve all the stakeholders in the change process. We had internal sessions and at our board meetings, we decided to turnaround Transcorp on the path of sound corporate governance. We had meetings with the Nigerian Stock Exchange. I recall meeting the president of the Nigerian Stock Exchange and we invited his team to come and talk to us about compliance since Transcorp, as a company, was not compliant with their regulations. We also invited SEC. The Director of Operations of SEC came and we had a weekend session. They talked to us about corporate governance, and what to expect from a

187 Tony Elumelu, CON public limited liability company – a listed company. So it was clear and we made a resolution that we needed to position the company in a different way. And that was the first thing we did. Our internal mobilisation of people was also very good, and it helped us, till date. To our satisfaction and pride, the NSE named Transcorp the most compliant company on the Nigerian Stock Ex- change in 2014. This was in just two years – 2011 to 2013. We transformed from a company that was sanctioned to one rated as the best because of compliance. This was possible because we created internal awareness and internal cohe- sion and that was how we achieved it. So, to others who are trying to do the same, do not be discouraged, you too can work and run a company that is globally accepted in terms of compliance. The next thing we did was to prepare proper corporate governance code and put a document in place. We did this, approved it and then we started the journey. Today, we are better for it. We have serious zero tolerance for noncompliance from my level to everybody. When you hear people say organisations walk their talk, then it means they say something and they do it. Actions are easier to emulate than talk, so it is important that in corporate governance, you lead from the top and not the bottom. It was the same experience at United Bank for Africa (UBA). What we did and continue to do is improve corporate governance. I say to people that sound corporate governance is a long-term journey, not a short-term thing. So you need to keep improving. You cannot stop one day, and say I have attained the highest level of corporate governance. No, you have to keep improving as things keep changing and keep learning.

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At UBA, a lot has happened and the market has continued to reward us. UBA Africa continues to enjoy from that style of corporate governance as we operate in nineteen countries. It is on record that when the United States gave licenses to African banks to operate in the country, the only African bank that remains and continues to operate in the US is United Bank for Africa. This is for two reasons. One, we knew we would be able to withstand the heightened regulatory practices in a new environment and also because we have been able to key into the fact that we believe in the robust governance system that we practice at UBA globally. Corporate governance is an on-going conversation, and it is evolving in the world. I would like to say Nigeria is not doing badly but we can do better and I would like to say organisations like the IoD are doing a good job. The CBN, PENCOM are all doing a great job. So I would like to add a few comments and parting shots. One is that corporate governance should not just be limited to businesses. NGOs should practice corporate governance. We see what’s going on at FIFA. FIFA is not a business organisation, so they felt they could operate the way they wished, but we live in a different world today. We live

Remember, corporate governance starts from the top. It is everyone’s business and not just the business of the junior staff. In fact, it is more of a concern for senior people.

189 Tony Elumelu, CON in an interdependent and interrelated world – a world where there is insistence on corporate governance standards. So it is not just enough to look at businesses to adopt strong corporate governance, we also need to look at non-businesses and organisations that are accountable to the public. Two, all businesses should develop corporate governance codes and meticulously implement them, practice them and have zero tolerance for contravention by any persons. Three, corporate governance practitioners should not leave the business of state governance to only politicians. Corporate governance practitioners should begin to show interest in national politics and national affairs, because what is good for the corporations is good for the people. And we have seen that there is a direct correlation between sound corporate governance practices and economic development and progress. So we have to begin to deliberately encourage and inject into our public life, people who have held themselves to the highest level of accountability of corporate governance in private institutions. Four, I have argued that there are certain practices that the corporate world should learn from developed countries on corporate governance. One of the areas we have not done so well as Africans so to speak is that we have not been able to grow our businesses to outlive us. We have not succeeded in being able to grow our businesses to live forever. That is the difference between General Electric and a local company here. General Electric has decades of experience, we know their history. Longevity helps in the long run to build iconic national and international global institutions. We need to have a strong foundation for sound corporate governance practices and that is why I keep saying that in creating aware-

190 Africa Speaks: A Collection of Speeches ness about corporate governance, we need to continue to propagate and create awareness, and partner with similar minded organisations to make this. It is a strong pillar for building our organisations to last. We should not make mockery of governance. I cannot stop making emphasis on practice, practice, practice. You determine how you want to run your business. So we need to make sure that what we have embraced as our policies, corporate governance policies to guide us as we implement and practice them. Again as I said before, sound corporate governance is a journey and not necessarily a destination. We need to keep improving so we do not just rest on our oars. When we talk about corporate governance, people think it is limited to just listed companies on the stock exchange. One- man businesses should also have some set of rules about how they want to govern their businesses and that has some advantages, including succession. Despite the fact that it is a one-man business, a key concept is succession and when you have sound corporate governance practices, succession to a large extent is addressed. The ultimate ambition of small businesses is to take a business, start small and make it public. So if you have a small business and an ambition, then you need to begin to embrace and put some corporate governance policies in place and practice them. It helps you to prepare your company attract private capital and public capital to your business. Remember, corporate governance starts from the top. It is everyone’s business and not just the business of the junior staff. In fact, it is more of a concern for senior people. To end, I would like to draw the attention of everyone here to the Federal Reporting Council of Nigeria (FRCN).

191 Tony Elumelu, CON

I believe that organisation is doing a fantastic job, and they have come up with a compendium and new ideas of corporate governance practices in Nigeria. They have recently released a special draft on how companies should be governed in the country and also for NGOs. I would like to urge everyone who is interested in sound corporate governance in public and private companies and also in NGOs to find time to read this and do make your comments known to them so that together, we can have a document. Right now, we have different policies for different regulatory bodies so what they want to do are to bring everything together in one place. If they succeed, we will have national governance code that we can all refer to along the way. If you have not seen it, try to reach out for it. I believe IoD has done a seminar on it. Ladies and gentlemen, let me end by thanking IoD for this opportunity to share a few thoughts and comments on the benefits of sound corporate governance and to recommend it to everyone, both people in businesses and NGOs. I would also say that SMEs that are not listed are not excluded from this. You need to prepare your company for the future and for the capital market. We need to build Nigerian companies to last; we need to have iconic institutions that will become future General Electric out of Nigeria, out of Afri- ca. That should be our collective aspiration, and we need to have sound corporate governance for this to work. Thank you very much.

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A Continent Connecting: Solutions from Within

Speech delivered at Columbia University’s Africa Economic Forum in New York, themed, Impact of Africapitalism 02 April 2016

193 Tony Elumelu, CON

The African development agenda should not just be about fighting poverty. It should be driven by strategies that centre around building capacity and unleashing the potential of hundreds of millions of marginalised Africans.

– Tony Elumelu, CON

194 want to thank Professor Murray Low of the Columbia Business School, my brother, Austin Okere, and the Iteam of organisers of this conference for this kind invitation to speak with you today. I believe the economic agenda for Africa should be nothing short of a total economic transformation. I particularly like the topic of this year’s conference, examining “solutions from within” because I am also a firm believer – and history attests to this – that only those with a stake and a vested interest improve things. In that context, nobody but Africans can develop the continent, because no one has a bigger stake than Africans in the development and modernisation of Africa. To borrow a quote from President Thabo Mbeki, we must find “African solutions to African problems”. Africa’s single biggest challenge is untapped human potential, and a great deal of that potential exists among the poorest, the unemployed and the young. World Bank data shows that while poverty in Africa has dropped from 56 per cent in 1990 to 43 per cent in 2012, the number of people living in extreme poverty has actually grown by one hundred million to three hundred and thirty million. Also, Afri- ca also has a young and fast growing population, compared to other world regions. This could prove to be an economic advantage, but only if we can create ten million jobs a year for the two hundred million young people who will need

195 Tony Elumelu, CON employment by 2030 when Africa will be home to the largest population of working-age adults in the world. Therefore, the African development agenda should not only be about fighting poverty. Rather, it should be driven by strategies that centre on building capacity and unleashing the potential of hundreds of millions of marginalised Afri- cans – the continent’s greatest and most abundant natural resource. This modern African development agenda should be about creating jobs, unlocking entrepreneurial opportunity, spreading prosperity and launching the continent as a significant player in an industrialised global economy, as opposed to one that operates on the periphery. My belief in the limitless value found in Africans’ inherent ingenuity and dedication to hard work drives both my commercial and philanthropic investments. I think this new attitude to development deserves its own approach. I call this new approach to Africa’s development, Africapital- ism. Africapitalism asserts that the private sector has a leading role to play in the development of Africa. A role it must recognise and embrace. Specifically, Africapitalism promotes long-term investments in strategic sectors that deliver economic dividends for shareholders and social dividends for society. Africapitalism is needed because even though Afri- cans are connected by geography and cultural identity, we will make more progress if African governments and businesses are also connected by a shared philosophy, common principles and coordinated objectives for trade and investment promotion. This will deliver the prosperity we seek. Essentially, Africapitalism requires “shared purpose”. I am going to tell you my story and how I came to cre-

196 Africa Speaks: A Collection of Speeches ate the economic philosophy of “Africapitalism”. In 1997, my partners and I took over a shuttered and insolvent bank called Chrystal Bank, rebranded it to Standard Trust Bank (STB) and started the process of engineering a turnaround. We were a small bank, but smart enough to harness modern technologies such as the Internet and smartphone technology, to serve our customers. The result was we out-performed most of the other larger banks in Nigeria. We achieved unprecedented growth through innovation by pursuing customers who had hitherto been denied access to banking services. This opened up access to credit for tens of thousands of financially marginalised Nigerians. I call this the democ- ratisation of the banking sector. This is when I began to understand the value and impact that can be made when a business seeks meaningful social returns in the pursuit of profit. The success of STB emboldened us to execute a merger with one of the top three banks in Nigeria – the United Bank for Africa (UBA) in 2005. However, our next objective was to ensure that the bank lived up to its name by actually becoming a pan-Afri- can financial institution. So we began to establish banking operations in other countries, believing that, if given the opportunity, Africans would choose to save. We even allowed customers to open bank accounts with a zero balance. This strategic calculation to be patient and promote financial inclusion paid off. Today UBA employs over fifteen thousand people and serves nine million customers in nineteen countries. It also operates from offices in London, Paris and right here in New York. That is Africapitalism. And it works. Over the last two days you have focused on identifying and scaling innovative solutions as a way to accelerate the

197 Tony Elumelu, CON pace of development in Africa. Many of your discussions have no doubt centred on ways in which technology can facilitate this across the continent, essentially allowing Africa to leapfrog outmoded and less efficient ways of doing things to a more efficient method more applicable to the African context. Some examples include: Mobile telephony: sub-Saharan Africa went from having only for a few million landlines, outside of South Afri- ca, in the 1990s to over seven hundred and twenty million GSM phones today – the fastest rate of mobile telephony adoption anywhere in the world. Mobile money: telecom companies like Safaricom in Kenya have used smart phones technology to pioneer mobile money (MPESA), enabling the poor and rural Kenyans to efficiently and securely pay bills, transfer money to family and friends, and conduct business electronically. Basically, enabling them to participate in the formal national economy. Mobile money solutions are now becoming more prevalent in other parts of the world. M-Pedigree: another mobile application, which is used to verify the authenticity of drugs on the market to increase patient safety in response to the proliferation of counterfeit medications that harm consumers. However, as important as technological innovation has become to Africa and every other region of the world, the continent still has many basic needs in the areas of commerce and trade, governance, and social and community development that cannot be skipped. These are represented among the key characteristics of Africapitalism and I will highlight three of them as they relate to today’s theme. They are regional integration and strategic specialisation, local val-

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Africa also has a young and fast growing population, compared to other world regions. This could prove to be an economic advantage, but only if we can create ten million jobs a year for the two hundred million young people who will need employment by 2030.

ue addition, entrepreneurship and regional integration, and strategic specialisation. We all know the stats. Africa represents less than 4 per cent of global trade, and intra-Africa trade is 12 per cent compared to the European Union where 60 per cent of trade is intra EU trade. This is way low, leaving Africa as the least economically integrated region in the world. This is largely due the absence of the lack of physical infrastructure needed to connect Africa, although African governments have not helped matters either as some policies and practices hinder rather than encourage regional trade. But integration is not enough. We need “strategic specialisation” as well. Africa has too many small and isolated markets. This fragmentation limits the scope for economies of scale. Therefore, African countries should explore specialisation as a means to maximise economic growth. While there is a long way to go, there has been progress in regional integration and strategic specialisation. Flight connectivity has improved substantially in Africa. Only ten years ago, one had go to Paris from Lagos to get a connecting

199 Tony Elumelu, CON flight to Casablanca or Dakar. It is not perfect by any means, but there are more flights and hubs on the continent and this means more business can be done more efficiently, which means more integration. Specific businesses like UBA, which I have already talked about, is an example of regional integration because it facilitates cross-border transactions and financing in nineteen countries. Several other Nigerian banks such as Zenith, First and Access Banks have also expanded regionally, making financial services a specialisation of the country. Additionally, the expansion of South African manufacturers and retail businesses such as Shoprite, Spar and Tiger Brands make them the dominant players in the fast moving consumer goods sector as their growth accelerates across the continent. In East Africa, Kenya is already a leading country in ICT innovation, and Rwanda is investing in fibre-optic networks to become a knowledge economy in the future. Ethiopia is also investing beyond its capacity needs for electricity to supply its neighbours. When we increase integration, it promotes specialisation. And if that specialisation is not tied to natural resources, it improves quality, competive- ness and economic resilience and that is very attractive to investors and buyers from the continent and beyond. The second characteristic of Africapitalism that is key to achieving internally generated solutions is “local value addition”. Africa has lost billions and billions of dollars over decades to the low cost export of raw materials that is sadly followed by the importation of related finished goods. For example, we export crude and import petroleum products; export timber and import furniture; export cocoa, only to reimport it as chocolate, and so on. This is costing us mil-

200 Africa Speaks: A Collection of Speeches lions of jobs and billions of dollars in revenue that we could be investing in our own economies. However, there are ob- servable changes afoot in reclaiming the value chain. To sum up, these companies are Africans companies that they are increasingly reclaiming control of the production of the fast moving consumer goods, which we had previously ceded to foreign entities. They are also saving billions in capital flight from the continent, which in turn can be rein- vested in our economies. They are also pioneering the mass industrialisation of Africa, a necessity for the continent to compete with other regions in the twenty-first century. We are witnessing the daily manifestation of key economic desirables including import competition, regional supply chains and self-reliance, all of which lead to more jobs and prosperity at home. In the case of entrepreneurship, to effectively fight poverty and achieve what World Bank President Kim calls “shared prosperity” – prosperity that is not confined to one sector or level of society in a country – entrepreneurship must be promoted.

Africa represents less than 4 per cent of global trade, and intra-Africa trade is 12 per cent compared to the European Union where 60 per cent of trade is intra EU trade. This is way low, leaving Africa as the least economically integrated region in the world.

201 Tony Elumelu, CON

Governments and large corporates do not have the capacity to provide employment for the tens of millions of young Africans entering the job market every year. There- fore, we must empower them to create their own livelihood and in the process create jobs for others. This means they take charge of their futures by starting their own businesses. Many of them have deep insight into their local markets, consumer needs and ideas for locally generated solutions. But they are shut out of the formal economy by bureaucratic and regulatory obstacles, policy gaps and a perennial lack of access to capital, markets and training. I believe that Africa has the potential to produce one thousand more UBAs and our own Steve Jobs through private sector investment. That is why we launched the Tony Elumelu Entrepreneurship Programme to invest $100 million over the next ten years to train, mentor and seed ten thousand African businesses. We aim to create one million new jobs and $10 billion in additional revenue for the continent by democratising and institutionalising the same “luck” that I had as a young man that me led to this moment.

If we accelerate our efforts to better integrate the continent, increasingly reclaim the value chain and make more of the things we need whilst unleashing our entrepreneurs, over the next twenty years, the stories of Africa’s plight, its dependency on foreign aid and its limitless potential will be consigned to the trash heap of history.

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Additionally, we are identifying and advocating for policy reforms to enable not just the Elumelu entrepreneurs, but also all African entrepreneurs with the will to succeed – and they are hungry for it. In its inaugural year, we received twenty thousand applications for the one thousand available slots and this year, more than forty-five thousand aspiring and budding entrepreneurs applied. When you talk about solutions from within, in the ICT sector, one of the Elumelu entrepreneurs has created an app to link all Nigerian police stations together with photos of wanted individuals, a critical gap in our security coordina- tion. Another beneficiary has created cost-effective “birthing kits” with essentials to aid midwives and birth attendants to help reduce maternal and child mortality. He is now scaling up the distribution. A third entrepreneur from Zambia is channelling her own difficult experience as a teenager into manufacturing re-useable feminine hygiene products, which has already created dozens of jobs and helping to prevent girls from missing schools; and lastly, a Ghanaian entrepreneur is now manufacturing bamboo bicycles, which is providing jobs and transportation for rural workers using sustainable materials, and I had the pleasure of riding one of those bikes during the TEEP boot camp last year. Even better, with their insight and innovations, many of these start-ups and small businesses will be taking a bottom up approach to economic and social development, utilising private sector capital and expertise. There are millions of entrepreneurs out there with millions of ideas that can help achieve the economic transformation of Africa. We have made significant progress, but we need innovative models of training, financing and legal protections to support their

203 Tony Elumelu, CON work. I believe more than anything else at this point that entrepreneurship is the key to Africa’s economic salvation and elevation. In conclusion, I want to reiterate that well-meaning outsiders cannot solve Africa’s challenges. Its economic and social transformation is the responsibility of Africans. And as the theme of this conference suggests, many of the solutions exist within the continent. There is still much to be done. But we are making progress in overcoming these challenges. If we accelerate our efforts to better integrate the continent, increasingly reclaim the value chain and make more of the things we need whilst unleashing our entrepreneurs, over the next twenty years, the stories of Africa’s plight, its dependency on foreign aid and its limitless potential will be consigned to the trash heap of history. A new story and narrative will take hold. A story more likely to be of Africans, who seized the moment, took charge of their destinies and created the future they want for the continent and its people. As students and future leaders both here and on the continent, you will have a role in helping to shape the future of the world. I charge you to work in partnership with those on the continent and seek internal solutions and innovations, particularly those generated by the private sector. I believe, and suspect, that such solutions will have the most sustainable and impactful results. Thank you.

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Achieving Success in Africa through Trade and Entrepreneurship

Speech delivered at the Harvard Development Conference at Cambridge, Massachusetts, themed, Success in Private Sector Development and Job Creation 2 April 2016

205 Tony Elumelu, CON

Unlocking jobs is also key in Africa, because Africa has a very young population.

– Tony Elumelu, CON

206 would like to thank the Harvard Centre for Public Lead- ership and the organisers of this conference for the in- Ivitation to speak to you today and talk about two issues that I am passionate about: Africa and progress. I am delighted to be in the company of my brother, Donald Kaberuka, one of Africa’s finest exports and an expert on effective development partnerships between the public and private sectors. I would also like to commend all the students, academia and development practitioners here today for your interest and dedication to improving the lives of millions who you may never meet, and likely never know your names. The overall theme of this year’s conference, “Pathways to Progress” is very appropriate because, while we all agree that development is desirable, there is much we can debate on what constitutes an effective development programme or paradigm, or what policy priority is the right fit for which region. The emphasis on “Success in Private Sector Devel- opment and Job Creation” is particularly relevant as it relates to the African continent. Only last year, global governments launched the seventeen Sustainable Development Goals, which is estimated to cost over $70 trillion over the next fifteen years. I think we can agree that no one has that kind of money, least of all governments. So, the private sector, which has the capacity to mobilise the most resources, is the best at innovation and

207 Tony Elumelu, CON renowned for expertise, must be involved in development. In fact, we must pursue private sector growth in a way that promotes and results in development outcomes and I will talk more about this a little later. First, let me talk about the prevailing development paradigm. There is not one sole path to development, particularly if poverty reduction or alleviation is to be a key objective of what we call “development”. However, the traditional approach to development has been for donors and governments to invest in basic health, education and access to food in developing countries, with the hope that the beneficiaries will eventually become self-sufficient. But I also believe that if we help people become self-sufficient, they will purchase those same basic goods and services I mentioned that governments and donors are struggling to provide. Basically, humanitarian assistance and economic opportunity are two sides of the same development coin. Yet, we tend to focus on the former at the expense of the latter, with limited results. However, over the last decade, even development agencies have learned the value of leveraging and incorporating private sector capital for economic opportunity with impressive outcomes. The US Agency for International Development (US- AID), for instance in 2008, only leveraged 8 per cent of its programming budget with private capital to support its programmes. By the end of 2013, it was leveraging 42 per cent of its budget with private capital to achieve its objectives. The result has been that US taxpayer dollars that were spent on foreign assistance spread further, allowing it to expand its focus from small interventions, like micro-enterprise and feeding programmes, to large scale capital inten-

208 Africa Speaks: A Collection of Speeches sive infrastructure programmes like power plants, regional highways and ports. This is aptly demonstrated by President Obama’s USAID-administered Power Africa Initiative to expand access to electricity in Africa for the six hundred million people living without it. By working with the public and private sector, Power Africa has been able to marshal $43 billion to create sixty million new power connections, using a mix of power solutions. My company, Heirs Holdings through its power sector vehicle, Transcorp Power, committed $2.5 billion of investment capital to the sector as a result of this initiative. So you see how the importance of this pivot cannot be overstated because to maximise and sustain development, the macro-economic conditions of the countries we seek to help matter as much as the lifesaving interventions we make in the short term. There is need to align the variety of interests, and private sector operators are key in that equation. I am so convinced of the immense value of the economic opportunity in development to create a catalytic impact on people’s lives and drive development on the African continent. This belief drives both my commercial and philanthropic investments. I call it Africapitalism, which asserts that the private sector has a role to play in development, and that the private sector must itself recognise, embrace and deliver development outcomes through long-term investments in strategic sectors that deliver economic dividends for shareholders and social dividends for society. I will borrow the great Professor Michael Porter of the Harvard Faculty’s description of strategic sectors, which are those sectors where a country has a natural competitive advantage like power. This is what leads to jobs, which matter

209 Tony Elumelu, CON to be able to achieve both significant growth in GDP and reduction in poverty. It is also what Dr Jim Kim, another ster- ling product of the Harvard Faculty, and the current World Bank President calls “shared prosperity”. Unlocking jobs is key because Africa has a young population. With the right investments in education and industry, given the rapid age- ing of populations in other regions, Africa should become the engine of global growth in the near future. However, if we do not create ten million jobs a year between now and 2030, we could face severe stability problems, and go from “demographic boom” to “demographic doom”. I believe that success in the African private sector and its development outcomes can be demonstrably observed by looking at three areas: Intra-Africa investment and the expansion of home-grown businesses, Local Value Addi- tion, Entrepreneurship and Intra-African Investments Until the recent crash in the price of commodities, seven of the top ten fastest growing economies in the world were from Africa. What is more interesting to note is the flow of financing for investment, because sustained private sector growth requires investment. In 1990, Africa received $26 billion in Overseas Development Assistance (ODA) and $1 billion in Foreign Direct investment (FDI). In 2013, ODA received by Africa was $56 billion and FDI was $57 billion. In twenty years, FDI has managed to overtake ODA. However, even more significant is the growth of intra-Af- rican investments, which was negligible in 1990 and had grown to over $70 billion in 2013. Let us examine the effect in two businesses operating in two strategic sectors. In the telecoms sector, prior to 2000, only a few million Africans had access to telephone lines for

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There is not one sole path to development, particularly if poverty reduction or alleviation is to be a key objective of what we call “development”.

communication. Today, over seven hundred and twenty million GSM lines exist, effectively democratising communication on the continent. MTN, the South African telecoms giant, expanded to Nigeria in the early millennium years and, with well over one hundred million users, the Nigerian market generated enough profit and capital to enable MTN expand to over a dozen more countries. It now operates in seventeen African countries. This is significant. MTN substantially contributed to economic growth through direct and indirect employment, and enabling communications with customers and markets. Similarly, in the financial services sector, the United Bank for Africa (UBA), which I chair, expanded from a domestic bank in 2005, and now employs over twenty thousand people, serving close to twelve million customers and businesses in nineteen African countries. UBA enables more Af- ricans to save, provides capital for businesses to grow, and drives large scale intra-African trade and investment. More importantly, UBA is the top home-grown lender in the Af- rican energy sector, a strategic sector that will unlock more economic growth and jobs that we need. That is private sector growth, and that is development. The second area where private sector growth is vital to

211 Tony Elumelu, CON development is Local Value Addition, a key characteristic of Africapitalism. It is hard to estimate how much capital the continent of Africa has lost over decades to the low cost export of raw materials that is sadly followed by importation of related finished goods. The loss is huge and it’s in billions of dollars. For example, we export crude and import petroleum products – my country Nigeria being the worst culprit; export timber and import furniture; export cocoa, only to reimport it as chocolate, and so on. This is costing us millions of jobs and billions of dollars in revenue that we could otherwise be applying to the SDGs. It has also created Africans’ dependency on compas- sionate capital, when we are more than capable of generating much of that capital ourselves. However, there are ob- servable changes afoot in reclaiming the value chain of some of our consumer products, but we need to do more. Such efforts will save billions in capital flight from the continent and pioneer the mass industrialisation of Africa, a necessity for the continent to compete with other regions in the twenty-first century. We are witnessing the daily manifestation of key economic outcomes, including import substitution, higher regional supply chains and self-reliance – that is private sector growth and that is development. In the case of entrepreneurship, this is not a well-developed area, so I will discuss it in the context of advocating for more deliberate action and investment, on the part of both the public and private sector actors. To ensure shared prosperity in African economic development and opportunity, we cannot simply focus on the growth of large corporates, such as those I have just described.

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Governments and large corporations do not have the capacity to provide employment for the millions of young Africans entering the job market every year. Therefore, we must empower youths on the continent to create their own jobs, and take charge of their future by starting their own businesses. Many of them are so talented and merely need a chance to take off. They are designing apparel and apps, educational models and agriculture supply chains. But they are shut out of the formal economy by bureaucratic and regulatory obstacles, policy gaps and lack of access to capital, markets and training. I believe that Africa has the potential to produce one thousand more UBAs more MTNs, and even our own Steve Jobs through private sector investment. That is why the Tony Elumelu Foundation launched the Tony Elumelu Entrepreneurship Programme, which has committed $100 million over the next ten years, to train, mentor and seed ten thousand African businesses. We aim to create one million new jobs and $10 billion in additional revenue for the continent, by democratising and institutionalising the “luck” that I experienced as a young African – the same luck that led me to this moment. Additionally, we are identifying and advocating for policy reforms to enable not just the Elumelu entrepreneurs, but also all African entrepreneurs with the will to succeed. And they are hungry for it. In its inaugural year, we received twenty thousand applications for the one thousand available slots, and this year, in our second cycle, more than forty-five thousand aspiring and budding entrepreneurs applied. I must add that this entrepreneurial zeal is not unique to Africa. President Obama’s Administration has made a lot of effort to promote entre-

213 Tony Elumelu, CON preneurship, in partnership with the private sector, through Spark – The US Global Entrepreneurship programme. We have the shared belief that we must step up our investments in supporting small businesses, because they will generate the greatest growth in any region, and employ the most people. Even better, with the insight they have into gaps in the local markets, and their constant innovation, many of these startups and small businesses will be addressing key development challenges, which constitute a bottom up approach to implementing the SDGs, using private sector capital and expertise. Importantly, by channelling the ideas and energies of our huge population into virtuous and productive pursuits, they will help to strengthen global security. In conclusion, not all roads and good intentions lead to development. We have seen this with many of the disastrous aid policies of the 1960s and 1970s, which cultivated decades of debt and dictatorships in developing countries. And even as I have endorsed today’s theme, I would like to submit that development is not so much a destination but an unfolding journey, and the destination is not as important as those we carry along with us. For too long, governments have tried to go it alone. We are all travellers on the development journey, and we need to bring along governments, the private sector, academia, civil society, and most especially, the poorest and most vulnerable among us along this path to success and progress. I will finish by saying that I am honoured to travel with you. Thank you.

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Shared Purpose in Developing Agriculture in Africa

Speech delivered at The Chicago Council on International Affairs Agriculture Symposium at Washington D.C., themed, Growing Food and Growing Entrepreneurs: The Fuel for Africa’s Future 26 April 2016

215 Tony Elumelu, CON

If the public and private sector work together in shared purpose, we will be able to retain the knowledge and manpower needed in rural areas to support agriculture, and control the rate of urbanisation.

– Tony Elumelu, CON

216 o-Chairs of the Chicago Council, Dan Glickman and Doug Bereuter; my dear friend, Dr Rajiv Shah, Cdistinguished policy makers, technocrats, investors, researchers, journalists, academia, civil society and students; ladies and gentlemen. I am the Chairman of Heirs Holdings, an African investment company, which invests long-term in key strategic sectors across Africa. I am also the founder of the Tony Elu- melu Foundation. It is a pleasure to be with you this morning. I want to thank my friend, Dan Glickman, for this kind invitation to speak to you today. I also want to thank my good friend Dr Rajiv Shah for his kind introduction and for his outstanding leadership at USAID promoting global food security. Permit me also to thank the United States Government and the Chicago Council for their continuous leadership in matters of food security and emergency food assistance. I congratulate the Council on the release of its 2016 Global Food Security Report, “Growing Food for Growing Cities: Transforming Food Systems in an Urbanizing World”, which will be of immense value in formulating policies and plans to address how best to feed the new world demographic. Today, I will speak about the importance of the public and private sector collaboration in development and, specifically, in advancing agriculture and food security; the need for crosscutting investments in related-sectors; the impor-

217 Tony Elumelu, CON tant role of entrepreneurship in promoting food security; and the importance of reforming the US food aid regime. I will start on a blunt note. The global food security paradox is a sad story to tell. On the one hand there is more than enough food to feed the world’s seven billion inhabitants. We hear of global surpluses of mountains of grain, pyr- amids of meat, and rivers of milk in some world regions. On the other hand, many beg and hope for their next meal. The other sad paradox is that my continent, Africa, which holds 60 per cent of the world’s uncultivated arable land, is home to the largest population of the chronically hungry and, in some years, starving people. And we are a net importer of food. Obviously, my remarks will focus on this region and what in my view can be done to address this situation. This year’s theme is an extremely relevant topic to discuss. As the Chicago Council’s report states, by 2050, the world’s population will be nine billion and 66 per cent of this population will live in cities. So, we need to plan now to feed the future population. In Africa, the rate of migration from rural areas to the cities is happening at a rapid pace. This is an undesirable phenomenon because farming remains – for all the progress made with mechanisation – a labour intensive endeavour and when young people leave the rural areas, manpower is lost. Also lost is the transfer of skill in crop cultivation and animal husbandry, which will cumulatively have negative consequences on food supply and cost in a country. To effectively tackle this problem, we need to ask ourselves why this is happening. The answer is simple. People move in search of what they consider to be better opportunities elsewhere, and jobs.

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I believe that the high rate of urban migration in Afri- ca, particularly among young people, is largely because the rural economy, which is predominantly agrarian, has been stagnant. Africa has a comparatively young population and needs to create millions of jobs a year for the ten million young men and women who will enter the workforce each year between now and 2030. If that challenge is met, Africa can become the engine of global economic growth for years to come. If not, we risk mass unemployment, political and economic instability – in essence this demographic boom could easily spell doom. While the high rate of rural urban migration in African has become a socio-economic, security and environmental concern, it is important to understand that these young people are not fleeing from farming as an occupation; they are fleeing from poverty. The two have become conflated because farming seems to have failed an entire generation. Most young people have grown up watching their parents labour for a lifetime as subsistence farmers, only to remain desperately poor. African farmers mostly subsist on one growing season and realise one-fifth of what US farmers would harvest from the same hectare of land. To borrow a business term, we need to turnaround this sector now. The good news is we can do this, and I will show you how later on, when I discuss the Tony Elumelu Entrepreneurship Programme. This is an example of how excited young people can get about agriculture when they have the tools and are presented with opportunities that facilitate success. I am an advocate of the philosophy of Africapitalism, which asserts that the private sector must acknowledge and

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In Africa, the rate of migration from rural areas to the cities is happening at a rapid pace. This is an undesirable phenomenon because farming remains – for all the progress made with mechanisation – a labour-intensive endeavour and when young people leave the rural areas, manpower is lost.

embrace its role in advancing development, particularly in Africa. Africapitalism promotes long-term investments in strategic sectors, which unlock both economic and social dividends. Agriculture is arguably the most strategic sector on the continent because virtually every country has a comparative advantage in one crop or another. It delivers two to three times the return of investment, in terms of improved economic wellbeing, as other sectors. Agriculture also represents 32 per cent of Africa’s GDP and employs 65 per cent of the working population. Most importantly, it is the sector where the poorest on the continent are most likely to be engaged in their struggle to survive. Unlike in Western societies, Africa’s farmers are among its poorest citizens. What this tells us is that to succeed with any programme or initiative aimed at eradicating or alleviating poverty or stimulating job creation or facilitating gender empowerment, we must tackle the agriculture sector. Basi- cally, I believe that if we transform the agriculture sector, we will transform the African continent.

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To achieve this, African governments (and donors) need to treat the agriculture sector in Africa not as a social welfare programme, but a commercially viable sector with the potential to create millions of jobs and billions of dollars in revenues. Train African farmers to see themselves as entrepreneurs whose business can grow within a value chain and develop a self-sustaining ecosystem. Create an enabling environment for MSMEs to access finance and infrastructure that supports their value chain from farm to table. On the private sector side, we need to come in with large investments that promote mechanised farming and processing; and capital to partner with the government to provide key infrastructure supportive of sustained growth in the agriculture sector. This brings us to the critical nexus among the strategic sectors of agriculture, transportation and power. It is vital to address this because sectors do not succeed in isolation. They are interdependent on each other. For example, in order to boost the agriculture sector, we need collaborative effort and investments in roads to facilitate the transportation of produce and finished goods from rural areas to industrial areas and urban markets. We also need investments in energy to provide the megawatts needed for processing and preservation, particularly the cold rooms needed and demanded by urban consumers. And of course we need financing to underpin all of these infrastructural needs. We know that African governments do not have enough capital to deliver on these infrastructural needs alone. The private sector, however, has and can access the capital, expertise and discipline to help meet these needs. Af- ricapitalism provides a solution. Africapitalism requires governments and the private

221 Tony Elumelu, CON sector to work in “shared purpose”, what Dr Jim Kim, Pres- ident of the World Bank, calls “shared prosperity”, that is GDP growth must permeate multiple sectors and levels of society. Shared purpose is critical to achieving economic growth and development objectives. The good news is African governments are starting to understand this and are working with the private sector to construct roads that open up rural and remote areas to move products to local markets, and connect countries to take advantage of larger regional markets. For example, between 2010 and 2014, the African Development Bank partnered with governments and the private sector to finance the construction and rehabilitation of 230,000 kilometres of feeder roads, enabling five hundred and sixty-three thousand people to benefit from improved access to transport. Govern- ments are also beginning to understand the critical value of power as a cross cutting sector, without which development gains will be limited. President Obama’s much-lauded Power Africa In- itiative is boldly tackling the challenge of expanding access to electricity that will unlock opportunity and growth across countless other sectors and innumerable businesses. Through Power Africa, the US government and private sector have engaged one hundred and twenty public and private sector partners, and marshalled $43 billion to create 60 million new power connections. My company has been part of this process. Through Transcorp Power, Heirs Holdings made a $2.5 billion commitment to deliver 2,000MW under Power Africa. Transcorp is a key player in the Nigerian energy market and currently generates about 19 per cent of Ni- geria’s power. When investors respond to government com-

222 Africa Speaks: A Collection of Speeches mitments and step up to partner with them, that is shared purpose – that is Africapitalism. Another example I would like to cite is in response to the AU’s Maputo Declaration of 2003, where African governments committed to spend 10 per cent of their national budgets on agricultural development, the United Bank of Africa (UBA) Group, which I chair and which operates in nineteen countries across Africa, improved its risk assessment and understanding of the sector, which is now regarded as a leading lender in the agriculture sector. Last year, we were recognised as the top lender in Nigeria among peer banks, lending almost twice as much as our competitors in this sector. When financial institutions recognise government priorities and deliver capital to amplify their efforts that is shared purpose – that is Africapitalism. If the public and private sector work together in shared purpose, we will be able to retain the knowledge and manpower needed in rural areas to support agriculture, and control the rate of urbanisation. This is because we will have made it possible for our young people to earn a good living and grow their businesses right where they were born and raised, as agro-allied entrepreneurs. To illustrate this point, I am going to tell you about some such entrepreneurs on the Tony Elumelu Foundation’s Tony Elumelu Entrepreneur- ship Programme (TEEP). TEEP is a $100 million commitment to identify, train, mentor and provide seed capital to ten thousand African entrepreneurs over the next ten years, towards creating one million jobs and $10 billion in additional revenue across the continent. While the programme is sector agnostic, agriculture represents over 30 per cent of the sixty-five thousand

223 Tony Elumelu, CON applications we received for 2015 and 2016 session. That means 30 per cent of the best two thousand ideas selected to benefit from this merit-based programme were agro based. What this tells you is that Africa’s entrepreneurs have not given up on agriculture. They see it as a sector full of opportunities that will bring them wealth. And they have innovative, scalable and transformative business ideas for this sector. We surveyed these agro-entrepreneurs across the continent and learned that they are employing sophisticated marketing strategies and technological tools and management systems. Owing to the challenges they face, they have designed and built their businesses to include integrated value-adding supply chains, from production, processing, distribution, and marketing, to create high quality products that can compete with foreign imports. They are creating jobs per entrepreneur in just the start-up phase, and nearly half of them live in and serve urban areas, but over 60 per cent of them source from rural areas. In other words, they are the “missing middle” identified in the Council’s report – the bridge between farming entrepreneurs and urban consumers. They are also developing the supply chain for the emerging urban African middle class that has disposable income and whose nutritional preference includes fresh fruits and vegetables, meat and dairy. They, and others like them, are stepping up to meet the nutrition demands of growing cities while developing the productivity component and supply chain for their rural partners. And between their innovations and access to finance from TEEP, they are overcoming the constraints of the weak enabling environment for business. These entrepreneurs and others

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Through Power Africa, the US government and private sector have engaged one hundred and twenty public and private sector partners, and marshalled $43 billion to create 60 million new power connections.

like them in other sectors are going to make a world of difference in Africa. They are going to fuel Africa’s economic future. Of all my investments over a twenty-year career, I believe these entrepreneurs will prove to be the best investment I have made. To wrap up my remarks about the impact of urbanisation, public private sector collaboration and entrepreneurship on food security in Africa, I want to say that I believe that agriculture is an inherently viable sector because people must eat. Prioritising and transforming this sector in Africa is not just a moral imperative, it is a smart business strategy that will save lives, unlock jobs, grow economies and stabi- lise regions. Investing in Agriculture not only gives us the ability to achieve SDG2 of “Ending Hunger”, it also has the ability to help achieve other SDGs such as good health, economic growth and infrastructure, thereby transforming the continent. Everyone has a role to play, and we must work in “shared purpose”. I started by recognising US global leadership on matters relating to hunger and food security and I want to finish there, albeit digressing to discuss emergency food aid because it is an important debate in US foreign policy circles.

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When it comes to foreign assistance, there is no match for the decades of generosity of the American people. I want to urge you to ensure that the US provides the most effective kind of help. Through the Farm Bill, every year, the US provides over $1 billion in food aid globally. This is a life-saving policy. What is missing from this policy, laid out in the 1960s, is flexibility. Food will need to be shipped to some places where there is no other option, but in other cases, food is available in the affected region that can be bought more cheaply and delivered faster without distorting local markets. No matter how hard they try, local farmers cannot compete with free food and I know that no American wants to save lives while impoverishing local and regional farmers. Therefore, it is time to give the Administrator of USAID the maximum flexibility to provide the best assistance in any given food crises. The food aid set-aside is but a drop in the ocean of US agricultural output. Such a policy change would be too small to be felt by American farmers and with adequate notice of five years US shippers can plan to focus more on trade routes rather than humanitarian emergencies. Policy-making is not for the faint hearted, it requires knowledge and it requires courage. We know that flexibility is the right way to do food aid that will save more lives. As an African, I want to appeal to the US Congress and the next president of the United States to make the correct and courageous decision in the next re-authorisation of the Farm Bill to fight famine with flexibility, and I am appealing to all of you here to make sure that they do it. Thank you.

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Attracting the Private Sector to the Medical Sector

Speech delivered at the 20th National Annual General Meeting and Scientific Conference of the Guild of Medical Directors, Nigeria, themed, Unlocking Private Sector Potential to Establish World-Class Hospitals and Diagnostic Centres in Nigeria

227 Tony Elumelu, CON

A significant investment required to unlock the health sector in Nigeria, will come from the private sector.

– Tony Elumelu, CON

228 thank the esteemed members of the Guild of Medical Directors for inviting me to your Annual General Meet- Iing. The tagline of the guild is apt and needed in today’s reality. We need collective effort to advance the provision of quality private medication clinics and hospitals in Nigeria. The rapidly declining state of the healthcare sector requires action from you to restore the faith and trust that people should have in the sector that literally determines life and death. Currently, budgetary allocation and per capita government expenditure on healthcare has also remained low when compared with per capita government expenditure in more developed countries. In recent times, the healthcare budgetary allocation has increased but these allocations are still grossly inadequate compared to World Health Organisa- tion’s (WHO) recommendation that 11 per cent of a country’s budget should be dedicated to its healthcare sector. In Nigeria, the health budget accounted for 6.07 per cent of the 2012 budget. The declining state is followed by declining confidence, which has led to the increase in medical tourism. Studies have shown that at least three thousand Nigerians travel each month to India for medical treatment and spend close to $200 million (N30 billion) annually. This is equivalent to about 20 per cent of the budgetary allocation for Nigeria’s healthcare sector in 2010. This goes to show

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The declining state is followed by declining confidence, which has led to the increase in medical tourism. Studies have shown that at least three thousand Nigerians travel each month to India for medical treatment and spend close to $200 million (N30 billion) annually. This is equivalent to about 20 per cent of the budgetary allocation for Nigeria’s healthcare sector in 2010.

that we all have a role, particularly the private sector, in improving the quality of healthcare in Nigeria. The Honourable Minister of Health, Professor Onye- buchi Chukwu, reacted to the state of the Nigerian healthcare sector by inaugurating a ministerial committee in Au- gust 2011 to achieve His Excellency, President Goodluck Ebele Jonathan’s vision of establishing one world-class hospital and at least one private high-end diagnostic centre in each geo-political zone in Nigeria by 29 May, 2015. The ministerial committee has been charged with the mandate of unlocking private sector investment in building world-class hospitals and diagnostic centres. In Africa today, 60 per cent of healthcare delivery is private sector driven, with patients relying more on the privately managed hospitals for higher quality care and service. According to an IFC and Gates Foundation report on healthcare in Africa, an estimated $25–$30 billion in new investments will be needed to meet demand between now

230 Africa Speaks: A Collection of Speeches and 2016, of which $11–$20 billion is likely to come from the private sector. This implies that a significant investment required to unlock the health sector in Nigeria, will come from the private sector. To attract the private sector as a key player in healthcare delivery, the committee has articulated to the government that it must provide strong laws and appropriate regulation, which have large impact and ensure quality standards. Fa- cilitate risk-pooling arrangements, such as the provision of health insurance to improve the financing of healthcare, which encourages the development of higher-quality and more organised private sector providers. Finally, laws and regulations, which focus on streamlining bureaucratic processes that limit market entry and reduce tariffs and barriers that impede access to or raise the cost of health supplies. Unlike the mandate of other committees, this committee’s deliverable will be functional hospitals by 2015. Therefore, in the next few months, the committee will be inviting strategic and financial partners who will contribute decisions that will influence the direction of the committee. On the supply of health care, the committee will be calling for the submission of proposals for greenfield and brown-

In Africa today, 60 per cent of healthcare delivery is private sector driven, with patients relying more on the privately managed hospitals for higher quality of care and service.

231 Tony Elumelu, CON field projects by developers who have projects that can be scaled by the committee. Each world-class hospital selected will be of optimum quality and credibility, and accredited by recognised international bodies to guarantee world-class status. The committee is currently discussing the merits of Joint Commission International (JCI) accreditation. On the demand side, the committee is planning to hold advocacy sessions with state governments and local governments to increase subscription to the Health Insurance Scheme, which is currently under review. These sessions will seek to highlight the advantages and benefits of NHIS for their citizens and members respectively. The federal, state, and local government have a role to play in improving healthcare, as do the private and public sectors. Members of the guild have a role as well. Follow the work of the committee and join us as thought partners as we seek to build sustainable world-class hospitals in Nigeria. We have developed a website that seeks to engage experts. In your practices, understand that individual action translates to collective reality. How you operate matters. Your practices make up the building blocks of Nigeria’s health network. Reforming the health sector will be an on-going effort; one that we have to persist at if we want enduring results. I wish you a productive annual meeting. More than ever, Nigeria’s health sector requires collective leadership to move this sector forward. Thank you and God bless our country, Nigeria.

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Long-Term Investment in Africa

Speech delivered at Invest in Cameroon International Economic Conference, Yaounde, Cameroon, themed, Building Resilience and Attracting New Investors to The Cameroonian Economy 17-18 May 2016

233 Tony Elumelu, CON

I believe that the private sector has a role to play in advancing Africa’s development. I believe that we must recognise and embrace that responsibility by making long- term investments in strategic sectors which deliver economic dividends for shareholders and social dividends for society.

– Tony Elumelu, CON

234 our Excellency, President Paul Biya of the Republic of Cameroon, distinguished members of the Came- Yroon Government, citizens of Cameroon, investors and entrepreneurs and distinguished ladies and gentlemen. It is a pleasure to be here with you this morning to discuss how to attract and deepen investment in The Republic of Cameroon. I want to thank His Excellency, President Biya, for being such a gracious host and for bringing all of us together for this important dialogue. This is not only a good time for Cameroon to be having this conversation; it is also a smart time to be having it. As we speak, the giant economies of Africa, such as South Africa, Nigeria and Angola are dealing with some economic challenges, while countries such as Senegal, Cote D’Ivoire and Cameroon are experiencing important economic boom, expressed in economic growth. Foresight and fore planning can help countries manage their economies better at a time like this. Cameroon’s $28 billion economy is doing very well and growing at an impressive rate of 5.5 per cent, but due to foresight, you have chosen to host this conference at the right time to think about what it takes to attract and keep investors. As a long-time banker and entrepreneur, I have learnt how to spot a good investment, and I am pleased to affirm to all investors present that Cameroon is a great place to invest. I speak from experience and I know this, because of the

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United Bank of Africa, which I chair and which serves over eleven million customers in nineteen African countries, including Cameroon. We started operations in Cameroon in 2008, and we have been here ever since. In fact, in our initial roll out in Africa, Cameroon was the second country we established operations, and the first in Francophone Africa. In the short time that we have been here, UBA has also been making a positive impact in the communities we serve, and the country as a whole. Through our many branches we are helping to create employment, not only by lending to our customers to start and expand their businesses and hire people, but also by hiring Cameroonian citizens to help run our various branches both in Cameroon and outside the country. But even more significantly, UBA has been able to leverage our foothold in Cameroon to recruit and deploy Cam- eroonians to serve at senior levels in other subsidiaries. So when the past president of the European Commission, Mr. Jose Manuel Barroso, talked about education, my experience in fourteen countries shows that you have good human capital. In eight years of operation, we have had to export three people as CEOs to other subsidiaries across Africa. It is a testament to the quality of the talent available in Cameroon, and it is also what makes UBA a truly pan-African bank. I am pleased to say further that because of the investment environment here, we are growing further. I asked the minister of Land and Works, to delegate a piece of land in Douala, Yaounde for us to expand our operations and open more branches across Cameroon. Investors take decisions only when they are comfortable. We are doing this because

236 Africa Speaks: A Collection of Speeches we have confidence in the business environment. I assure you that we are here and we are long-term investors. But let me stress that UBA’s strategy and investments in Cameroon are not a happy coincidence or simply driven by the pursuit of profit maximisation. They are consistent with the philosophy that guides my investments and aspirations for the economic development of the continent. I believe that the private sector has a role to play in advancing Africa’s development. I believe that we must recognise and embrace that responsibility by making long-term investments in strategic sectors, which deliver economic dividends for shareholders and social dividends for society. The last speaker, the former prime minister of Korea, Dr Chung Un-chan, talked about shared growth and shared prosperity. I call it Africapitalism, because no one but us will develop Africa, and the private sector must rise in accom- plishing this. While it is advised that countries must be care- ful about a strong private sector, I wonder if South Korea could become so developed without a strong private sector. Imagine what would have been the fate of America without Steve Jobs and the iPhone, and Bill Gates of Microsoft. Government cannot do it alone. I believe that the financial services sector is one of those strategic sectors that will help transform the economy. I have therefore undertaken long-term investments in this sector, and it has proven to be successful in over a dozen countries in which we operate, including Cameroon. I have always argued that there is a lot of global private capital looking for the right kind of destination where it is welcome. So the genius is how to further attract private sector investments

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The truth is investors want to go to economies or countries where there is vibrant local entrepreneurship, where there are vibrant local entrepreneurs, because it is a telling factor. If the local entrepreneurs are doing well, it tells me as an investor that the market is good and there is an enabling environment helping them to grow.

to Cameroon in a manner that drives growth, and how to improve the operating environment so that it retains and continues to attract this private capital. I will explain in two ways: first in the area of power, there is a lot of available private capital, and there is a good market for you to sell, but for the kind of investment policies that some of our governments have put in place that ignores the enthusiasm of the private sector, who want to do more. When the privatisation process in Nigeria commenced, my group of entrepreneurs and I in that space had an objective to generate 25 per cent of the economy’s energy consumption. Today, we generate over 19 per cent of Nigeria’s total energy consumption. We can do more, but certain policies did not support our agenda to mobilise capital to do more. In fairness to the new government, there are improvements – the tariffs are now cost reflective and a lot of things are happening as they are supposed to. But if we had continued in that trajectory, today the story might not be the same. So policies, good policies, help a lot.

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The second case is that we know the challenges we have in Africa in moving from one part of the continent to the other. Economic integration in Africa cannot actually unlock the core in the manner that we desire if we cannot move people freely, if we cannot move freely. Speaking of moving freely, in 2006, I led a group of investors who partnered with Richard Branson to set up Air Nigeria. It was a partnership between the local investors, owning 51 per cent and Virgin Atlantic owning 49 per cent. We wanted to open up Afri- ca, but again policies did not allow this. After two years, we had to disband it and my group lost and wrote off about $200million. These inconsistencies in policy do not help to attract investments to the continent. If we address this, it will help to bring more investments to the continent. Cameroon is doing well already, but we must continue to encourage investors and more people into the country. And as more investors come, it has a way of attracting others like I am standing here today, an investor in Cameroon, and I and others will encourage other investors to come and do business in Cam- eroon. The second thing I want to talk about is the way we can also help to attract investments; it is what I call promotion of local entrepreneurship. Here, I align with the former prime minister who spoke before me. You may ask yourself: “how does the promotion of local entrepreneurship help to attract investments?” The truth is investors want to go to economies or countries where there is vibrant local entrepreneurship, where there are vibrant local entrepreneurs, because it is a telling factor. If the local entrepreneurs are doing well, it tells me as an investor that the market is good and there is an

239 Tony Elumelu, CON enabling environment helping them to grow. So if we want to attract investment into the country, let us try and build our entrepreneurs. Again, I believe that what the government is doing is commendable. If we want to attract investors, let charity begin at home. The fact that you are hosting this session now when the economy is doing well is encouraging. It is very important for all of us to put our heads together to see how we can continue to improve the conditions. Cameroon has human capital of twenty-two million people who can be the engine of economic growth. This is true of all of Africa, but we must ensure that this demographic boom does not become a demographic doom. While other regions of the world have aging populations, Africa’s youth dominate our demographic. This means that Africa is poised to become the engine of global economic growth. Like the last speaker said, Africa is the new economic growth reserve. But we need to make sure now that Africa is not just the characteri- sation of “Africa Rising”. The way to do this is to make sure that we invest in our young people. Governments, corporations, public and private sectors alone cannot provide enough jobs for the more than two hundred million young Africans entering the workforce by 2030. Therefore, one of the keys to winning the demographic dividend is entrepreneurship. At the micro-level, entrepreneurship is a bottom up approach to economic growth and development that empowers the individual to find and pursue the best opportunities in their current environment in order to improve their own economic circumstances. It also drives the creation of home-grown solutions to local problems in core areas such as food, education, health,

240 Africa Speaks: A Collection of Speeches water and sanitation, among others. At the macro-level, it is the expression of African solutions to African economic problems. Entrepreneurship means Africans have options for advancement that are not limited to just finding a job. They can create their own employment opportunity, as well as for others, and transform their communities, and even our continent. My belief in the inherent capacity of Africans to be successful entrepreneurs is so resolute, that through the Tony Elumelu Foundation Entrepreneurship Programme (TEEP) I have invested $100 million over the next ten years to identify, mentor, train and seed ten thousand African startups. In the two years of the programme’s existence, we have selected the best two thousand ideas from more than sixty-five thousand applications received from fifty-three of Africa’s fifty-four countries, irrespective of their age, gender, nationality, level of education or sector. All that the applicants needed was a transformative idea and the drive to succeed, and we gave them a chance. The first batch have already completed their training and received their first tranche of seed capital. I am proud to say that forty-four of Cameroon’s finest young men and women have been part of the programme. I met with them and our Cameroonian mentors last night at the Hilton Hotel. A good 25 per cent of them have keyed into the president’s vision of transforming agriculture. They have their eyes set on the agriculture sector and will do much to promote nutrition and food security in this country. Between these Cameroonian and African entrepreneurs could be the next Steve Jobs, the next Aliko Dangote, or even the next Tony Elumelu. There are many more aspiring

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African entrepreneurs out there who also deserve a chance, if only successful private sector leaders and our governments would work together to prioritise supporting entrepreneurs. My dream for Cameroon is that in the next few years, not I, but a Cameroonian Tony Elumelu Entrepreneur will be standing on this stage telling you about his/her investments in Cameroon and how they are creating thousands of jobs and generating revenues for the government of Cameroon while making profit and meeting local demands. That is Af- ricapitalism. That is shared prosperity. That is shared and inclusive growth. So I would like my foundation – The Tony Elumelu Foundation – to partner with the government of Cameroon to put into place concrete programmes and policies that encourage more young Cameroonians to start businesses that support them to succeed. Tough registration hurdles, multiple tax jurisdictions, onerous reporting requirements and lack of access to finance can extinguish millions of businesses before they start. But all of these are fixable and once done will fast track Cameroon’s economic transformation in a manner that is truly enduring and lasting. In closing, I want to again commend President Biya and the government of Cameroon for thinking about investment in Cameroon during the good times, and planning ahead for a stable and attractive economy that stimulates investments from within and welcomes investors from outside. I am honoured, Mr. President, as your neighbour and younger brother, to be a part of the discussion. And be rest assured, I am a long-term investor in Cameroon and a happy one at that. Merci beaucoup. Vive la Cameroon et vive l’Afrique.

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Inspiring Entrepreneurship in Africa

Speech delivered at Business Council on Africa, London, themed, Mainstreaming Entrepreneurship and Africapitalism 8 June 2016

243 Tony Elumelu, CON

Local Value Creation is a key characteristic of Africapitalism, an economic philosophy I developed to enjoin and deploy private sector participation in the development of the continent.

– Tony Elumelu, CON

244 embers of the management and leadership of Rothschilds of London, Clive Carpenter, Vice MChairman of the Business Council for Africa; Corporate and SME leaders and distinguished ladies and gentlemen, it is an honour for me to be invited to speak to this distinguished group of business leaders this evening. I want to thank the Business Council on Africa for your kind invitation and, especially, Clive Carpenter for your efforts to bring tonight’s event together. I also want to thank Rothschilds of London for hosting us in this wonderful ven- ue and all of you for taking the time to come this evening. Last week, in Paris, I had the opportunity to speak at the Bureau for Public Investment’s BIG Summit of Entrepre- neurs about how I am changing the world. I told them simply that I want to change the world by changing the narrative about Africa. Too many people associate darkness, poverty, disease, hopelessness and, of course, safari animals with the word “Africa”. More sophisticated people would add “dependence” to the list. My dream is for people to associate the word “opportunity” with Africa, for that is also the truth and the potential of Africa. And here is why. These are interesting times in Africa. The continent has gone from dictatorships, usually by the military from the 1970s to 1990s to the democratic, and somewhat democratic, regimes we see today. Many of Africa’s economies have opened up and liberalised to encourage investment and, to

245 Tony Elumelu, CON a substantial degree, the call has been answered. You have all heard for the last decade that seven of the top ten fastest growing economies in the world are in Africa and the World Bank has said that Africa provides the best return on investment. But let me take you further back, to illustrate some of the key economic changes that have taken place on the continent. In the 1990s, with the end of the Cold War and the loss of interest by the two Superpowers in securing the loyalties of African countries, aid flows began to dry up. Along with tighter budgets, a new attitude emerged in the political class to find “African solutions to African problems”. An attitude which, along with key policy reforms relating to commerce, permeated the private sector and created an unprecedented level of growth in multiple economies on the continent. And the results are measurable. In 1990, the amount of Overseas Development As- sistance (ODA) received by Africa, including through the generosity of the British taxpayer, was $26 billion and For- eign Direct investment (FDI) was only about $1 billion. In- tra-African investment was almost negligible. Fast-forward to 2013 and we find that ODA received by Africa was $56 billion and FDI was $57 billion. So while ODA has been growing and almost doubled since 1990, FDI, which was less than 5 per cent of ODA in 1990, has grown so quickly and overtaken ODA. Additionally, in 2013, experts estimated that there was $200 billion in private capital on the continent. When ODA and FDI were subtracted, the remaining capital, nearly $100 billion, came from remittances for Africans in the diaspora and intra-African investments. This is very significant.

246 Africa Speaks: A Collection of Speeches

Africa now has two new massive sources of financing that barely existed in 1990, to contribute to its economic growth and overall development – and both come from Af- rican sources. These remittances, which have mostly flowed into these economies informally, mainly went towards food, education, healthcare and SME growth. However, the intra-African investments were largely driven by a new class of home-grown corporates that have seen tremendous and exponential growth in several non-extractives sectors. Some of these companies may be familiar to you: MTN, the South African telecoms giant, which is in seventeen Af- rican countries. Dangote Cement, formerly an importer of this product now manufactures and distributes it in a dozen African countries. Shoprite, the giant retail chain operates in southern and West Africa. And the United Bank for Africa, which I chair, serves eleven million people in nineteen Afri- can countries. These companies, among others, collectively represent billions of dollars in annual revenues, millions of direct and tangential jobs, and increasing regional integration. More importantly, they represent a growing understanding that there is wealth to be made in Africa outside of the extractives sectors and that we Africans represent a market for our own products. So, there has definitely been opportunity for both foreign and African investors alike on the continent. However, over the last two years, the African continent has experienced increasingly tough economic challenges, particularly the large economies of Nigeria, South Africa, Kenya and Angola. This is because African economies still rely heavily on natural resources and commodities. The slowdown of the Chinese manufacturing sector and with it, China’s ap-

247 Tony Elumelu, CON petite for purchasing Africa’s natural resources has had an immense impact on the continent. Simultaneously, the exploitation of domestic sources of energy in the US, and the re-entry of the US and Iran into the oil market has sent the price of oil plummeting from $114 per barrel to the range of $40 per barrel. These events have significantly impacted government revenues in many nations. In some economies like Nigeria, GDP growth has slowed down to as low as 2.2 per cent per annum. It has surely been a difficult time for Africa, and we still have challenges ahead of us, but we will weather this period. I am a realist, so I must tell you that Africa remains a good bet for your investment. Even in these times, the economies of Senegal, Tanzania, Cote D’Ivoire and Cameroon are booming, so Africa’s economy does not lend itself to a single narrative. The assertion of the World Bank that the highest returns of investment are to be found in Africa remains true because the fundamental elements of our economies are still strong. These include: Demographics: In comparative and absolute terms, Africa has a youthful population. That means that we are a large market and our productivity potential is high. In fact, with the right policies and investment, Africa is poised to become the engine of global economic growth. Africa also needs to create two hundred million new jobs by 2030 to occupy this young population. So, our supply of young people can meet the demand for productivity. Increasing urbanisation: While this process does come with its concerns, 40 per cent of Africa’s population lives in urban areas and it is happening at a faster rate than other re-

248 Africa Speaks: A Collection of Speeches gions. Increasing urbanisation means increasing commercial activity in the city and easier markets to reach consumers. Technology penetration: The ubiquity of mobile telephony and broadband makes it easier to reach more of the population, given the spread and infrastructural challenges of the region. The introduction of mobile banking and other smart phone-based services has also brought millions of more people into the formal economy. Increased consumerism: Africa’s middle class and its young population have proven to have the purchasing power and a large appetite for goods and services. These factors along with the rising demand for jobs mean that the smart investor should look to invest in businesses that create jobs and consumer goods and services for less for the purposes of export and more for domestic consumption. I call this Local Value Creation, which is a key characteristic of Africapitalism, an economic philosophy I developed to enjoin and deploy private sector participation in the development of the continent. Africapitalism asserts that the private sector has a role and responsibility to help develop the African continent through long-term investments in strategic sectors that create economic dividends for investors and social dividends for society. So I encourage you, as smart investors, to continue to recognise Africa as an attractive destination, but ensure that you do the following two things: find the right partner to help you navigate the environment. It will make things easier and protect your investment; and commit to being in Africa for the long haul, because Africa rewards the patient investor.

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I know Africapitalism works because I was born, raised and spent my entire career in Africa, and I have been very successful adhering to this philosophy. I have invested in the financial services, real estate and hospitality, power, agriculture and health sectors because I consider them to be strategic to help unlock jobs and growth in other sectors of the economy, thereby delivering benefits to the wider society, whilst making profit. So, companies that are involved in these sectors should definitely come into our markets and partner with local businesses to provide goods and services to our population. Other strategic sectors in Africa include telecommunications, ICT, entertainment, transportation and retail, which will continue to do well even in the current climate. I believe that Africa’s greatest challenge today is not poverty but the untapped potential of its human capital. I also strongly believe in the transformative abilities of Africapi- talism. I started my remarks saying that I wanted to change the narrative about Africa from dependence to opportunity. Therefore, I have a responsibility to help create opportunity on the continent, even beyond those inherent in my commercial activities. I believe this can be best achieved by promoting entrepreneurship. Promoting entrepreneurship is essential because governments and large corporates do not have the capacity to provide employment for the millions of young Africans entering the job market every year. Therefore, we must empower the youth on the continent to create their own jobs and take charge of their futures by starting their own businesses. Many of them are so talented and merely need a

250 Africa Speaks: A Collection of Speeches chance to take off. They are designing apparel and apps, and educational models and agricultural supply chains, among others. But they are shut out of the formal economy by bureaucratic and regulatory obstacles, policy gaps and lack of access to capital, markets and training. As an entrepreneur, I have decided put my money where my mouth is, and provided capital, directly and measurably, to nurture the next generation of African business leaders as Africapitalists, through the Tony Elumelu Foundation’s Entrepreneurship Programme. The programme represents a $100 million commitment to identify, train, mentor and seed ten thousand Afri- can businesses over the next ten years, towards creating one million jobs and $10 billion in additional revenues across the continent. The tagline of the programme is “Your idea can transform Africa.” The documentary you have just watched is the genesis and the gathering of the first class of one thousand entrepreneurs in the programme, representing fifty-one African countries. They also represent the best one thousand transformative business ideas of twenty thousand submissions in 2015. For the Class of 2016, we chose the best one thousand of a whopping 45,000 submissions. We took this route in designing the programme because, as a young African, in addition to having a lot of drive and determination, I was lucky to benefit from the guidance of a mentor who tapped into my potential and prepared me for the business world. And when the time and opportunity came for a group of other young bankers and I to take over a shuttered bank and turn it around, we found some investors who believed in us. With their support, we not only succeed-

251 Tony Elumelu, CON ed in turning it around, we grew it into the United Bank for Africa, a truly pan-African bank with the largest footprint of any home-grown financial institution on the continent, serving eleven million people in nineteen countries. I believe that Africa has the potential to produce one thousand more UBAs, more MTNs, and even our own Ste- ve Jobs through private sector investment. So we made the decision to institutionalise and democratise the same “luck” that I had as a young African. The same luck that led me to this moment, by creating a merit-based sustainable empowerment programme that is open to Africans of all nationali- ties, ages, gender and sectors, all of whom have no personal connection to me, beyond our common identities as Afri- cans and entrepreneurs. Additionally, we are identifying and advocating for policy reforms in individual countries to enable not just the Elumelu entrepreneurs, but also all African entrepreneurs to succeed. So, while I may be the more obvious entrepreneur of choice for a business partnership today, I am also investing in developing your future partners and it will be a dream come true for me to witness Tony Elumelu Entrepreneurs doing business with British and European investors. In closing, I want to thank you all again for gathering here today, and for your enthusiasm, as members of the private sector, about the commercial opportunities in Africa. The fact that you have formed the Business Council on Af- rica is a clear indication that you already believe in Africa. The difference now is that you are dealing with an Africa that believes in itself and is confident about its future. Thank you.

252 Africa Speaks: A Collection of Speeches

The Philosophy of Africapitalism in The Power and Energy Sectors

Speech delivered at AELG Inaugural Meeting, Metropolitan Club, Lagos, themed, The Vision and Mission of the African Energy Leaders Group 15 February 2016

253 Tony Elumelu, CON

Africa is poised to become the engine for global economic growth but this cannot happen in the dark. It can only happen with sufficient and reliable electricity.

– Tony Elumelu, CON

254 our Excellency, President Alassane Ouattara of Cote D’Ivoire, Your Excellency, Vice President, Yemi YOsinbajo of Nigeria; President Donald Kaberuka, President of the AfDB and my co-Chairs, distinguished members of the African Energy Leaders Group, and ladies and gentlemen. As one of its private sector founders and co-chairs, I am honoured to be here with you this morning for the inaugural meeting of the African Energy Leaders Group (AELG). I want to thank my co-founders and co-chairs for their leadership in launching this initiative. I particularly want to thank my friend and brother, Dr. Kandeh Yumkella, whose vision and tenacity have brought about the creation of this organisation. I also want to thank our co-chair, President Ouattara for his graciousness in hosting this first meeting. Even as African and world leaders preoccupy themselves with the agenda for global development, they have acknowledged that the lack of access to modern energy services is not just a symptom of poverty. Lack of access to energy, or power as we call it, perpetuates poverty and hinders development. We hope that, guided by the findings and efforts of the UN Sustainable Energy for All Initiative, the soon-to-be announced Sustainable Development Goals (SDGs) would include “Universal Access to Energy”. We have created the African Energy Leaders Group with that same vision, that is, to ensure “universal access to

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Lack of access to energy, or power as we call it, perpetuates poverty and hinders development. We hope that, guided by the findings and efforts of the UN Sustainable Energy for All Initiative, the soon-to-be announced Sustainable Development Goals (SDGs) would include “Universal Access to Energy”.

affordable and reliable modern energy services” for the six hundred million Africans who lack access to electricity in Africa, and West Africa is leading the way. Our mission is to create a forum and the conditions for the public and private sector, in the West Africa region, to collaborate in achieving the vision of universal access and set an example for the entire continent. What is unique about the AELG is that it will be about on-going dialogue between the public and private sector on how to address our challenges, and measure the progress made, through specific projects, in increasing access to electricity for the three hundred million people in West Afri- ca. And I want to be clear that this is not just about social development. It is about the economic transformation of a continent. It is about ensuring Africa graduates from the economic shackles of low returns from extractive driven exports and revenue draining imports driven by consumption and aid dependency, to a new era of local value creation and economic self-sufficiency.

256 Africa Speaks: A Collection of Speeches

I am personally committed to being a long-term investor in generating power for our people. In 2013, I publicly committed to investing $2.5 billion in the power sector in Afri- ca. As the first step in fulfilling that commitment, through Transcorp, a company for which I am the chair and majority shareholder, we acquired the largest gas powered generating plant in Nigeria. We took over management of the plant in November 2013 and found it only generated 160MW of the 1,000MW capacity. Within six months we had doubled that, and now eighteen months later, we are almost at 700MW. By the end of this year, we will be generating 1,000MW and are in discussions with GE to add an additional 1,000MW. My target is to generate 25 per cent of Nigeria’s power, regardless of how much the sector grows from the current 4,000MW. For me, this is not just about talk, but also about action because power is so desperately needed. I subscribe to an economic philosophy that I call Africapitalism. Africapitalism advocates for long-term investment in strategic sectors that will generate economic value for investors and shareholders and social value for society. In other words, we need to invest in sectors that pay both economic and development dividends. Providing access to electricity for schools, hospitals, businesses and industries is the single most impactful intervention that can be made to transform the continent. It has tremendous implications for job creation, health, food security, education, technological advancement and overall economic development. So access to power is “mission critical”. We also need access to electricity for another vital reason. While other continents have aging populations, Africa has a very young population. This means Africa is poised to become the en-

257 Tony Elumelu, CON gine for global economic growth, but this cannot happen in the dark. It can only happen with sufficient and reliable electricity. And it must happen because our young population needs jobs. Africa needs to create one hundred and twelve million jobs for our growing young demographic by 2025. To create these jobs, we need to industrialise and begin to achieve “local value creation”. We must begin to take back the value addition process to our natural resources to meet our local consumption demands. That means we must refine our crude into petrol. We must turn our palm oil into cooking oil. We must turn our cocoa to chocolate, and we must manufacture our own phar- maceuticals, our own furniture and our own vehicles. But as our good friends at UNECA tell us, “Africa cannot industrialise on a weak power base.” So we must fix our power problem by attracting investments that increase generation and put thousands and thousands of more megawatts on those grids. In Nigeria, for example, the government took bold steps in privatising generation and distribution that resulted in billions of dollars of investment. But now the next bold step needs to be taken and the transmission also must be privatised. Then the private sector can invest in producing and distributing more power while the public sector will regu- late and incentivise more investment. Therefore, the AELG will focus on four key areas: Advocating for privatisation and investment: Governments cannot successfully act as power providers for all their people. This is a function of the private sector. We particularly need to encourage privatisation and investment including small-scale off-grid projects to ensure that we are

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Securing private sector investment will require the appropriate national policies and regulatory frameworks that are stable and long-term. In addition, to achieve economies of scale, we also need policies that enable regional power investments. Finally, we also need to create policies to guide off grid investments.

also catering to our citizens in small towns and rural areas. Integration: This is the improvement of the supply and value chains of power, from inputs to generation to distribution in large grid projects. Public Private Sector Partnerships: We will encourage joint ventures to enable us to diversify the risk in ambitious cross border projects. Policy: Securing private sector investment will require the appropriate national policies and regulatory frameworks that are stable and long-term. In addition, to achieve economies of scale, we also need policies that enable regional power investments. Finally, we also need to create policies to guide off grid investments. The Executive Board of the AELG meets today, along with some of our members. We aim to recruit more business leaders as well as investment and power companies from all over the world, to join the AELG or partner with us in this initiative. The day-to-day work of the AELG will be done by the Secretariat that we will establish today.

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My good friend and co-chair, Dr Donald Kaberuka has offered to house the AELG Secretariat in the African Devel- opment Bank. The secretariat must be well funded to function effectively. And we must all commit to ensuring that happens. So today, I am making a pledge to provide $150,000 over the next three years to support the operations of the secretariat. I want to call on the governments of the member states of the ECOWAS region, and AELG members and partners to also step up with significant multiyear commitments to sustain the organisation. Finally, I also want to call on our public and private sector leaders in North, East, central and southern Africa to join hands with us in this effort so that across Africa public and private sector leaders collaborate to elevate and prioritise access to electricity towards the development and economic transformation of the continent. This is a mission that must succeed, and I am proud to join with all of you here to make certain that it does. Thank you.

260 Africa Speaks: A Collection of Speeches

Advocacy for the Progress of the Power Sector in Nigeria

Speech delivered at the 2nd Annual Powering Africa Summit, Washington, D.C., 27 – 29 January 2016

261 Tony Elumelu, CON

We must win the energy challenge, because over 600 million Africans lack access to energy and Africa needs 120 million jobs for our growing population.

– Tony Elumelu, CON

262 ood morning everyone. My name is Tony Elumelu, Chairman of Heirs Holdings Ltd. It is a pleasure to Gbe here this morning, with fellow investors, operators, financiers and technocrats. I thank Andy Herscowitz for the invitation. I am an Africapitalist who believes that the private sector must acknowledge and embrace our role in promoting development by investing in strategic sectors, which yield economic and social dividends. Through Transcorp Power, Heirs Holdings made a $2.5 billion commitment to deliver 2,000MW under the Power Africa Initiative. Transcorp is a key player in the Nigerian energy sector. We currently generate about 19 per cent of Nigeria’s total power consumption, and our intent is to generate 25 per cent of total energy consumption. So, where some see only problems in Africa, I see business opportunities in providing solutions to such challenges. We must win the energy challenge, because over six hundred million Africans lack access to energy and Africa needs one hundred and twenty million jobs for our growing population, but surveys of African businesses repeatedly show that energy costs are over ten times what it is in the US This dramatically increases the cost of doing business in Africa. Power is a crosscutting issue that has impact on health care delivery, job creation, education, food security communications and every other sector of development. Af- rica seeks to become an industrial power in the twenty-first

263 Tony Elumelu, CON century and we cannot achieve this on a weak power base. I am invested in a variety of sectors including financial services, hospitality and real estate healthcare among others, but every day, I start work with a view of the dashboard of the megawatts generated at our Ughelli power plant. And I can tell you that, good or bad, the numbers have an emo- tional impact on me. Every day. In this final year of his presidency, I want to thank Presi- dent Obama for not shying away from the tough issue of energy poverty. Instead he has tackled it head on, and with the astuteness to understand that the conventional development model of government financed projects will not deliver the much needed megawatts at the scale required. So he invited the private sector as partners and stakeholders. Critically, he involved the African private sector in this initiative. Thank you, Mr. President. I also want to thank his team that to helped design and implement this trailblazing programme, including Ambas- sador Mike Froman, Gayle Smith, Benjamin Rhodes, Eliz- abeth Littlefield, Mimi Alemayehou, Raj Shah and not least of all Andy Herscowitz and the hardworking Power Africa team. Working together through Power Africa, the US government and private sector have engaged one hundred and twenty public and private sector partners, and marshalled $43 billion to create sixty million new power connections, using a mix of power solutions. This is going to make a world of difference in Africa. The evidence will be the visi- bility of Africa from space. I want to congratulate Andy and his team for this clear and strategic road map. I will stress that Power Africa can give us a road map; set

264 Africa Speaks: A Collection of Speeches

… surveys of African businesses repeatedly show that energy costs are over ten times what it is in the US

targets and provide technical assistance and partners. But it is up to us partner countries and the private sector to implement it. It is up to us whether Power Africa is a success or not. I can tell you Africa has had enough of power failures. So we must remain committed and resilient because the enabling environment for this sector on the continent is tough, but it is getting better, and Africa handsomely rewards the patient investor. It is not just enough for us to be resilient investors. Ac- cess to power is a humanitarian emergency in Africa. Lives are lost every day that the power deficit persists. These endless power outages must spark an outrage – the kind of outrage that ignites the activist in each of us. How can we not be outraged when the studies show that the poor pay the most for power? This is because they can only buy it in small quantities. How much is a fair tax on their suffering? I have taken my outrage and I am channelling it into action for change. Hence, not only am I investing in the power sector, I have become an advocate for expanding universal access to electricity in Africa. I advocated for access to energy to become a Sustainable Development Goal and joined the board of the UN Sustainable Energy for All Initiative. With my colleagues, Aliko Dangote, Kandeh Yumkella, and Donald Kaberuka, I cofounded the African Energy Leaders Group

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(AELG), a public private sector partnership, which seeks to elevate and prioritise this issue among regional and global policy makers. I also support President Akin Adesina’s New Deal for Africa’s power transformation under the African Development Bank. Over the last two Congresses, I have engaged in advocacy with US lawmakers to get the Electrify Africa Act enacted. This bill would effectively preserve and expand the Power Africa Initiative well beyond this administration by codifying access to electricity as a US foreign policy priority for Africa. I want to thank Senators Bob Corker, Ben Cardin, Jeff Flake and Chris Coons for their leadership in getting this bill passed in the Senate. You do not know this, but I was actually on my way to Accra from Lagos when I decided to stop by Washington D.C. to lobby again for the bill and tes- tify on US Africa trade. But apparently, the House is closed. So, earlier this week, on behalf of the AELG, Aliko Dan- gote and myself wrote a letter and op-ed to the US House of Representatives to thank Congressmen Royce and Eliot Engel for their leadership on this issue in the House. The bill comes to the House floor next week Tuesday. I am not telling you this to entertain you. You have invested in this initiative and I am asking you to protect your investment and the future of the programme. I want you all to leave this place and call all your representatives and the leadership of the House and tell them to pass this bill. Africa cannot wait for power. We need Power Africa, we need a swift and strong reauthorisation of OPIC and we need the Electrify Africa Act. So please make that call. Long live Power Africa. God bless Africa, and God bless the United States of America.

266 Africa Speaks: A Collection of Speeches

The Collaboration of the Public and Private Sector Especially in Eastern States

Speech delivered at “Oganiru”, the Enugu State Investment Summit, Enugu State, Nigeria, themed, The Role of Private Sector in Nigeria’s Development and Southeast Regional Integration 12 April 2016

267 Tony Elumelu, CON

The governors should come together and think about how to create industrial cities.

– Tony Elumelu, CON

268 ur host governor and our biggest export to the Ni- gerian federation; the deputy senate president of ONigeria and his excellency; immediate past gover- nor of Enugu state, the high commissioner and the ambassadors who are here today; the fathers of the day, the spiritual leaders who are here, Senator Jim Nwobodo and his great wife; my secondary school teacher, Dr. John Amodo, and so many other people here; my ex-colleagues and people I have interacted with. I would like to say I am very grateful to the governor and Mr. Ike Chioke for creating this opportunity for me to be here this morning. Two, I would like to commend the governor and his team for thinking it worthwhile and worthy to organise this investment forum. I had certain considerations in accepting to be here. First is that I see myself as a son of the soil, and two is that I believe that the state, the government and people who have thought it wise to encourage this kind of forum should be encouraged by all of us. For so long, we have all condemned the government that they do not do what we expect them to do. At times, we shy away from playing our own part in making it work. So this is a great opportunity for all of us to rub minds. Even though it is for Enugu state, I see it beyond Enugu state. I want to see it as a sub-regional approach to develop government. We have always talked about life beyond oil. I know some years back I was in my state, Delta

269 Tony Elumelu, CON state where a similar event was organised – Delta Beyond Oil. But when I saw this invitation, I asked myself what has come out of that session. Here again, we have a similar session and I hope that we take corrective actions to begin to implement what you come up with at the end of this worthy event. Our students of Nigerian economic history have known that our country for a long time has relied excessively on oil, and for a long time we have also talked about diversifying from oil. But it seems as if once the oil price improves, we drop the idea of diversification and when it goes down again, we start talking about diversification. So this topic is apt, interesting, but I hope that after this year, Nigeria does not talk about this. We need to start seeing concrete action coming out of these sessions. I like to say that every country that has developed has achieved this by recognising and creating the opportunity for the citizens of the country to demonstrate ingenuity and creativity, and we need to do that in Nigeria for us to make progress. On the issue of our development, as a member of the private sector, I want to move away from the blame syndrome. Most times we blame the government and to a large extent, it is valid as they have a large control and management of natural resources. But when we blame them, most people look at the federal level without looking at the sub governments. The truth is that development in the twenty-first century is a collective responsibility. All of us have the key role to play in the development of our economy, and I call this Af- ricapitalism. We need to get the federal sector to invest long- term in a manner that will help improve our economy. But

270 Africa Speaks: A Collection of Speeches we also need both federal and state to play their roles in the development of our country. I have a personal experience as a private sector person who has tried to play my own role to foster the economic development of our country, and I want to share some of this today, not to blow one’s trumpet but to see if we can catalyse other private sector leaders among us to also do similar things. In the twenty-first century, I believe that what defines you as a successful person is not what you have in your bank account, but what you have been able to convert into investments that help to propel growth. We have seen around the world that what drives investments is entrepreneurship, job creation and creating the right environment that will enable our people to demonstrate and practice their ingenuity. That is what all of us must collectively do. Coming into Enugu this morning, I can see that the roads here need further improvements, and over the years we should continue to improve as a state and as a country. I commend the previous governor and the current governor for taking this further. Listening to Minister Fashola’s presentation, which was delivered by Ayo, I agree with most of the points and I believe that capital goes to where it is most welcome. Capital should come to the East as an economic block but for it to happen, the private sector has to take advantage. I have observed the case here. Growing up, Eastern Nigeria was seen as the powerhouse of the country akin to what you see in Taiwan. In fact, most people saw Eastern Nigeria as the Israel of Nigeria. For so many years now, we have not seen this translate to real development that can help our people and youth have jobs. So what should we do as the private sector to make this

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The truth is that development in the twenty-first century is a collective responsibility. All of us have the key role to play in the development of our economy, and I call this Africapitalism. happen? Government needs to help us to create the right environment. Two weeks ago, I was with the senate to share my ideas on creating an enabling environment to help Ni- geria take off. I am happy that the deputy senate president is here, legislating and implementing some of the bills we have in the house, which will help us in creating the environment that will bring development, not just in Enugu state, but also in the entire country. And for Enugu state and Eastern Ni- geria, I want us to look at things from a regional perspective. Instead of looking at one market in Enugu, we should look at the entire Eastern Nigeria as an entire market to attract investment. At Nnewi, I saw what happened not too long ago with the gas explosion. We need to do more, and we cannot do much in the eastern part of Nigeria if we do not deal with the issue of power. If we look at Nnewi (I know Nnewi is in Anambra, but I see this as a regional economic discussion not just about Enugu state), I am personally aware of efforts that our people are making to bring power to other states. When we had the LPG gas explosion in Nnewi, I felt very sad for our people, not just easterners but for Nigeria in general, and I believe that in the twenty-first century we can do more than we are doing. I have to commend Min-

272 Africa Speaks: A Collection of Speeches ister Fashola and the president for the new willing buyer, and willing supplier. We have Transcorp Power, which is one of our subsidiaries. We generate power at Ughelli. We have the capacity to create 750MW of electricity. I have taxed my people at Transcorp following what happened at Nnewi to see how we can extend our power supply to Nnewi. But this cannot happen if we do not have all key players coming together, federal and state government, giving right of way for the cables and transmission lines to be laid. This is possible and I believe that the private sector will make an investment decision like that, if we are supported by the federal and state government with incentives. This will help the people of Nnewi and all of Eastern Nigeria to develop. Why am I talking about Nnewi? For me the approach to growth in the eastern region should be a regional approach to identify key regional centres, industrialised cities – Nne- wi, Onitsha, Enugu, Aba, Abakaliki. So many of these places, we need to have a combined effort. The governors should come together and think about how to create industrial cities. When I say create industrial cities I mean more than dedicate land, but to go there and put infrastructure that will enable businesses to spring up and do well. This is doable; this is possible, but we need the governors to come together and cooperate in putting in place this kind of infrastructures. In trying to create these cities, the ones we have already, that is Aba, Nnewi, Onitsha, we need to get them working already. This is what our youths need across the eastern part of the country. They do not care where the job is, they can move from Enugu to Owerri to work, from Aba to Onitsha to work, as long as the job is available for them to be gain-

273 Tony Elumelu, CON fully employed. The issue of unemployment is becoming a major issue that we need to deal with before it consumes everyone. What I want to see is a situation where we all play our roles working together in these industrial cities to make this happen. Private sector has the expertise and capital to make things happen. To make this happen we need the right environment, which is why I say that our state governments need to think of this type of initiatives and regional infrastructures to help fast track growth and developments. Our state governments should stop building stadiums, they should think about railways – I am not saying we do not need stadiums, but I think we have enough. When resources are tight, we prioritise and focus on things that are more important. The eastern states need to be linked by railways. We need to see good roads. If government cannot do this, they need to create regional incentives that can attract private sector to come in. If I want to go to a large market, I’d rather see the eastern region as one market instead of one state. The governors of Eastern Nige- ria should come together to create a bigger regional market through infrastructure and harmonisation of polices. You go to some states and the issues of taxes discourage investors from coming in. I would like our governor who started this initiative to bring together his colleagues across Eastern Nigeria and begin to think about medium term economic development packages for Eastern Nigeria that goes beyond one state. Let them identity key things that we need to focus on. I have some recommendations. I want to share a second thing with all of you. The Oji River, when Governor Chime was in office, we saw an opportunity there, because we wanted to take advantage of

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Enugu, bedrock of coal, to increase power generation. The capacity of Oji River was 30MW of electricity, but we came in and we had a good discussion with the governor and the minister of power, but this did not take off. We got our partners from Australia, they came in with us as they are used to converting coal to power. Unfortunately, at the federal level – this was last year before the election – we could not get the ministries of power and solid minerals to get together. Solid Minerals said Oji River was their project while power ministry wanted it. So we ended up not making progress, and who is the loser here? Enugu state indigenes and people in this part of the country, and the country in general, as our plan was to move it from 30MW of power to five hundred megawatts in five years, producing 100MW every year. Five hundred megawatts would have stopped the deaths in Nne- wi. So the message here is that the private sector has a role to play, and we will play that role but we need our country working together in policy formulation and harmonisation in all practices and also in the area of creating incentives to help create jobs. You hear government say that they will hire ten thousand or one hundred thousand people; that is in- significant when you consider the number of unemployed people. Through the support of the SMEs and through the support of providing infrastructure we can unleash the true potential inhibited by our people. So the key message from me here is that we need our government to sit together to provide the support that the private sector needs to achieve and actualise its objectives. Two more things I want to talk about, beyond investment, long-term investment and how the private sector can

275 Tony Elumelu, CON help capitalise growth and economic development. Again I want to share our experience at TEF. The Tony Elumelu Foundation is one I founded in 2010 and two years ago. I seeded the sum of $100 million to help create ten thousand African entrepreneurs to help develop our continent, as I believe entrepreneurship is the way to go. The first year we had fifteen people who benefited from the programme in Enugu state and the second year we had sixteen people. Enugu state had thirty-one people from 2015 to 2016. These are people who we will give $10,000. We train them and help them become fisherman instead of waiting for people to feed them, and then hopefully they also will help to create more employment for others. In all of Eastern Nigeria, we have ninety people who have benefited from this in the last two years. But for me the real initiative is this: We have other people from Nigeria and Eastern Nige- ria in particular who are wealthy. I want to challenge all of us to help out young ones, to help and create opportunities to support them to be self-reliant. Be suppliers of labour and commend the journey to entrepreneurship. After all, when we designed the entrepreneurship programme we interacted with people in the Onitsha market. Because that is where you have apprenticeship; therefore, we already have the entrepreneurial spirit embedded in our people. All we need to do is help train them and provide seed capital that will enable them take off. This again is one of the ways the private sector can help to catalyse development. To conclude governor and deputy senate president, I hope this session will go beyond talking. We should begin to work together and see the east as an economic region. Thinking beyond the state. Let us harmonise our policies,

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We have seen around the world that what drives investments is entrepreneurship, job creation and creating the right environment that will enable our people to demonstrate and practice their ingenuity. common transportation and security. The truth is that if we have only one developed state, there would be too much pressure on the state. Let us have a common development goal across Eastern Nigeria. One year ago, we wanted to build a mall in Lagos and Fashola approved of it, and after a new governor came in, it was cancelled and now we have to start afresh. Why can’t I come to Enugu to build that mall? We need to make sure that the right environment is created, and I feel like we are well on our way with Enugu state. Second advice I have is to turn Eastern Nigeria into a bigger and more exciting market. I grew up seeing both Aba and Onitsha market being one of the largest markets in West Africa. Let us get them back to those levels. Our government needs to create regional incentives to attract investors, things like multiple taxation should be eliminated. Let us also focus on the education sector and rebuild our competitive advantage. The biggest resource we have now is our people. Let us not despair because of our current economic situation. There are several countries who have come out of more despaired situations like Vietnam, which was once a very poor country. Today their income per capita is over $2000. Also consider Ethiopia, a country, which was at war for several years. Today they provide power to some

277 Tony Elumelu, CON neighbouring countries. So it is never late to start. Let us change our nation starting with Enugu. Ghana should be a motivation; it is now a regional hub as they have strategically developed their nation. The ingenuity of the Igbo man is amazing. If we continue along the lines of what is happening in Aba we can change our nation. Let us focus more on vocational training and developing people. We already have many universities and tertiary institutions. Let us focus on other areas. State houses of assembly should pass common laws to enable our environment. Let us look to Kaduna who recently passed a law for harmonisation of taxes. Again, let me thank our governor and the multiple people who helped make this happen, local leaders and those who set the path for some of us to follow. We should not see this gathering as an end, but rather as a means to an end. How we will be judged in future is what happens subse- quent to this meeting. I have heard that the governor is a “can do” governor. I ask you to please take your place in history. Let this be a commencement of a new paradigm toward the development of this country. Not if, but when you will implement what we discussed here. Broaden the coalition and try to create a wider Eastern Nigerian so that other governors will take a cue from this. You are lucky to have the deputy senate president on your side as well as Ike Chioke who we respect in the private sector. I speak on behalf of our group of companies and myself. If we see you move in the right direction as we think you would, we will seek more and make more investments in the state. Thank you very much.

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Providing Accessibility for Entrepreneurs at the Legislative Level

Speech delivered at The National Assembly Business Environment Roundtable, Abuja FCT, Nigeria, themed, A Comprehensive Review of Institutional, Regulatory and Legislative Impediments to The Private Sector 21 March 2016

279 Tony Elumelu, CON

We need to empower and enable the job creators and future job creators, by which I mean the start-ups and small businesses who can create millions and millions of jobs by simply employing one person. They are our salvation and our elevation.

– Tony Elumelu, CON

280 istinguished Senate President, Bukola Saraki, Dis- tinguished Speaker of the House of Representa- Dtives, Dogara Yakubu, Honourable Ministers of the Cabinet present, distinguished Members of the Senate, and Honourable Members of the House. As vice-chairman of the Competitiveness Council of Nigeria, founder of the Tony Elumelu Foundation, and a Nigerian citizen, I am extremely proud to be here today. This meeting and effort is a humble acknowledgement by our leaders that our laws are not perfect, that we need to review, amend and enhance many of them, and that there is much work to be done to pass new legislation to improve the lives of our people. The proper role of government is not to provide employment for everyone, but to create, sustain and secure an enabling environment for citizens to independently create their own jobs and their success, using their own talents. Also, that the private sector is the engine for economic growth in Nigeria, and indeed anywhere else. On behalf of my colleagues in the private sector, the established big corporates, the small enterprises and the budding entrepreneurs, I thank Senate President, Bukola Saraki, and the National Assembly for taking a thorough, systematic and transparent approach to this review, and for understanding that, for the best results, the public, particularly the private sector must participate in the process of identifying and

281 Tony Elumelu, CON

I can tell you from real data that the thirst and talent for entrepreneurship is highest in Nigeria.

debating laws meant to increase their numbers, productivity and success. I also want to recognise and thank the National Eco- nomic Summit Group, who has been pushing for several years for a comprehensive revamping of our laws relating to the private sector. In particular, their CEO, Folusho Phil- lips. I also want to thank John Smith International, DFID and your other partners for the excellent work done with the MSMEs survey and report that form the basis of today’s discussions. The Tony Elumelu Foundation has also made a submission based on our survey of applicants to the Tony Elumelu Entrepreneurship Programme. I am a proponent of Africapitalism, which advocates for the private sector to acknowledge and embrace its critical role in Africa’s development. Through the $100 million Tony Elumelu Entrepreneurship Programme, over the next ten years, we will seek to identify, nurture and provide seed capital to ten thousand African businesses based purely on the merit of their ideas, and tomorrow we will announce the second one thousand people who will make up the Class of 2016. I can tell you from real data that the thirst and talent for entrepreneurship is highest in Nigeria. So far, with four hundred and ninety-eight beneficiaries, Nigerian entrepre-

282 Africa Speaks: A Collection of Speeches neurs represent 50 per cent of TEF entrepreneurs because they represent 50 per cent of the best ideas submitted for consideration. I can also tell you that the enabling business environment is a real challenge everywhere on the continent. From long registration processes and obstacles, lack of access to finance, weak infrastructure, multiple and very complicated tax liabilities, to visa requirements, we have a million ways to extinguish businesses and partnerships before they begin. The hard truth is that we depend on our export commodities and the resilience of our entrepreneurs and that makes us extremely economically vulnerable. Now that the commodity market has drastically let us down, we need to ensure our economic recovery and continued growth by lifting our entrepreneurs up. In particular, we need to empower and enable the job creators and future job creators, by which I mean the startups and small businesses that can create millions and millions of jobs by simply employing one person. They are our salvation and our elevation. We have heard some wonderful statements from our legislative leaders today. As you will probably understand, a lot of talking has been done over the years around the issue of improving the enabling environment for business. The prayer of the private sector is that we move from talking to

The hard truth is that we depend on our export commodities and the resilience of our entrepreneurs and that makes us extremely economically vulnerable.

283 Tony Elumelu, CON

The prayer of the private sector is that we move from talking to doing. If we make these changes, we can unlock countless jobs and opportunities in the country.

doing. If we make these changes, we can unlock countless jobs and opportunities in the country. I will remind you that without spending any money, over a decade ago, the federal government started issuing GSM licenses. This revolution- ised a sector that in turn unleashed countless jobs. I believe we can achieve something similar by passing other pieces of legislation like the land use reform, to enable people sitting on valuable asset, own, monetise and collateralise the wealth they are standing on and get access to capital to start or grow their business. So let us go about the business of doing, so our entrepreneurs can go about their own business. In closing I want to say that what we do in Nigeria will set the example for other African nations and the National Assembly is off to a great start with this initiative. I thank you again for this initiative to unleash Nigeria’s entrepreneurs. I assure you that the private sector will be your partner in this worthy cause to pass the necessary measures to help assure the survival and success of startups, SMEs and major corporates in Nigeria.

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Africapitalism as a Catalyst for the Development of Africa

Speech delivered at Oxford University, London, themed, Africapitalism, Entrepreneurship and the New Africa at Oxford University 22 May 2015

285 Tony Elumelu, CON

Africapitalism’s call-to-action is to use your power as individuals – employees, employers, investors, and consumers – and leaders in the public, private and social sectors to support the kind of business practices that lift up society whilst making profits.

– Tony Elumelu, CON

286 hank you very much Dean Tufano for that very generous introduction. It is great to be here at Oxford TUniversity, which continues to play an important role in the articulation of key global issues, as it has for hundreds of years. I would like to appreciate the organisers of this conference for encouraging new thinking and perspectives about Africa across all disciplines. I particularly want to thank Yas- min Kumi for her tireless work to facilitate my presence here today. I want to speak about “Africapitalism as a Catalyst for Development in Africa”. Today is a continuation of a conversation I started in November 2014 with a piece in The Economist, where I de- clared that 2015 would be “The Year of the African Entre- preneur” and backed it up in December by launching the $100 million Tony Elumelu Entrepreneurship Programme, also known as TEEP. This programme is identifying and providing mentoring, training, networking, and funding for one thousand African startups per year for the next ten years. The programme kicked off on 1 January 2015, and we had an amazing response from across Africa with over twenty thousand applications from fifty-four African countries and territories. With support from Accenture and a pan-Af- rican Selection Committee, we picked one thousand amazing entrepreneurs from fifty-two African countries. These one thousand are now in the midst of a twelve-week online

287 Tony Elumelu, CON business skills training programme, and have been paired with four hundred expert mentors from around the world. In July, they will come from all corners of Africa to Lagos for a boot camp where they will complete their training, receive their first cheques, and build pan-African networks that will last a lifetime. Last week, I was at the White House in Washington to support President Obama’s Global Entrepreneurship Initi- ative, “Spark”, where I was invited to speak about my vision for how entrepreneurship can transform Africa, including a focus on the Tony Elumelu Foundation Entrepreneurship Programme. The following day, I gave a keynote address at George- town University titled “Entrepreneurship-led Develop- ment”, where I spoke specifically about how entrepreneurship represents a bottom-up approach to development – the kind of small, young entrepreneurs supported by my foundation. I have focused on entrepreneurship because it is the beginning of the story of how private enterprise can impact the development of Africa. After all, a healthy and resilient business ecosystem has a spectrum of enterprises – from the small entrepreneurial venture all the way up to the large, established multinational companies.

... with aid at record levels added to billions more in philanthropic funds, it is still dwarfed by the total amount of annual private international capital flows to Africa.

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Today, I will focus on what already-established businesses can do to advance Africa’s development through an economic philosophy I call Africapitalism, which centres on the private sector’s critical role in driving economic and social development across the continent. In this context, my focus will not be on the individual entrepreneur, but on what the large, established companies in Africa, or those planning to come in to Africa, can do to maximise the private sector’s development dividend. Currently, African and donor governments preoccupy themselves with developing the right aid programmes and the right level of spending in each sector to advance development – OECD countries aim to set aside 0.7 per cent of their national budgets for international development. On the Af- rican side, our African governments debate what percentage of their federal budgets to allocate to the various sectors of greatest social need – 5 per cent for health according to the Abuja Declaration and 10 per cent for agriculture according to the Maputo Declaration, for example. Governments are the key players in official aid flows, aided by philanthropies and non-profit service organisations. For example, last year, Africa received a total of $56 billion in Official Development Assistance (ODA), and a few billions more in philanthropic assistance – a new high water mark for total ODA to Africa in a single year. Howev- er, even with aid at record levels added to billions more in philanthropic funds, it is still dwarfed by the total amount of annual private international capital flows to Africa. Last year, Foreign Direct Investment (FDI) to Africa was $57 billion – a billion more than what we received in official bilateral and multilateral aid. When we combine re-

289 Tony Elumelu, CON mittances and intra-African investments with FDI, we are talking of nearly $200 billion in private capital a year and rising. This is already having an impact on development on the continent, but with a more deliberate effort to drive a new kind of private sector investment model, this could definitely have an even greater impact. My point is simple, we need to expand the pool of development actors and expand our development mechanisms to enable all actors to participate in a way that is congruent with the way they naturally function. Large national and multi-national companies across Africa – both African and foreign owned – are creating hundreds of thousands of jobs, in multiple countries, and integrating the continent more and more each day. According to a World Bank study, Africa’s private sector accounts for about two-thirds of total investments, four-fifths of total consumption, and three-quarters of total credit on the continent. This all adds up to increased development based on economic opportunity. The private sector needs to be recognised and charged with being a key player in not just Africa’s development, generally, but Africa’s development agenda, deliberately, and specifically. This is what I have been preaching – I call this Africapitalism. Africapitalism is an economic philosophy that promotes long-term investment in strategic sectors that will create economic and social wealth, that is, financial returns for shareholders as well as social dividends for society. Although Africa received a record amount of FDI last year, a recent article in the Financial Times estimates that one-third of that investment still flowed into extractive based projects. This is why Africapitalism as an approach is so impor-

290 Africa Speaks: A Collection of Speeches tant to Africa’s economic and social future. In practice, Afri- capitalism advocates for more local value creation instead of the extraction model – intra-African trade and investment, regional integration, and the development of local human capital and other capacities to drive Africa forward. As part of the global effort to reconsider the role of business in society, there are a number of movements with similar aims like Af- ricapitalism. One of which I am a member and supporter is called Inclusive Capitalism, championed by Tony Elumelu Foundation Advisory Board Member, Lady Lynn de Roth- schild and McKinsey Managing Director, Dominic Barton. Inclusive capitalism is, of course, like the capitalism you know, but a version in which the benefits are more widely shared by all. Professor Michael Porter of Harvard Business School and founding patron of the Tony Elumelu Founda- tion promotes the concept of “shared value”, which is the belief that the competitiveness of a company and the health of the communities around it are mutually dependent. Dr Jim Kim, President of the World Bank, talks about “shared prosperity”, which is the necessity of achieving broad-based economic growth that permeates all levels of society, not just a small elite subset, as is usually the case with commodity-dependent economies. Africapitalism brings these three concepts together because Africapitalism is “shared purpose”. Africapitalism therefore means we cannot leave the business of development up to our governments, donor countries and philanthropic organisations alone. The private sector must be involved in the business of development. The African private sector must wake up, recognise and embrace our role in driving the economic growth and the social de-

291 Tony Elumelu, CON velopment of Africa, and we must act on that responsibility in tangible ways. We must do this not only through philanthropy and the CSR practices that have been inherited from western companies, but by the way we run our businesses and the types of investment choices we make. As we strive for greater financial returns, the development dividend must be part of the strategic calculations we make. And we must think in the long-term because the kinds of challenges we face on the continent require not only vision but also patience and perseverance. I am the chairman of Heirs Holdings, and we practice what we preach. As a pan-African company, we invest in the key strategic sectors of power, oil and gas, financial services, real estate and hospitality, agriculture, and healthcare – all for the long-term, and with an aim of creating value within our own economies. Let me share with you my personal experience of how the practice of Africapitalism in three sectors – financial services, energy/power and agriculture – has buttressed my belief that private companies do indeed create financial and social impact in their chosen sectors and geographies. In 1997, my partners and I took over the shuttered Crystal Bank and rebranded it in to Standard Trust Bank (STB). We were small, but out-performing most of the other banks in Ni- geria across a variety of metrics. We achieved unprecedented growth through innovation and by pursuing down-market customers who had not previously had bank accounts. This approach fuelled an amazing growth trajectory for the bank, but also helped create a culture of responsibility and accountability, facilitated payments, and opened up access to credit for tens of thousands of financially disenfranchised Nigerians.

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…we need to expand the pool of development actors and expand our development mechanisms to enable all actors to participate in a way that is congruent with the way they naturally function.

Though economic profit was our primary motivation, we democratised access to banking first in Nigeria, and then across Africa in the process. This had a formidable impact on my understanding of how a business, even in pursuit of profit can simultaneously deliver a meaningful social return as well. The success of STB allowed us to merge with the much larger United Bank for Africa (UBA) in 2005. How- ever, we had the vision of expanding financial inclusion beyond Nigeria and facilitating intra-African transactions, so we opened bank subsidiaries in eighteen other countries across Africa, often allowing customers in some previously underbanked economies to open bank accounts with zero balance. That strategic calculation to be patient and democratise access to banking services has paid off. Today the United Bank for Africa has over seven million customers in nineteen African countries supported by over twenty thousand. And through our financial platforms and transactions, we are facilitating regional integration and development. For our pan-African growth strategy – this was part of the equation – the social impact that would be created through a pan-Afri-

293 Tony Elumelu, CON can financial institution was something we were aiming for. The story is documented for you all to read in an up- coming publication called Africans Investing in Africa that was co-funded by the Tony Elumelu Foundation and the Op- penheimer Family’s Brenthurst Foundation, and includes an introduction by Oxford’s own Professor Paul Collier. Making financial services available to the unbanked in Ni- geria and across Africa, that is shared purpose; that is Afri- capitalism. In the power sector, Heirs Holdings recognised that over half of Nigeria’s population of one hundred and seventy million people lacks access to power. As a country, we only generate 10 per cent of the 40,000MW our economy needs to meet our basic domestic consumption needs. So, our subsidiary, Transcorp, acquired a plant that was producing only 160MW of its 1,000MW capacity under government control, and doubled the output within four months of taking over ownership in November 2013. The plant now operates at 610MW, and we are currently upgrading and expanding the plant to generate 2,000MW with partners like GE. Our ambition is to generate 25 per cent of the country’s power supply, regardless of total generating capacity in the nation. We made this investment with the intent of realising profit for our shareholders, but also to unlock other economic opportunities, like new businesses and expansions which create new jobs – all of which will come as a result of reliable and affordable access-to-power and lower operating costs. We know megawatts on the grid, means more electricity for homes, hospitals, businesses, and very importantly, more homework at night. And we are doing it within the framework of the national power plan. So what is good for

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Heirs Holdings is good for Nigeria and her citizens. That is shared purpose; that is Africapitalism. The last experience I will share is in the agriculture sector, which is a strategic sector in just about any African country, though unfortunately normally treated as a social sector rather than one with real business opportunities. We know that 70 per cent of employed people in Africa work in the agriculture sector, and agriculture accounts for about 30 per cent of the GDP of most African countries. Yet, our farmers who provide the sustenance that fuel our bodies, our creativity and our economies, are among the poorest among us. With the recognition that 50 per cent of the population gains by 2050 will come from Africa and that the AU member countries have prioritised the agriculture sector, my company invested along with Nicholas Berg- gruen, an American investor, in Africa Exchange Holdings (AFEX) to establish commodity exchanges in key markets across Africa. We started with the East Africa Exchange (EAX) in Rwanda, leveraging the amazing enabling environment put in place by President Kagame and his team, and then expanded to Nigeria where we recently became the first private company to secure a commodities exchange licence. We are planning to expand to Kenya, Uganda, and Tanzania over the next few months. AFEX and EAX place our smallholder farmers at the centre of our business model because they are the most critical factors in any food security strategy in Africa. Our model was to create commercial platforms that will help farmers to reduce post-harvest losses through warehousing. Give them access to multiple and competing buyers in more markets. Provide farmers with access to credit and financial products,

295 Tony Elumelu, CON making them bankable; and giving manufacturers a reliable supply of raw materials and quality assurance. Thus, our activities also stimulate the financial services and manufacturing industries, and we are doing it by treating agriculture as a business, not a welfare programme, and by treating small farmers as business partners, not charity cases. The overall effect of this business model is to increase farmer incomes in a far more sustainable manner than any aid programme, transform their lives and communities, and promote food security and rural economic transformation across Africa. Another example from outside the Heirs Holdings Group is that of Dangote Industries. This company used to be the largest importer of cement and numerous other basic commodities in Nigeria. However, since they converted their operations to local manufacturing and began creating significant local value, they have not only grown to become the biggest company listed on the Nigerian Stock Exchange, creating thousands of jobs in Nigeria, but their model has increased demand for their product and they are now operating in six different African countries. That is shared purpose; that is Africapitalism. The beauty of Africapitalism is that it is not restricted to only indigenous African businesses, though as African business leaders we must set the example for others to follow. Some multinationals have already followed this path in Africa. I recently heard about a case study of two multinational FMCG companies in Nigeria, who thirty years ago had roughly equal market share. One of the companies invested significantly in local manufacturing and linking to domestic supply chains, while the other maintained an

296 Africa Speaks: A Collection of Speeches import driven model. The company that invested locally is now seven times the size of the one that did not, and the laggard company is now struggling to catch up. Why? You guessed it: investing in local manufacturing and linking to local supply chains. Africapitalism is really the way in which all existing and future local and foreign investors can and should develop their investment plans for Africa. They must separate themselves from the traditional investors who have collectively extracted trillions of dollars’ worth of riches from beneath the African soil, or grown in the African soil, while delivering little to no enduring tangible opportunities for the economic advancement of the millions living on the surface. To be clear, the shared purpose inherent in Africapital- ism does not absolve governments of their role in advancing development. In fact, it means everyone has a role – business, government, philanthropies, NGOs, and multilateral institutions alike. Africapitalism is the nexus between the ability of the private sector to create value and the government’s creation of a business-friendly environment. These

According to a World Bank study, Africa’s private sector accounts for about two- thirds of total investments, four-fifths of total consumption, and three-quarters of total credit on the continent. This all adds up to increased development based on economic opportunity.

297 Tony Elumelu, CON two roles have become further intertwined and even mutually dependent and mutually reinforcing to create an equita- ble, inclusive, and prosperous Africa. Now I want to talk about how companies can recreate this virtuous cycle of development through economic empowerment. Many companies, particularly those in commodity-dependent economies, need to redouble their efforts to incorporate emerging local entrepreneurs into the value chain of their businesses. This not only helps to create jobs and build local capacity, it also helps to insulate their businesses from breaks in their supply chain caused by external shocks. For instance, Coca-Cola pursued a concerted strategy of sourcing juice concentrate and other raw material for its beverages in local markets across Africa. This is creating opportunities for local fruit growers, aggregators, and transporters while also supporting local agri-processing and the local beverage industry. It has helped create entire supply chains of entrepreneurs where there was formerly none. I am proud to say that Transcorp’s agribusiness subsidiary, Teragro, the first company in Nigeria to process our abundant oranges, pineapples, and mangos into concentrate, is the most recent addition to the Coca Cola local supply chain in Africa. Coca-Cola, Transcorp, and Dangote Cement’s activities are examples of local value creation, a key pillar of Africapi- talism. Companies that incorporate local value creation will be more sustainable and profitable in Africa in the long- term. In addition, by investing in local economies and creating local jobs, they are also increasing the pool of those who

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We must think in the long-term because the kinds of challenges we face on the continent require not only vision but also patience and perseverance.

can afford their products and services. Africapitalism is a call-to-action for businesses to make decisions that will increase economic and social wealth, and promote development in the communities and nations in which they operate. Such a decision will ultimately help businesses become more profitable as the communities they serve become well-off consumers, healthy and better educated employees, and even entrepreneurs who go on to become suppliers, service providers, and consumers. As students who will soon enter the workforce, your generation is more conscious of the way in which business is conducted than any other generation before you. This is expected considering you live in a time when the earth’s population is stretching our resources to the limit, and when income inequality is more pronounced than ever. If you do not care about how business is conducted your futures may be at stake. What kind of employer do you want to be? One that maximises short-term profits by taking the shortest route to profitability, uncaring or sometimes even to the detriment of the local community? Or one that takes a long-term view and practices patience in the pursuit of profits while build-

299 Tony Elumelu, CON ing up the capacity of the community? As consumers, whom would you want to buy your products from? As investors, whom would you want to invest your capital in? Africapitalism’s call-to-action is to use your power as individuals – employees, employers, investors, and consumers, leaders in the public, private and social sectors – to support the kind of business practices that lift up society whilst making profits. You are the world’s future leaders and the most important determinant of Africapitalism’s success or failure can be boiled down to that single, but complex imperative – leadership. A true leader is one who remains committed to a higher purpose that most people do not yet see. The old business model of a myopic pursuit of profit above all else is at best imprudent and, at worst, reckless in our increasingly inter- connected and interdependent world. As future leaders, you must therefore shape how businesses need to change in order to address the complex challenges of the twenty-first century, not just for Africa, but also for the entire world. It would not be easy, but nothing worth having ever is. Thank you.

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The Future

“I will reach out to partners to join hands with me to make sure that Africa has a future generation of business leaders across all levels.”

– Tony Elumelu, CON

Africa Speaks: A Collection of Speeches

Tear Down These Walls

Speech delivered at The 2012 Future Awards, Cross River State, Nigeria 26 August 2012

303 Tony Elumelu, CON

Impossibility is often a myth advocated by people who are afraid to stretch themselves.

– Tony Elumelu, CON

304 ood afternoon everyone. I would like to thank the organisers of the Fu- Gture Awards for inviting me to speak at this special event. My speaking engagement today has generated so much buzz and attention, which indeed attest to your depth in the social media arena. I also would like to congratulate everyone in the audience today. It is a great time to be a young person in Nigeria, and indeed Africa. Tear down these walls. Today’s youth are fired up. Once in a while, my children sing a new song, or talk about a new book or a new show that has been produced by a young person and I would say, “Wow, that is great.” You all have access now to the Internet, to resources that your parents never had. You have life coaches and motiva- tional speakers and inspirational religious leaders. You have music acts breaking barriers across the continent, and social technology entrepreneurs creating hubs for innovation around the country. Is there fire? Yes. Is there zeal? Yes. Are there great ideas? Absolutely. Do we have entrepreneurs with ideas that can change the face of our nation? Yes. But what is the point of all this, if we have barriers standing in our way? All my life, I have had to face walls and tear them down with passion. Let me tell you the story of a few young people who had an idea with barriers in their way. In 1997, a few of us decided

305 Tony Elumelu, CON to acquire a bank that was distressed and commenced on the journey to turn around this bank. So what were the barriers here? Some would say our age. We were just a few years older than many of the awards nominees here tonight. We were then called cowboys and all sorts of other names. Also, we did not have all the money we needed. So we did at the time what is called today a “debt-equity swap” amongst other initiatives and through these initiatives, we were able to acquire the bank. What do I mean? The bank had depositors they owed, and so we approached the depositors and got them to convert their deposits into equity. Some converted and kept in their names. Some said, “No, we have no confidence in this group. If you can take over our liabilities and pay us over two or three years, we are fine, but we don’t want to leave our deposits in this bank.” Through this process, we were able to acquire a significant stake in the bank. Next thing we did was to engage a few more key staff to support the process, and from five branches over a period of seven years, we had grown the bank to a hundred branches and become the first bank in the country with the highest branch network to be integrated, online-real time. You could enter any branch of Standard Trust Bank and transact across the country. Things started changing. A wall had been broken. However, in 2004 we concluded a transaction where the fifth biggest bank in the country, Standard Trust Bank, and the third biggest bank, United Bank for Africa came together. But as you know, in all mergers there is almost always an acquisition. Standard Trust had acquired a strategic interest, about thirty-three per cent of UBA and then merged. That

306 Africa Speaks: A Collection of Speeches was how, in 2005, the merger occurred and we automatically became the number one bank in the country. At this time, in 2005, UBA had four hundred and twenty-eight branches across the country, and we wanted to be the leading bank in the country, so we defined the parameters again – deposits, customer base, branch network, ATM machines, portability, etc. We crafted our intent to be number one in Nigeria in the first year; two, to be one of the leading pan-African banks and three, an African bank with global presence. In a period of four years, we had grown a network of seven hundred branches across the country, fully integrated the bank, had ATM machines in excess of three thousand across the country, had rapidly grown our customer base and were offering good products to our customers. But the second-tier intent, to grow a pan-African bank, was yet to start. We commenced that journey and within a period of five years, we were able to grow the new UBA into a pan-Afri- can bank with presence today in twenty countries, including Kenya, across Africa. This is the story of an African institution that has grown from a one-country institution into a pan-African one. Now we are working on tearing down the walls between investment and philanthropy. Our mission is guided by our philosophy, Africapitalism, a private sector commitment to the economic transformation of Africa through long-term investments that create both economic prosperity and social wealth. Emphasising the social impact of investments, when we started the bank, we made money, but at the same time, our social impact was great in terms of job creation, ease of doing business,, etc. I realised at that time that you can do well while doing good. This forms a part of my philosophy

307 Tony Elumelu, CON today, and is one of the reasons I established The Tony Elu- melu Foundation, which celebrates excellence in business leadership and entrepreneurship across the continent. The foundation is helping a largely neglected pool of entrepreneurs emerge with great ideas – we are collaborating with techies at CcHub. Through the partnership, TEF will contribute to the growth and development of Nigeria’s emerging tech industry from the “Silicon Lagoon” by providing managed seed funding to twenty technological ideas/ventures targeted at typical social challenges faced by the average Nigerian. The fund will support the novel use of technology in several key areas of the economy including healthcare, education, agriculture, governance, including technology, small business development, and finance. By focusing on the early stages of high-impact, results-oriented ideas/ventures, the seed funding will support experimenta- tion and prototype development in order to accelerate the adoption of the solutions. Each technology venture will then have the potential to become a self-sustaining profitable social enterprise. We are also helping to cultivate Africa’s next generation of C-Suites through our African Markets Internship Pro- gramme (AMIP). Twenty-eight AMIP associates from across the continent and around the world shared their knowledge and received invaluable hands-on experience at fast-growing African companies in Abuja and Lagos, Nigeria; Accra, Ghana; Douala, Cameroon; Kigali, Rwanda; Lusaka, Zam- bia; and Nairobi, Kenya. The associates are natives of several countries including Nigeria, Togo, Ghana, Sierra Leone, Ja- pan, China, India, Ukraine, Denmark, Ethiopia, Cameroon, the United Kingdom, Colombia, and the United States.

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Is there fire? Yes. Is there zeal? Yes. Are there great ideas? Absolutely. Do we have entrepreneurs with ideas that can change the face of our nation? Yes. But what is the point of all this, if we have barriers standing in our way?

Launched in 2011, AMIP’s goal is twofold: improving the competitiveness of Africa’s high-growth private sector businesses while introducing some of the world’s brightest young business talent to executive suites across Africa. Do not be afraid to dream. Think Big by Dr Carson and Outliers by Malcolm Gladwell are some of my favourite books and recommended for you. Young people must not feel entitled. The world does not owe you anything. You must strive to conquer. Young women, do not let your gender hold you back. Women like Oby Ezekwesili and Ngozi Okonjo-Iweala are doing phenomenal things in the world. Do not let anybody tell you that being female is a handicap or barrier. There is a lot of value in working hard, not just working smart. Bridge those gaps that exist in society and make yourself and the society better in the process. Build consensus but do not be afraid to strike out on your own. Impossibility is often a myth advocated by people who are afraid to stretch themselves. An example is the Novo Nordisk Energy case study. A new CEO of NNE, a Dan- ish construction company, took his firm from building new plants in thirty to thirty-six months to building them in less than twelve months. Young Nigerians (and Africans) have

309 Tony Elumelu, CON the advantage of technology. You have used it to break down social barriers, protest injustice and even bring down governments. Technology has also helped support worthy causes. Young people are now using social media to remove the barriers hindering access. You all are present on different platforms – Twitter, Facebook and LinkedIn. The Tony Elumelu Foundation is present on all those platforms as well as on Flickr, YouTube and SlideShare. The Tony Elumelu Foundation is solidly focused on boosting the Africapitalism ethos through its different projects: its leadership development, African Management Initiative (AMIP); in policy advocacy, the Competitiveness Council, BEFP, African Public Sector Competitiveness Programme, and Charities Bill. In impact investment, Mtanga, Nigerian Agriculture Fund, and venture incubation pipeline. If you would like to read more about my journey, you can find the electronic copy of Power of Vision, a collection of tributes that was published when I retired from UBA. In the stories of my friends and colleagues, you will learn more about how we achieved all that we did. Also, I would like to take this opportunity to announce that I will be conducting a monthly question and answer session on Twitter using the hashtag #TOETalks. It will start at 2 p.m. on the first Saturday of every month and last for an hour. I know I would not be able to answer everyone’s questions here, so I encourage you to please join me on Twitter starting 1 September. Again, I want to wish you all the best as you set forth to tear down the walls that exist in our space, and thank you for listening.

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A Call to Partner with Africa.

Speech delivered at The Corporate Council on Africa’s Opening Plenary during the African Leaders Summit, Washington, D.C. 4 August 2014

311 Tony Elumelu, CON

Africans in the diaspora see their home countries as places of opportunity and destination for prosperity. In business, we call that an Africapitalist awakening.

– Tony Elumelu, CON

312 hank you all for being here. I am honoured to be here with all of you and to open for President Kik- Twete of Tanzania. I want to start by thanking my good friend and business partner Paul Hinks, the president of symbion Power and chairman of the Corporate Council of Africa (CCA), as well as Steve Hayes, Ambassador Robert Perry and the wonderful staff at the CCA for organising a robust programme of events to augment the official African Leaders Summit, being hosted here in Washington D.C., by President Obama. I also want to thank President Obama and his hardworking team for hosting this summit. It sends a way over- due signal that the African continent is of significant interest to the United States. And by inviting the African business sector, they are also explicitly recognising that Africa is of economic interest to the United States. Most importantly to me, they recognise that there is in fact a growing and thriving business sector on the continent that is capable of partnering with the US business sector for mutual economic benefit. And this is vital, because it is important to understand the Africa that will be represented in D.C., this week and going forward. Africa has always been of strategic importance to the US and other regions. For centuries, the relationship between other continents and Africa has been one of extraction, and in a lot of cases, one of exploitation. Most of the world has

313 Tony Elumelu, CON depended on us one way or another for labour, energy, met- als, minerals, fuel, food and other essential elements needed to power their economies. We learned to depend on expen- sive imports from other countries. Even more destructively, we learned to depend on aid from other countries that is a small percentage of the value of the natural resources we sold for very little. But something happened in the 1990s. As the cold war ended, the West lost interest in buying the loyalties of developing countries, and the population lost patience with authoritarian regimes, and there was a growing consciousness on the continent that we needed to find “African solutions to African problems”. Then what began to emerge was the entrepreneurial class – enabled by incremental reforms instituted by democratic governments that are still on-going – an entrepreneurial class that recognised that no one but us will ultimately develop Africa; that Africa has potential as a market for goods and services that no one else seemed to have confidence in. Hence, this entrepreneurial class of Africans built a telecoms sector, a film sector, and a financial services sector where the African middle class stepped up as consumers,

Africa reclaims more of its brains in the form of the diaspora who are educated and trained in the United States and other developed countries, bringing their expertise, innovation and capital to the homelands of their parents and ancestors.

314 Africa Speaks: A Collection of Speeches employees and managers. In Nigeria alone, that has resulted in a $300 billion expansion in our national economy. Fast forward to the last five years, the rising BRIC countries have also begun to compete with the US and European countries for resources from Africa, even as we seek to uti- lise those resources for ourselves. As some of the world’s largest economies struggled with an epic crisis, several Af- rican economies have continued to grow, and four of the top ten fastest growing economies are African countries. We all share in the pride of Mozambique, Nigeria, Ghana and Rwanda. We are witnessing a steady reversal of the brain drain crisis every day. Africa reclaims more of its brains in the diaspora, who are educated and trained in the United States and other developed countries, bringing their expertise, innovation and capital to the homelands of their parents and ancestors. This is particularly significant because previously, diaspora remittances of up to $40 billion annually were helping to keep African economies afloat. Now these same Africans in the diaspora see their home countries as places of opportunity and destination for prosperity. In business, we call that an Africapitalist awakening. Fast forward to this very day. A crowd of African political and business leaders have arrived at Washington. This time however, we come not with cap in hand, but wearing our confidence and our competence, defined by proven success on the continent, and by any global standard. We come having commenced on the journey towards intra-regional trade and investment, and integration. Ugandans are making calls from our South African MTN networks. Beninese and Togolese citizens are building their homes and offices

315 Tony Elumelu, CON with Dangote cement, made in Nigeria. And Nigeria’s UBA provides financial services to Senegalese, Kenyan and Mo- zambican citizens, along with over seven million Africans in nineteen nations. Lastly, we come to seek American partners who will share our goal of long-term investments that create local value and social wealth. This is what I call Africapital- ism. We know that sectors such as agriculture, textiles and power will have multiplier effects of creating jobs and economic stability, and we know with the injection of capital and technology tailored for the environment, they will generate huge returns, for our people and foreign investors as well. Regardless of whether you are part of the meetings in the Mandarin Hotel or at the White House, by adopting an Africapitalist approach, you too can be a part of a new US-Africa relationship that generates value for investment and yields economic and social value on the continent. In closing, I want to address the question on everyone’s mind – how we measure the success of this summit. As I said in a piece that was published in the Wall Street Journal last Friday, the success of this summit will be defined not by who attends, but by what we can agree to achieve, going forward, together. This summit is only the beginning, and America has ways to catch up with the competition from China, Europe and the BRICS to partner with Africa. But this is the country that gave to the world the automobile, the aeroplane, electricity, Bill Gates, anti-retroviral, Michael Jackson and iPads. I will always bet on America – smart Americans know it is time to bet on Africa.

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Changing the Narrative on Africa in a Changing Administration

Speech delivered at the Opportunity Africa Conference, Delaware, USA 16 September 2016

317 Tony Elumelu, CON

Success is happening in Africa. Opportunity is happening in Africa. And I am living proof of this.

– Tony Elumelu, CON

318 S Senator Christopher Coons; former State Rep- resentative, Don Blakey; distinguished speakers Uand guests; ladies and gentlemen. I am delighted to be with you this morning for the fifth Opportunity Africa Conference. I would like to start by thanking Senator Chris Coons and his wonderful staff for inviting me to his home state to speak with his constituents. I have met with Senator Coons in Washington, but nothing speaks more warmly of friend- ship than an invitation to one’s home. I also want to thank you, Senator for your commitment to the continent and people of Africa. I will start by saying that on the surface, Senator Coons and I appear very different. He was born and raised in the United States, and I, in Nigeria. He has spent many years as a public sector leader, while my career has been, almost exclusively, in the private sector. And we have both achieved much success in our chosen endeavours. However, if you look more closely, we are not so different. We were both born in 1963. And we share a deep belief in the inherent value and dignity of the African people and a commitment to deliberately and unapologetically, unlock the potential of the continent. The senator’s interest in Africa began as a student when he wrote critically about the Apartheid government in South Africa and the unfortunate US foreign policy of “Construc-

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I was I was born in Africa, educated in Africa and worked in Africa for my entire career. You might say that I was made in Africa and I made it in Africa.

tive Engagement” with the racist government, and through his experiences living in Kenya. Both of these experiences influenced how he approached the concept of governance even in the United States itself, and caused him to change his political affiliation. So, Africa changed you, senator, in a fundamental way, and now you are paying it forward by using your distinguished and elevated platform in the US Senate to help change Africa and the narrative about Africa. So a key theme in the senator’s life has been “change”. In my life, the key theme has been “made”. I was born in Africa, educated and worked for my entire career in Africa. You might say that I was made in Africa and I made it in Africa. And like the good Senator, I seek to change the narrative about Africa from one of underdevelopment and overwhelming poverty to one of opportunity and prosperity. For too long and for many people, the continent “Africa,” has evoked images of poverty, disease, hunger and backwardness. Even worse these images conjure a sense of hopelessness. People believed similar things about China, Brazil and India not too long ago, but now that these countries are economic powerhouses, the narrative has changed. We now call

320 Africa Speaks: A Collection of Speeches them BRICS, or emerging markets. Senator Coons and I believe everyone here wants the same for Africa’s fifty-four countries. Yet it is true that, today, Africa is home to two thirds of the world’s HIV/AIDs infected persons and 90 per cent of its orphans; ninety million kids who are out of school; over a dozen undemocratic or partially democratic governments; millions of people who are caught in civil conflicts and vulnerable to starvation. They are all true, and these are critical development challenges and in many cases, failures that we must own up to. But that is not the whole story about Africa. Africa is the cradle of mankind and ancient civilisations; it is the home of amazing modern music, art, language culture and film; it is the home of the late great Nelson Mandela; it is the source of cocoa the primary ingredient in candy, which brings smiles to the faces of your children and terror to the hearts of your dentists; and it is the source of tantalum, without which your smartphones cannot run, and most important to me, Africa is a continent of young budding entrepreneurs. Africa is also the home of a young and growing middle-class that has strong purchasing power – a middle-class that likes baseball caps, iPhones, CNN and Beyonce. In other words, in Africa lies a huge growing market for American products. Clearly, over the last two decades, something has been happening in Africa. Success is happening in Africa. Opportunity is happening in Africa, and I am living proof of this. I have enjoyed success in banking, agriculture, real estate, hospitality, healthcare, power, oil and gas, etc. I have been very successful in these sectors using an economic philosophy I developed called Africapitalism, which advocates

321 Tony Elumelu, CON long-term investments in strategic sectors that generate both economic dividends for investors and social dividends for society. So, I am a successful Africapitalist today, but I started out just like one of those young men and women in the clip you just saw of the beneficiaries of the Tony Elumelu Foun- dation’s $100 million Entrepreneurship Programme. The continent of Africa has given me so much. And I understand and embrace the responsibility to give back to the continent by paying it forward and creating more Tony Elumelus to help transform Africa. Through the Tony Elumelu Foundation’s $100 million Entrepreneurship Programme, we seek to institutionalise luck and democratise opportunity by giving every budding or aspiring African entrepreneur the chance to benefit from it. It is open to all African citizens, regardless of age, gender, nationality or commercial sector. We plan to train, mentor and seed ten thousand African businesses over the next ten years, create one million new jobs and $10 billion in additional revenue across Africa in an effort to ignite the economic transformation of Africa. These entrepreneurs will achieve financial success while creating home-grown solutions to local problems in core areas such as food, education, health, water and sanitation, etc.; therefore, delivering African solutions to African problems – in other words helping to implement the Sus- tainable Development Goals from the private sector. This is the story I want to tell about Africa. This is the new narrative of Africa. I travel all over the world, preaching that Africa is “opportunity”. And if I am the opportunity preacher then Senator Coons is the choirmaster because for

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Clearly, over last two decades, something has been happening in Africa. Success is happening in Africa. Opportunity is happening in Africa. And I am living proof of this.

the last five years, he has been organising this conference that could not be more aptly named and reflective of what is happening on the continent “Opportunity Africa”. He is not only bringing that message to Delaware, he is taking it to Washington D.C. And he is demonstrating it through concrete policy actions. In truth, US policy towards Africa has largely and steadily been improving since the late 1990s. It has not been perfect, but it has gotten better with each successive president since William Jefferson Clinton. Looking back, from the 1960s through most of the 1980s, US Foreign policy towards Africa amounted to supporting despots for Cold War alliances and then, following the collapse of the Soviet empire, wrote Africa off completely in the 1990s. However, during his second term in the late 1990s, President Clinton began to engage with the continent and even came on a state visit to sub-Saharan Africa, something no US President had done in almost two decades. It was also in the final year of the Clinton presidency that the Africa Growth and Opportunity Act was passed, which helped to lay the foundation for a new US-Africa

323 Tony Elumelu, CON relationship; one based not on humanitarian assistance, but on partnership for mutual economic benefit, and one that allows entrepreneurship to be the engine of social development. President George W. Bush built on this with the AGOA renewals and enhancements and the creation of the Millen- nium Challenge Account, which was a multi-billion dollar programme to incentivise African countries to embrace democratic reforms and govern justly, in return for US assistance in developing their infrastructure and commercial sectors. Bush must also be credited for the multi-billion global AIDS programme that has helped to keep millions of HIV-infected people healthy, and by extension Africa’s workforce and economies healthy. President Barack Obama upheld the previous initiatives and created the Feed the Future Global Food security programme to boost agriculture in twenty countries; a sector that delivers three times the development gains as any other investment in development. Also, he created the Power Africa initiative, which seeks to expand access to electricity for the six hundred million Africans who lack access today,

…If we get power right in Africa, it will unlock millions of new jobs and economic growth is multiple sectors by reducing the cost of doing business and attracting new investments.

324 Africa Speaks: A Collection of Speeches through public and private sector partnerships, an agenda that Senator Coons championed to preserve through pas- sage of the Electrify Africa Act in the US Senate. And it had leveraged nearly $150 billion in private capital to address this critical development issues. That is what I call “shared purpose”, a key characteristic of Africapitalism. And I know that if we get power right in Africa, it will unlock millions of new jobs and economic growth is multiple sectors by reducing the cost of doing business and attracting new investments. So, US policy towards Africa over the last two decades has been improving, regardless of which party has held the presidency. As you go into your presi- dential elections this year, I urge Americans to ensure that the candidates and new administration seek to build on this progress. Both candidates are promising change in key policy areas, especially in the foreign policy arena. But I want to say to you today, that some things don’t need to change. What they need is to be expanded and scaled up. In other words, we need more US engagement in Africa through mutually beneficial trade and investment. Incidentally, that is exactly what I, and two hundred other US and African political and business leaders, will be discussing next week at the US-Africa Business Forum in New York on how to strengthen mutually beneficial economic ties between the African and American peoples. We also need more security cooperation that protects both Americans and Africans from the undesirable elements of this world. Importantly, we need to work in “shared purpose” on complex solutions to complex challenges in Africa. So when you meet, write, call and email your political

325 Tony Elumelu, CON candidates and representatives, in all races, and those elected in November, tell them that when it comes to Africa, you want “more” – more engagement, more positively impactful policies and more development and commercial investment in Africa. In closing, I want to thank you all for coming out today to explore and further opportunity in Africa. I am an unashamed optimist and I believe that working together, in “shared purpose”, we can help usher in economic transformation that will catapult Africa into a strong regional player in the twenty-first’s century global economy. Going back to the defining themes that illustrate the impact that Africa has had on Senator Coons and myself, I believe that we will collectively be able to look back in 2030, and know that while Africa “made us” or “changed us,” together we “made change” happen in Africa and for Africans, through a virtuous cycle of opportunity and prosperity.

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Leadership and Entrepreneurship: The Challenges and Opportunities for Nigeria’s Future Leaders

Speech delivered at 1st Distinguished Speaker Series, Lagos State University, Ojo, Lagos, Nigeria 16 November 2016

327 Tony Elumelu, CON

Years from now, I believe that my legacy will not be defined by my material successes … but by this unwavering commitment to developing and strengthening African entrepreneurship. This is what will stand the test of time.

– Tony Elumelu, CON

328 am delighted to be here with you all today at Lagos state University. I am especially honoured to be invited to the Ifirst of your Distinguished Speaker Series and wish you more informative and enlightening sessions down the line that will enrich your minds and broaden your outlook. Before I get into the core of my remarks; I want to say that there is no greater gift to the world than to pass on knowledge. On this note, students, I want you all to join me in a standing ovation for your university leadership, faculty, your teachers and non-academic staff, for all their efforts to impart essential skills and knowledge that will serve and enrich your lives and careers for a lifetime after leaving the university. My name is Tony Elumelu. I come wearing two hats as the chairman of the United Bank of Africa (UBA), a pan-African financial services institution across nineteen Af- rican countries, London, Paris and New York, and founder of the Tony Elumelu Foundation, which has just recently hosted one thousand African entrepreneurs from fifty-four countries in the second edition of the Tony Elumelu Entre- preneurship Programme, also known as the largest annual gathering of African entrepreneurs in the world. I am also here as a proud resident of Lagos state, and strong supporter of all its institutions and inhabitants. I was asked by your university leadership and faculty to speak to you about entrepreneurship and the yet to be tapped possi-

329 Tony Elumelu, CON bilities that it can unlock for communities, cities, countries and our continent. After watching the Tony Elumelu Foundation documentary, I am sure you have all noted my deep passion for empowering young entrepreneurs across the continent. Years from now, I believe that my legacy will not be defined by my material successes and what my bank account may boast, but by this unwavering commitment to developing and strengthening African entrepreneurship. This is what will stand the test of time. However, it is incumbent on me to speak to you about leadership first. You are the future leaders of Lagos, Nigeria and even Africa. Some of you seated here today, short years from now, will take up influential positions that demand first-rate leadership skills. So, I have titled my speech, Leadership and Entrepre- neurship: The Challenges and Opportunities for Nigeria’s Future Leaders. I will start by defining leadership, then I will speak about the challenges of leadership in Africa; and finally, the opportunities or how we go about resolving this leadership challenge and what it could mean for the continent. A leader can be summed up as someone who gets results. Therefore, I believe you can be a leader at any stage in your life and career, and in any career path you choose. Whether you are leading a team of people, or just yourself, your responsibility is to generate, secure or deliver results, and students of this great institution have critical roles to play, whether you are a member of the Student Government Council or not. You are all young leaders privileged to pursue your academic and career endeavours at one of the finest universities in the country. You must challenge yourselves

330 Africa Speaks: A Collection of Speeches every day on how you can contribute to building the LASU reputation, and how you can positively influence your class- mates and schoolmates to do the same. I also believe, and this is good news for those who do not feel that leadership is an innate quality they possess; rather, that leadership is learned. Some may be born leaders, but for most, leadership is learned. And you can always be a better leader. So, it is important to keep developing your leadership skills throughout your career. I can tell you that I am still working on myself, and that is why I continue to show up for select leadership seminars because I always learn something new. Continuous learning is a must for leaders. Some ways of continuously learning leadership skills throughout your career include: Treating challenging situations, both good and bad, as learning opportunities, attending events such as this one and listening first-hand about the experiences of others and; observing and shadowing leaders who are transformational, and learning how they do it. When it comes to Africa, I think of the continent as a collection of organisational units called countries. When a unit or country does better, the continent does better, and when a unit does better, it can help to inspire the improvement of the functions of related units. Africa has one billion people, fifty-four countries and thousands of languages and cultures. What we share is one common aspiration – development. We would all like to see the continent take its rightful place in the global economy as a strong regional player. Leadership is key in achieving this because leadership sets direction and leadership mobilises for results. I want to highlight three leadership challenges in Africa that really constrain our development progress. First is the fact that

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Some ways of continuously learning leadership skills throughout your career include: Treating challenging situations, both good and bad, as learning opportunities, attending events such as this one and listening first hand about the experiences of others and; observing and shadowing leaders who are transformational, and learning how they do it.

lifetime leadership does not equal lifetime achievement. Africa has long suffered from the “President for Life” syndrome. In the 1960s and 1970s, post-independence era, a group of leaders assumed office and many stayed in office for twenty, thirty and even forty years. They include Mobu- tu Sese Seko, Muammar Ghaddafi, Conte in Guinea, and there are several others with extended tenures in power today. To stay in office that long, you have to be “Strong Man”. This is not the same as being a strong leader. The effect of this is that power is concentrated at the top. If you need power to maintain your leadership role, then you will have little room for dissenting ideas, and leadership requires the ability to listen to new and diverse ideas and opinions to be able to select the best ones to guide your team, organisation or nation. So when our political leaders spend twenty to forty years sacrificing ideas to maintain power, they are sacrificing our development aspirations and our futures.

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The second is the issue of defining and confining leadership to the top strata. For too long, Africans have understood leadership only as a function of people at the top of the chain, that means only the principal, head of department, the vice chancellor, the chief executive officer or chairman, the minister or the president are considered leaders. Therefore, the bulk of the population identify themselves as followers, with little intent on incentives to think for themselves to solve problems or to innovate. And leaders have failed to create a sense of leadership to those they lead. The third is the issue of relegating leadership to the government. This unfortunate perspective or culture, has warped our minds to see leadership as something that is only present or actionable with political power, and we also see leadership only as relative to others and hierarchical in nature. What that has meant is that the responsibility for advancing the development of the continent has been seen and relegated as the role and responsibility of government alone. The effect of this has been to disempower and disincen- tivise ourselves from taking ownership of our roles in our schools, our jobs, and in whatever sector of society in which we operate, to develop and exercise the leadership skills necessary to advance our communities, countries, and continent. If leadership, as I defined earlier is the art of getting results, then everyone can and should be a leader, because everyone can and should deliver results in our respective roles in society. Instead, for too long we have sat waiting for our leaders to tell us what to do, waiting for them to develop our communities for us. We have become a continent in waiting. We just sit and wait while others speak of our potential, which is waiting to

333 Tony Elumelu, CON be harnessed. We need to wake up and realise that no one will make these happen but us. So what can we do about this? How can we break the cycle to stop cruising on our potential and start the climb to our destined place in the world? What leadership opportunities have been opened by the challenge of leadership faced by the continent today? It is the search for this solution that led me to propound the concept and philosophy of Africapitalism. No one but us will develop our continent. We must individually understand and accept that we all have a responsibility to lead. We Africans must understand that just like leadership, development is not confined to a position or level; it is similarly not confined to a sector. The kind of leadership we need to develop the continent that we aspire to, is not confined to government. These are the reasons why I created the philosophy of Africapitalism. Africapitalism simply asserts that the private sector has a role and responsibility in advancing the economic and social development of our societies. I am on the same journey that you inquisitive intellectuals are on – to pass on knowledge, provide new insights and challenge our assumptions. When you achieve a certain amount of experience and a certain amount of success, it is important to reflect on what principles, practices and decisions led you to success. When you find those key elements, it is important to pass that knowledge along, so that others may learn from your success, and guard against your mistakes. As an entrepreneur and investor in the private sector, I recognise and embrace my role in moving Africa forward. I also recognise my responsibility to share what I have learned, and to help create more Tony Elumelus and UBAs. I looked

334 Africa Speaks: A Collection of Speeches at my history of investments, what guided my decisions and what impact I wanted to make. So, I came up with two strategic solutions. The first was to develop and promote thought leadership based on my investment philosophy of Africapitalism in order to inspire and guide others. The second was to directly invest in the next generation of African leaders or Africapitalists; entrepreneurs with the potential to transform the continent and enable us achieve our development aspiration. To achieve this personal responsibility to recreate my own success in others, I decided to put my money where my mouth is and help to nurture the next generation of African entrepreneurs, the next crop of business titans, through the Tony Elumelu Foundation’s Entrepreneurship Programme. The Tony Elumelu Foundation Entrepreneurship programme represents a $100 million commitment by my foundation to identify, train, mentor and provide seed capital to ten thousand African businesses over the next ten years, towards creating one million jobs and $10 billion in additional revenues across the continent. The tagline of the programme is “Your idea can transform Africa”.

We have become a continent in waiting. We just sit and wait while others speak of our potential, which is waiting to be harnessed. We need to wake up and realise that no one will make these happen but us.

335 Tony Elumelu, CON

The video trailer you watched is the genesis and gathering of the first class of one thousand entrepreneurs in the programme representing fifty-one African countries. They also represent the best one thousand transformative business ideas from twenty thousand submissions in 2015. For the Class of 2016, we chose the best one thousand out of a whopping forty-five thousand submissions. Through this programme the Elumelu entrepreneurs learn how to grow and scale up their business vision and team, and they are required to report their progress in job creation. The programme itself is highly structured in our giving. Individuals must apply and meet specifically laid out criteria and various milestones along the way. Those that do so, are those with vision, passion, discipline and optimism, and they are the ones that will succeed and become the UBAs of the future. Once they are on their way to success, they and their families and communities will not need a hand out in the future; rather, they will extend a hand up to others and replicate their success. This is another way we all can take on leadership roles in developing our continent, whether or not you are in private or public sector. But we need public sector leaders to create conducive conditions that will enable these young Africans to succeed in business. Millions of Nigerians are entering the job market every year, and the government, academia, and large corporations are not creating enough jobs for the graduates. Therefore, if you pursue entrepreneurship, your options for advancement are not limited to finding a white-col- lar job. You can create your own employment opportunity, as well as for others, and help to transform your communities, our great country, and even our continent – Africa.

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As an entrepreneur, you can help to develop innovative and sustainable private sector solutions to local challenges that deliver profit for you and development gains for society. That is what thousands of Tony Elumelu entrepreneurs are doing right now across Africa. Entrepreneurs such as Ke- hinde Yinusa who started Chronus Pride International Lim- ited to reduce maternal mortality rates in Nigeria by educat- ing young mothers, pregnant women and at-risk mothers on healthcare tips for both babies and mothers; or Belema Ala- gun of Britts Fresh Foods Company, who works closely with rural-based farmers to empower them to grow and supply a steady stream of vegetables for urban consumption. The company has become a household name in Lagos for their fresh salads and smoothies; or Alison and Chioma Ukonu who run a waste recycling and social benefit venture that operates an incentive-based scheme. They collect recycla- ble materials from consumers and in turn reward them with “points”; thereby, helping some of the poorest in our society generate an income by incentivising consumers to recycle, protecting the environment and making a profit. By my calculation that is a win, win situation. That is entrepreneurship. That is Africapitalism. What do they have in common? They are great ideas, a great vision, passion, drive, discipline and optimism to see it through. So, how are these people different from you, latent and aspiring entrepreneurs in this room or in this school? The answer is once again simple. They are not. These are young people like you, with same level of education, many of who live right here in Lagos. In conclusion, I want to assert that leadership matters in all spheres of Life. Just last month we hosted the TEF

337 Tony Elumelu, CON entrepreneurship programme’s Class of 2016 at the Law school in Victoria Island. And I told them that though Addis may be the African political capital, and the Kenyan Safari a top tourist destination, but if you want to feel the essence of entrepreneurship, you come to Lagos. If you want to feel the flow of ideas, you come to Lagos. If you want to feel the buzz of opportunity, you come to Lagos. If you want to feel the challenge of hustling, you come to Lagos. If you want to feel the heat of competition, you come to Lagos. And if you want to feel the hum of real time economic growth, what do you do? You come to Lagos. You are already in Lagos! If Lagos were a country, it would be among the top ten economies in Africa. Lagos has the best access to finance, the largest pool of skilled labour and the largest urban market anywhere in sub-Saharan Af- rica. You have infrastructure, comparative advantage and a market. What you do not have are any excuses not to try. If we wish to make positive, lasting and multigenerational change, the kind that can usher in the economic and social transformation of Nigeria and Africa, we must first work on developing ourselves as leaders, and start working with the generation following us to get the development results we all want. Go forth and lead. Africa is in dire need of transformational leaders. I look forward to welcoming some of you next year to the TEF Entrepreneurship Programme. Applications are available 1 January.

338 Africa Speaks: A Collection of Speeches

Building Stronger Economic Ties Between France and Nigeria: An Africapitalist Approach

Speech on at Discover Nigeria Event with French Senate Event, Paris, France, themed, The Potentials of Investing in Nigeria 27 May 2016

339 Tony Elumelu, CON

Nigeria remains a very viable, attractive and important investment and export destination for French companies. In fact, I would argue that now is a good time to come, because it is an investors market.

– Tony Elumelu, CON

340 he Honourable Gerard Larcher, President of the Senate of France; Ambassador Muriel Pénicaud, the TCEO of Business France and France’s Ambassador for International Investment; Ambassador Denys Gauer, France’s Ambassador to Nigeria, our representative from the Nigerian Embassy in France, corporate and SME leaders, distinguished ladies and gentlemen. It is an absolute honour for me to be invited to co-chair this Discover Nigeria event this morning with the honourable senate leader. Beyond that as a Nigerian, I am thrilled that Nigeria’s strategic and economic value have been recognised by the government of France. Only two weeks ago, His Excellency, President Francois Hollande was in our capital, Abuja, for a security summit with our President Mu- hammadu Buhari, and this week, you are holding this forum to advance Nigeria-France economic relations by hosting it here in the seat of your democracy and a key branch of your government. On behalf of my fellow Nigerians, and entrepreneurs in both our countries, I want to thank the French government for taking such strong and concrete steps to strengthen both security cooperation and economic ties between our two countries. I want to thank my co-chair, Senator Larcher, for hosting us in this beautiful, prestigious and historic institution of government. I also want to thank Ambassador Gauer, Ambassador Pinecuad of Business France and Bertrand De

341 Tony Elumelu, CON

France is one of the largest economies in Europe and Nigeria is the largest economy in Africa. So, it makes good economic sense for us to build a strong trading relationship that will deliver goods and services and economic growth in both nations.

La Forest Divonne for their tireless work and enthusiasm in putting together this event. I would like to recognise my friends at the Movement of the Enterprises of France (ME- DEF), who brought fifty French businesses to Nigeria last year, to explore business opportunities and partnerships as part of France’s effort to increase investment in Nigeria by 50 per cent over the coming years. I am thrilled to see so many people here excited to explore business opportunities in Nigeria or for those already in our markets, to share their stories of success and long- term investment. France is one of the largest economies in Europe, and Nigeria is the largest economy in Africa. So, it makes good economic sense for us to build a strong trading relationship that will deliver goods and services and economic growth in both nations. Many of the companies present here have been in Ni- geria for a long time. Companies like Air France, Bollore, CFAO and Total, and have provided much value to our citizens and made great returns for their shareholders. There are also SMEs here like Relais, who have been in Nigeria for decades and are as firmly rooted in the country as they

342 Africa Speaks: A Collection of Speeches are in France. Other companies present are ready to export and invest abroad, and have a lot of questions about Nigeria, many of which will be answered today. My hope is that today’s gathering will help demystify the Nigerian market for you and show you concrete examples of successful French businesses operating in the country for many years. You may have heard the news that Nigeria, like many of the economies in Africa that rely heavily on natural resources and commodities, such as oil, are experiencing very tough times. I am a realist and I will tell you in all honesty that the last year has been quite challenging for both the government and most of the private sector. Nigeria is an oil-dependent economy. The exploitation of domestic sources of energy in the US and the re-entry of the US and Iran into the oil market has sent the price of oil plummeting from $114 per barrel to as little as $32 per barrel. This has significantly impacted government revenues and caused it to take dramatic measures to protect the naira. It has surely been a difficult time, and we still have challenges ahead of us, but we are going to weather this period. As a realist, I must also tell you that Nigeria is always a good bet. According to the World Bank, the highest returns of investment are to be found in Africa and Nigeria is among those countries that generate these impressive returns. In fact, Nigerians and our government have made the smart decision to treat this as an opportunity to ramp up our efforts to diversify the economy, so there will be more opportunities for investors to come in and participate in expanding the economy. Nigeria has always been a unique country. We are not only the most populous country, we are among the most ed-

343 Tony Elumelu, CON ucated and well-travelled. While Nigerians are well known for our positive outlook and can-do spirit, even more importantly, we have a strong culture and spirit of entrepreneurship. Over the last two decades, we have significantly ramped up our knowledge, capital investments and accomplishments in the business arena. Our banks are not only highly regulated, which has created stability in the system, they are also highly capitalised financially and professionally, so they are able to develop and finance complex transactions in a variety of sectors across many countries. For example, the United Bank for Africa, of which I am chairman, was established in the British colonial era, more than seventy years ago. However, post-independence, it came under Nigerian control and had operated profitably for decades. However, in 2005, we decided that we wanted to live up to our name and become a truly pan-African financial institution. So, we developed a strategy to roll out in several Africa countries. We completed the first stage of the roll out and now operate in nineteen African countries, where we are providing financial services for governments, citizens and businesses, particularly leveraging technology to enable electronic payments across countries and continents, including here in Paris where we have an office that supports businesses and transactions with francophone countries. Critically, we are helping to finance major projects in the infrastructure, agriculture and construction sector most of which are francophone countries, and we have continued to open more and more branches as we become more established in those markets. The second stage of the roll out begins later this year. So, Nigeria is not just about ourselves;

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…Nigeria is always a good bet. According to the World Bank, the highest returns of investment are to be found in Africa and Nigeria is among those countries that generate these impressive returns.

we play an important role leading the economy of West Af- rica and beyond. When you invest in Nigeria, the benefits spill over to our neighbours in dozens of countries. As proud as I am of the accomplishments of UBA, this is just one story of one bank in Nigeria. Over the last two decades, new laws and reforms in Nigeria have enabled and incentivised local entrepreneurs to become players in sophisticated industries such as oil production and refining, telecoms, manufacturing, aviation and other sectors. For instance, Schneider Electric is pursuing opportunities in the power space. Additionally, in recent years, large retail giants from other parts of Africa have entered the Nigerian market because they have spotted the opportunities associated with servicing the growing Nigerian middle-class and they continue to do well, even in the current economic climate. So, in my opinion, Nigeria remains a very viable, attractive and important investment and export destination for French companies. In fact, I would argue that now is a good time to come, because it is an investors market. The smart investor knows that this is the time to enter these markets because the fundamentals of the Nigerian economy remain strong, and where others perceive risk and challenge, the

345 Tony Elumelu, CON glass is actually half full rather than half empty. Let me cite some examples of the trends supporting long-term growth: Increased use of technology by the Nigerian population; high consumerism, meaning we still want to buy finished goods; a young demographic, which means energy for work and innovation; and increasing urbanisation, which means more accessible markets for products. So I encourage you to come and discover Nigeria. I will say that while Nigeria is a lucrative investment destination, as smart investors, you must ensure that you do the following two things: Find the right partner to help you navigate the environment. It will make things easier and protect your investment; and commit to being in Nigeria the long haul. Companies like Air France and Total can tell you that Nige- ria rewards the patient investor. As you consider your entry on expansion in the Nige- rian market, I want to share with you the philosophy that guides my own investment in Nigeria and across Africa. I call it Africapitalism. Africapitalism advocates long-term investments in strategic sectors that generate economic dividends for investors and social benefits for stakeholders. I know it works because I was born and raised and spent my entire career in Nigeria, and I have been very successful adhering to this philosophy. I am invested in the financial services, real estate and hospitality, power, agriculture and health sectors because I consider them to be strategic in that they can help unlock jobs and growth in other sectors of the economy, thereby delivering benefits to the wider society. So, companies that are involved in these sectors should definitely come into our markets and partner with local businesses to provide goods and services to our population.

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Other strategic sectors in Nigeria include telecommunications, ICT, entertainment and retail, which will continue to do well even in the current climate. There are smart, hard-working, innovative and driven entrepreneurs on the ground, waiting to embrace you in partnership, if you would just take the chance of venturing outside of the familiarity of home for the sake your venture and adventure. Because working in Nigeria will be an adventure, of the best kind. I am particularly talking to the SMEs here; because you are the kind of partners we need the most on the ground. SMEs are the backbone of any global economy and you form deep ties and relationships locally and employ the most people. I believe so much in SMEs, and the spirit of entrepreneurship, and your power to deliver the kind of economic transformation that Africa needs that I, the big corporate leader, have invested $100 million to identify, mentor and fund ten thousand Africa businesses over the next ten years to create one million jobs and $10 billion in additional revenue on the continent. And the good news for all of you here today is that under this merit-based system, Nigerian

The smart investor knows that this is the time to enter these markets because the fundamentals of the Nigerian economy remain strong, and where others perceive risk and challenge, the glass is actually half full rather than half empty.

347 Tony Elumelu, CON entrepreneurs have continued to lead over the first two years of the programme. So, while I may be one of your partners today, I am also investing in developing your future partners and it will be a dream come true for me to witness Tony Elumelu Entrepre- neurs, in Nigeria and beyond, doing business with French businesses. To sum up, I want to thank you all again for gathering here today, and for your enthusiasm about investing in Ni- geria and I encourage you all to believe in Nigeria, come to Nigeria, discover Nigeria and invest in Nigeria. Help develop Nigeria and prosper with Nigerians. And very importantly, take an Africapitalist approach to entering and investing Nigeria, because what we are looking for are sustainable partnerships that will deliver long-term development through the private sector going about its nor- mal commercial activities. So, please come discover Nigeria and the full potential of your business.

348 Africa Speaks: A Collection of Speeches

Realising the Full Potential of the Nigerian Economy Through Proactive Capital Market Legislation

Speech at Joint Session of the National Assembly in Abuja FCT, Nigeria, themed, Creating an Attractive Environment for Investment 7 June 2016

349 Tony Elumelu, CON

There is so much global private capital seeking investment destinations. But it goes to where it is most welcome.

– Tony Elumelu, CON

350 s the chairman of Heirs Holdings and the United Bank for Africa, it is a pleasure to be here with all of Ayou this morning to represent the Nigerian private sector in this very important dialogue to develop concrete policy proposals to help stimulate our national economy. I want to start by thanking Senator Adeleke and the Hon. Tajudeen Yusuf for the kind invitation to speak to you today. This forum represents the continuing commitment of the National Assembly of Nigeria to engage with the Ni- gerian private sector to identify and resolve legislative, regulatory and institutional impediments to commercial activity and economic growth in Nigeria. At the public gathering of legislators in March, I com- mended the National Assembly for recognising that our laws are not perfect, and we need to review, amend and enhance many of them to improve the lives of our citizens; the proper role of government is not to provide employment for everyone, but to create, sustain and secure an enabling environment for citizens to independently create their own jobs and their success, using their own talents; and that the private sector is the engine for economic growth in Nigeria, and anywhere else. So you can imagine how I felt when I received this invitation coming after the event in March. It shows that our lawmakers are genuinely interested in improving the lives of

351 Tony Elumelu, CON

The private sector has the most capital to drive the economy and must take over the role that the government has wrongly assumed all these years. But for that to happen, the government must focus on its proper role in creating, improving and strengthening the enabling environment for business.

every Nigerian because what is good for the private sector is good for our people. But these dialogues and seminars should not be con- strued as an end in themselves. They should be seen as the beginning of the process. Until we legislate laws that enhance the competitiveness of our economy and the ease of doing business in Nigeria, we should not have any feeling or sense of accomplishment. The private sector has the most capital to drive the economy and must take over the role that the government has wrongly assumed all these years. But for that to happen, the government must focus on its proper role in creating, improving and strengthening the enabling environment for business. And government as we know is not only the executive arm. The trinity of government is accountable here. But the good news is that the legislative arm appears to be on the path to playing its part through initiatives such as this.

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There is so much global private capital seeking investment destinations. But it goes to where it is most welcome. Therefore, the challenge before all our three arms of government should be how to create the environment that will attract and retain these investments. I have been given the task of addressing how to deepen our capital markets by encouraging privatised and systemically important companies to list. Let me start with some broad observations. In Nigeria, many state owned enterprises have been privatised, but only a few have been listed on the market post government sale such as Transcorp Hotels and a few others. Systemically, important corporations such as the international oil companies (IOCs) and telecom companies (Tel- cos) are not listed on the market. This cuts off the ordinary Nigerians from benefiting from their country’s resource endowments. My advice is that it is in the interest of these systemically important entities to be listed on the market because it is when you democratise the access and ownership of these companies by listing them that you create shared prosperity and that engenders shared purpose, which creates mutual destiny. Where there is alignment of interests, the citizens will protect your company and want it to succeed because its success lends itself to common wealth. Another point is the creation of the middle class. List- ing of privatised and systemically important entities helps to create a middle class, and the middle class just like SMEs is the engine of growth of modern economies. To attract privatised and systemically important entities to the capital market, introduce incentives such as tax holi- days, ease of capital remittance, expatriate quotas and reduc-

353 Tony Elumelu, CON tion in transaction costs. That is, more flexible regulatory framework that can shorten the processing times and listing requirements. Presently, the Nigerian public feels excluded from the Nigerian oil and gas sector, as only a small percentage of the elite have so far managed to gain access through processes that are stringent and highly capital intensive. NASS and the executive arm of government should evolve innovative ways of meeting the aspirations of Nigerians to participate in the oil and gas sector. One such innovation is to make it possible for the Nigerian public to invest in the oil and gas sector. This can be achieved by evolving a Special Purpose Vehicle (SPV), which can be floated on the Nigerian Stock Exchange for the investing public. The shares in the SPV would be contributed by NNPC, seeding a small portion of the equity that it holds in the JVs that it has with the IOCs, while the IOCs also chips in a small equity: say NNPC 6 per cent, and IOCs 4 per cent. The shares of the SPV would be floated on the NSE such that the public is free to buy. The revenues realised from the sale of the shares would be able to continuously fund a substantial portion of the JV cash call while at the same time meeting the yearning of the Nigerian public for participation in the oil and gas sector. This way the nation can kill two birds with one stone through the SPV – meeting the yearning of Nigerians for participation while alleviating the cash call burden on the NNPC. But for this to happen, NASS must enact the enabling laws. Going forward, state owned enterprises and SIES must have as a pre-privatisation or licensing requirement, an agreement that a percentage – 25 per cent to 30 per cent

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– of the companies must be listed within three to five years of takeover or commencement. In our privatisation process or licensing for systemically important assets, our mentality is still in the colonial era. Usually, foreign operatorship or consortium leadership is a pre-requisite. Foreign operatorship should not be man- datory. The banking industry and the manner of its transformation has demonstrated that Nigerians have capacity to grow key sectors. In making decisions about who to sell to, our government or agencies should focus on expertise and capacity. Be- ing a Nigerian bidder should not put you at a disadvantage. NASS can easily deepen the capital markets. We need to look at other key sectors that have not been opened up such as key utility sectors like water and the airport, railways, etc. NASS can help by passing all pending legislation, which will open up these sectors – Railway bill, Integrated Infrastruc- ture bill, Nigerian Ports & Harbour bill, Nigerian Roads Fund bill, and so on.

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Africa Speaks: A Collection of Speeches

Fulfilling Promises: The TEF Stakeholder Challenge

Speech delivered at the Second Annual Tony Elumelu Foundation Entrepreneurship Forum, Lagos, Nigeria 29 October 2016

357 Tony Elumelu, CON

There are many more things stakeholders can do to support entrepreneurs and improve the enabling environment. And we are all stakeholders.

– Tony Elumelu, CON

358 our Excellency, President Ernest Bai Koroma, Your Excellency, former President Olusegun Obasanjo, YYour Excellency, former Prime-Minister Zinsou of Benin, Your Excellences, distinguished governors, distinguished representatives of multilateral organisations and national agencies, and African and international governments, public servants, business leaders, civil society, TEF mentors and partners, friends and family, distinguished ladies and gentlemen; and of course, my fellow entrepreneurs, who are soon to distinguish themselves in the business sector. Thank you everyone for being here today. From the bottom of our hearts, Awele and I want to thank His Excel- lency, President Ernest Bai Koroma of Sierra Leone for the gift of his time in coming to demonstrate his support for the Tony Elumelu Foundation’s Entrepreneurship Programme and all African entrepreneurs. We want to thank our distinguished father and statesman, President Olusegun Obasanjo, one of the most catalytic presidents the Nigerian private sector has seen. We thank former Prime-Minister Zinsou for coming to support the programme last year, as a statesman, and this year returning as a member of the Foundation’s Global Ad- visory Board, to give our entrepreneurs the benefit of his tremendous experience in the private sector. We thank all our guests who made it here from far and wide, both domes- tically and internationally. It gives me great pleasure to say to

359 Tony Elumelu, CON all of our guests, welcome to Lagos and to the second annual Tony Elumelu Foundation Entrepreneurship Forum. Today, in this this room, are gathered individuals from fifty-one African countries. While beautiful Addis may be the political capital of Africa, I am proud to say that, this week, Lagos is the entrepreneurship capital of Africa. And it is no accident that the foundation has chosen to host the forum in Lagos every year. You may go to several other Af- rican cities for history, architecture, beaches, medicine, safa- ris,, etc., and they are all great. But if you want to feel: the essence of entrepreneurship, the flow of ideas, the buzz of opportunity, the challenge of the hustle; the hum of economic growth; and the heat of competition, then Lagos is where you come. The reason we are gathered here today is to fulfil the two TEF promises. The first promise is to invest $100 million to identify, train, mentor and fund ten thousand entrepreneurs in ten years. The second is to improve the enabling environment for all African entrepreneurs. If you look at the sea of T-shirts behind you, and at each other, you know we are keeping the first promise. The second promise is much harder than spending $100 million, because we cannot order infrastructure on the internet; donors cannot dash us good policy; and we cannot just wait for luck to send us the calibre of political leaders as we have seen on stage today. We have to engage and put pressure on ourselves, and our leaders to do more to improve the enabling environment for startups to succeed. This is critical. As excited I am about the two thousand entrepreneurs that we have selected to benefit from the programme in its

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…while beautiful Addis may be the political capital of Africa, I am proud to say that Lagos is the entrepreneurship capital of Africa.

first two years, this gathering is in some ways bittersweet for me because my heart still carries with me the entrepreneurs behind the sixty-three thousand ideas we could not select. Some of them were brilliant. They deserve a chance too. So I have carried them with me from Dakar to Dar-Es- Salaam, and from Kampala to Kigali to Cape Town, to have this conversation with our political leaders. I have brought hundreds of young Elumelu entrepreneurs before them to remind them that alongside their social welfare priorities should exist economic opportunity priorities because extreme poverty and economic opportunity can rarely coexist in the same place. In addition to our advocacy and research, the foundation has thrown out a challenge to all stakeholders – the public sector, private sector, civil society, multilateral organisations and individuals – invested in Africa’s economic development to tell us how they will take action to support Af- rican entrepreneurs and improve the enabling environment for entrepreneurs to succeed. I am delighted to inform you that we are off to a great start. The Nigerian government has accepted the TEF Chal- lenge and committed to working with us to improve the enabling environment for entrepreneurs in the much ne-

361 Tony Elumelu, CON glected, yet growing, creative industries. The government of Cote D’Ivoire has adopted the TEF model to identify, train mentor and fund thousands more aspiring Ivorian entrepreneurs. ECOWAS will partner with the foundation to develop a regional strategy to promote entrepreneurship and Africapitalism in the West Africa region. The International Trade Center in Geneva and the Nigerian Export Promotion Council will work with us to achieve their goal of helping to connect one million female entrepreneurs to global markets. Coca-Cola is doing something similar with women in the private sector side by incorporating a million women into their global supply chain. General Electric is providing skills development for African SMEs; and Microsoft is providing a whopping $300 million worth of business software to help the TEF entrepreneurs manage their businesses in a systematic and sustainable way. The level of response overwhelms me, and demonstrates what is possible when you are taken seriously. And it is clear that, with the success of our entrepreneurship programme, policymakers and key stakeholders take us seriously. I promise you that we will continue to throw out this challenge to all these stakeholders to do more. Every year of the forum, we will give a platform to various stakeholders to respond to this challenge – to stand and deliver on their promises to be part of a better future for Africa. And, I have no problem giving you examples of the kinds of commitments we hope to secure in the coming years. They include large corporations, philanthropies and high net worth individuals stepping up to help fund some of the great ideas that TEF and other organisations are not able to finance; governments taking measures to increase

362 Africa Speaks: A Collection of Speeches the ease of business incorporation, prioritise tax relief, incentives and singular collection points for federal, state and local business taxes, and set up or invest in SME industrial parks and incubators across Africa. For example, through CcHub, TEF provided seed capital of $5,000 each to twenty Nigerian startups, several of which have grown to national and international acclaim. In fact, CcHub has grown to attract the attention of leg- endary Mark Zuckerburg, the creator of Facebook. But TEF saw their potential much earlier and more of these types of gems should be given, not a hand out but investment to unleash their potential to grow, scale and transform large seg- ments of society with new jobs, new innovations, and help to create the new narrative of Africa. There are many more things stakeholders can do to support entrepreneurs and improve the enabling environment, and we are all stakeholders. So I challenge more stakeholders to come here next year and tell us what they will do to support African entrepreneurs and the enabling environment for entrepreneurship. Speaking of enabling, I want to thank the following individuals: Dr. Awele Elumelu, the CEO of Avon Medical and the Elumelu Household, and Trustee of the Foundation

The success of your ideas and businesses are the legacy of the Foundation, and the future of the continent. You are all winners and I am proud to be your champion.

363 Tony Elumelu, CON for her active support of the goals and work of the Founda- tion; Parminder Vir, the CEO Extraordinaire of the foundation; Owen Omogiafo, who led the planning process of this amazing pan-African gathering; and the TEF and Heirs Holdings staff, who have done more than you can compre- hend to support all the entrepreneurs you see here and make this event come together. I want to thank the United Bank for Africa, for sharing our vision of Pan-Africanism and Africapitalism by embracing the role of the private sector in Africa’s development and sponsoring this forum. Lastly, I want to thank you, the Elumelu entrepreneurs in this auditorium, those watching the live stream and those getting ready to apply for the TEF programme, and the chance of a lifetime in January 2017. You are why we do this. The success of your ideas and businesses are the legacy of the foundation, and the future of the continent. You are all winners and I am proud to be your champion. In closing, I hope you have learned and networked, been challenged and inspired.

364 Africa Speaks: A Collection of Speeches

Speech on Realising Democratic and Economic Dividends of Tunisia’s “Dignity Revolution”

Tunisia 2020 at International Investment Conference, Tunisia 29 November 2016

365 Tony Elumelu, CON

In Tunisia, you have ensured that your “Dignity Revolution” served its purpose. In the last five years, the people of Tunisia have taken back their government, and taken back their dignity and restored peace and stability to your nation.

– Tony Elumelu, CON

366 our Excellency, President Beji Caid Essebsi of the Republic of Tunisia and our distinguished host, YYour Excellency, Youssef Chahed, the Prime Min- ister of the Republic of Tunisia, your excellences, visiting head of state and governments, distinguished ministers of the Republic of Tunisia, distinguished ladies and gentlemen. My name is Tony Elumelu. I am the chairman of the United Bank of Africa, which provides financial services to fourteen million Africans in nineteen African countries, and Heirs Holdings whose portfolio includes financial services, oil and gas, power, real estate and healthcare, and the founder of the Tony Elumelu Foundation. I am deeply honoured and appreciative of the invitation to be here with you this morning in beautiful Tunis. I came here from my country Nigeria to congratulate you and ex- press my support for the government and people of Tunisia. On 17 December 2010, a terrible tragedy occurred. Mohamed Bouazizi, a young Tunisian entrepreneur of just twenty-six, in an act of despair set himself on fire, ignited a revolution in Tunisia that set off a chain of events in the region, a series of political revolutions that we now know as the Arab Spring. While it is deeply concerning that the peace and stability of the countries where the people rose up in revolution for change remains in question, and in some

367 Tony Elumelu, CON cases tragic, but that is not the story of Tunisia. In Tunisia, you got it right. Tunisia has led the way, and this government’s commitment to social justice and critical economic development is a model and lesson to all of us. In Tunisia, you have ensured that your “Dignity Revolution” served its purpose. In the last five years, the people of Tuni- sia have taken back their government, and taken back their dignity and restored peace and stability to your nation. For that courage, for that example, you deserve the congratulations and the commendation of the whole world. Beyond commendation, you deserve our support, in word and deed, and you especially deserve our investment. For you have understood that economic growth can only occur and flourish in an environment of political stability. So, you have chosen peace and you have chosen democracy, and now investors will choose you. They will choose to invest in Tunisia. Now, I see leaders here from Europe and the Middle East and many other regions. Their presence is not only a testament to the work that you have done in restor- ing stability to your nation, it is also speaks to the strategic geographic position of Tunisia. You are indeed the gateway between Europe and Africa. Right now, too many Africans from many nations are using Tunisia as the gateway to leave the continent; taking risks with international laws and their lives in the search for something better. My hope is that through the investments and growth that will come out of this conference, Tunisia will become the gateway for investments to come into the continent of Africa, that will generate commercial activity and jobs, which will keep our people here on the continent where we need our human capital as much as we need fi-

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Tunisia has led the way, and this government’s commitment to social justice and critical economic development is a model and lesson to us all. nancial capital. While Mediterranean nations and some of your neighbours may want to claim Tunisia as their own, and many nations of the world count you as an Arab country, I also come as your brother from sub-Saharan Africa to claim you first and foremost as one of our own. You are one of the fifty-four countries that make up the African Union and we want Tunisia to be part of a strong, stable, integrated continent that increasingly trades within itself. The European Union does 55 per cent of its trade among its member countries, while African Union does about 12 per cent trade among us. That must change. We must produce what we consume and trade within our region. African unity should be much more than annual gatherings of political leaders and bureaucrats. African unity should be about shared challenges and experiences, shared ideas and goals, and bonds of blood and trade. Sustainable economic growth in Tunisia and Africa should be driven by a newly shared approach that I call Africapitalism, an economic philosophy that advocates long-term investments in strategic sectors that deliver economic and social dividends. For Tunisia’s stability to be sustained, the dividends of the economic growth that we all expect to happen in this

369 Tony Elumelu, CON great country must permeate all levels of society – what Dr. Jim Kim of the World Bank calls “shared prosperity”. And I believe that shared prosperity can only be achieved when the government and private sector work in “shared purpose” to advance the economic and social development of nations and the continent. So, in that spirit, I have answered the call of the Tuni- sian government. I have not only come here, but I commit to you that my colleagues in UBA and I will examine some of the projects you are highlighting here to see where we can collaborate with you on the financing side. Personally, I want to support Tunisia’s economic transformation by investing in your young aspiring entrepreneurs and helping to nurture them into the next generation of top African business leaders, through the Tony Elumelu Foundation’s Entrepre- neurship Programme. The Tony Elumelu Foundation’s Entrepreneurship Programme is a $100 million commitment I made to identify, train, mentor and fund ten thousand Africa businesses in ten years. It is open to citizens of all African nations, regardless of age, gender and educational qualification. We have had sixty-five thousand applications over the last two years from which we chose the top one thousand ideas each year that can transform Africa. Last night, I met with some of the Elumelu Entrepre- neurs from Tunisia, and they are going to do wonderful things in this country and beyond your borders. But I will tell you that North Africa is the most under represented region in the programme, and I dearly want to change that. So I want to ask for your help. The portal for the next cycle of the programme opens on 1 January 2017. I want it to be

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African unity should be much more than annual gatherings of political leaders and bureaucrats. African unity should be about shared challenges and experiences, shared ideas and goals, and bonds of blood and trade.

flooded with applications from Tunisia and other North Af- rican countries because I believe in our young people and their ability to collectively transform our continent into a strong regional economic player in just one generation. And they can, if we would just give them a chance and hope. The hope that Mohamed Bouuazizi, an entrepreneur himself, did not have, but whose loss should teach us the priceless value that a single mindset can create, which mandates us to ensure a different outcome for others like him. I believe that if we do right by our young people, they will emerge not as martyrs, but business champions, and our continent will be all the better for it. In conclusion, I thank you again for having me here and want to tell you that in opting for a peaceful political revolution, the Tunisian people have done the right thing, and by the end of this conference, partner governments, businesses and investors will do right by you. Thank you.

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Challenges and Opportunities in African Leadership

Speech delivered at the Formal Presentation of Dr Maxwell Uba’s Book, The Alphabet of Leadership

373 Tony Elumelu, CON

Some may be born leaders, but for most, leadership is learned, and you can always be a better leader.

– Tony Elumelu, CON

374 ood afternoon all. Chairman of the occasion, kindly permit me to Gstand on existing protocols. I am here today, in two capacities – as both a mentor and student of today’s celebrated author, Dr Maxwell Uba. I am also a proud friend of this fine gentleman, who is extremely cerebral. There is no greater gift to the world than to pass on knowledge. So I am glad to be here with you to help launch and evangelise the message of Maxwell’s new book, The Al- phabet of Leadership, so aptly titled. Maxwell has chosen a very important topic to focus on leadership. Leadership is a skill, which if successfully developed becomes the character of a person, organisation and even a nation. Where it is used positively, leadership can be transformative in the lives of those same entities, and even, I dare say it, transformative of a continent. This is what Maxwell has asked me to speak about today: the challenges and opportunities for leadership in Af- rica. I am honoured and humbled that he has asked me to take on this role on this important day in his life, and even more honoured and humbled that he has chosen to dedicate this book to me. I take it as a reminder to be a leader in every aspect of life and a challenge to continue to improve on my leadership skills. I will start by defining leadership my own way, then I will speak about of the challenges of leadership in Africa;

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When a unit or country does better, the continent does better, and when a unit does better, it can help to inspire the improvement of the functions of related units.

and finally, how we go about resolving this leadership challenge and what it could mean for the continent. A leader can be summed up as someone who gets results”. Therefore, I believe you can be a leader at any stage in your life and career, and in any career path you choose. Whether you are leading a team of people, or just yourself, your responsibility is to generate, secure or deliver results. I also believe, and this is good news for those who do not feel that leadership is an innate quality they possess, that leadership is learned. Some may be born leaders, but for most, leadership is learned, and you can always be a better leader. So, it is important to keep developing your leadership skills throughout your career. I can tell you that I am still working on myself. And that is why I continue to show up for Maxwell and Chike’s leadership seminars for my staff because I always learn something new, and continuous learning is a must for leaders. Some ways of continuously learning leadership skills throughout your career include treating challenging situations, both good and bad, as learning opportunities; reading books like the one we are launching today; attending events such as this and hearing directly about the experiences of

376 Africa Speaks: A Collection of Speeches others; and observing leaders who are transformational and learning how they do it. When it comes to Africa, I think of the continent as a collection of organisational units called countries. When a unit or country does better, the continent does better, and when a unit does better, it can help to inspire the improvement of the functions of related units. Africa has about one billion people, fifty-four countries and thousands of languages and cultures. What we share is one common aspiration – development. We would all like to see the continent take its rightful place in the global economy as a strong regional player. Leadership is key in achieving this because leadership sets direction and mobilises for results. And how do you measure development? You measure it by the results or outcomes of our strategies, expenditures and investments in the quality of life, stability and well being of our citizens. In the private sector in Africa, why is it that in most cases businesses do not transcend their founders. What are our practices? I want to highlight three leadership challenges in Africa that really constrain our development progress. Lifetime leadership does not equal lifetime achievement: Africa has long suffered from the “president for life” syndrome. In the 1960s and 1970s, post-independence era, a group of leaders assumed office and many stayed in office for twenty, thirty and even forty years. They include Mobu- tu Sese Seko, Muammar Ghaddafi, Conte in Guinea, and there are several others with extended tenures in power today. To stay in office that long, you have to be “strong man”. This is not the same as being a strong leader. The effect of this is that power is concentrated at the

377 Tony Elumelu, CON top. If you need power to maintain your leadership role, then you will of necessity have little room for dissenting ideas, and leadership requires the ability to listen to new and diverse ideas and opinions to select the best ones to guide your team, organisation or nation. So, when our political leaders spend twenty to forty years sacrificing good ideas to maintain power, they are sacrificing our development aspirations and our futures, our destinies. The same goes for military regimes, which rely on obedience without question. A culture of obedience is important to maintain strength and order in armed forces, but it is highly detrimental to political governance. And this is the governance culture that Nigeria endured for too many decades, and the leadership gap we are all now working hard to close. Defining and confining leadership within the top strata; for too long, Africans have understood leadership as a function of people at the top of any chain, so only the principal, the head of department, the vice chancellor, the chief executive officer or chairman, the minister or the president is a leader. The bulk of the team or population identify themselves as followers, with little intent on incentive to think for themselves, to solve problems, to innovate, and leaders have failed to create a sense of leadership in those that they lead. We have relegated leadership to the public sector. This unfortunate perspective or culture has warped our minds to see leadership as something that is only present or actionable with political power, and we also see leadership only as relative to others and hierarchical in nature. What this has meant is that the responsibility for advancing the development of the continent is regarded as the role of government alone.

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The effect of this has been to disempower and disincen- tivise ourselves from taking ownership of our roles in our jobs and in whatever sector of society we operate in, from developing and exercising the leadership skills necessary to advance our sectors, communities, countries and continent. If leadership, as I defined it earlier, is the art of getting results, then everyone can and should be a leader, because everyone can and should deliver results in our respective roles in the society. Instead, for too long, in Nigeria, An- gola, Kenya, etc., we have sat waiting for our leaders to tell us what to do, and waiting for them to develop our communities for us, and that has been its own reward; we have become a continent in waiting. We just sit and wait while others speak of our potential. Our potential is waiting to be harnessed. We need to wake up and realise that no one will make things happen but us. So what can we do about this? How can we break the cycle to stop cruising on our potential and start the climb to our rightful place in the world? What opportunities have emerged due to the challenges of leadership faced by the Af- rican continent today? First, Africans must each understand the truth that no one but us will develop our continent. Second, we must individually understand and accept that we all have a responsibility to lead. Third, both society and political leaders need to understand, accept and embrace change. More importantly, succession. You can be a good leader for a time, but great leadership involves planning, preparing your organisation, community or nation and executing your own departure. You must prepare your successor and the next generation to take on leadership roles, including you own. Fourth, Af-

379 Tony Elumelu, CON ricans must understand that just as leadership, particularly on matters of development is not confined to a position or level, it is similarly not confined to a sector. Leadership to achieve the development of the continent that we aspire to is not confined to government. That is why I created the philosophy of Africapitalism, which simply asserts that the private sector has a role and responsibility in advancing the economic and social development of our societies. I did this because I am on the same journey that Maxwell has embarked on – to pass on knowledge. When you achieve a certain amount of experience and success, it is important to reflect on what principles, practices and decisions led you to success. When you find those key elements, it is important to pass that knowledge along, so that others may learn from your success, and guard against your mistakes. As an entrepreneur and investor in the private sector, I recognise and embrace my role in moving Africa forward. I also recognise my responsibility to share what I have learned, and to help create more Tony Elumelus and UBAs. I looked

As an entrepreneur and investor in the private sector, I recognise and embrace my role in moving Africa forward. I also recognise my responsibility to share what I have learned, and to help create more Tony Elumelus and UBAs .

380 Africa Speaks: A Collection of Speeches at my history of investments, what guided my decisions and what impact I wanted to make. They were primarily promoting development in Nigeria and across Africa; operating from the private sector by creating wealth for all stakeholders; and delivering societal dividends as well. So, I came up with two strategic solutions. The first was to develop and promote thought leadership based on my investment philosophy to inspire and guide others. The second was to directly invest in the next generation of African leaders or Africapitalists to help transform the content and achieve our developmental aspirations. I will start with the first. That is the Africapitalism I already spoke about, an economic philosophy to deploy, empower and enjoin private sector participation in the economic and social development of the African continent. The private sector must do this working in “shared purpose” with the public or governing sector to achieve development gains. Africapitalism specifically advocates long-term investments in strategic sectors that generate both economic dividends for investors and social dividends for society. I am so resolute in my belief that I am pushing this philosophy in all arenas. I have spoken with colleagues, media activists, investors, political leaders and students across Africa and the globe to evangelise this new paradigm of the private sector as a development actor in Africa. I believe if every investor and business person practised a common philosophy that includes patient capital, healthy returns and societal benefits, it would unleash billions of dollars in investment, income and infrastructure on the continent. To achieve my second goal of recreating my own success in others, I have decided to put my money where

381 Tony Elumelu, CON my mouth is and help to nurture the next generation of Af- rican business leaders as Africapitalists, through the Tony Elumelu Foundation’s Entrepreneurship Programme. The programme represents a $100 million commitment by my foundation to identify, train, mentor and seed ten thousand African businesses over the next ten years, towards creating one million jobs and $10 billion in additional revenues across the continent. The tagline of the programme is “Your idea can transform Africa”. The video trailer you have just watched is the genesis and the gathering of the first class of one thousand entrepreneurs in the programme representing fifty-one African countries. They also represent the best one thousand transformative business ideas of twenty thousand submissions in 2015. For the Class of 2016, we chose the best one thousand out of a whopping forty-five thousand submissions from fifty-three countries. Through this programme, the Elumelu entrepreneurs learn how to grow and scale up their business vision and team. They are required to report their progress in job creation; and the programme itself is highly structured in our giving. Individuals must apply and meet specifically laid out criteria and various milestones along the way. Those that do this are entrepreneurs with vision, passion, discipline and optimism, and they are the ones that will succeed and become successful businesses of the future. Once they are on their way, they and their families and communities will not need a hand-out in the future, and they will extend a hand to others and replicate their success. In conclusion, I want to assert that leadership matters

382 Africa Speaks: A Collection of Speeches in all spheres of life. This is another way we can all take on leadership roles in developing our continent, whether you are in the public or private sector. But we need public sector leaders to create conducive conditions that will enable these young Africans to succeed in business. Today, we have talked about public and private sector leadership. We have also talked about past, present and future leaders. To tie it all together, the lesson is simple. If we wish to make positive, lasting and multigenerational change, the kind that can usher in the economic and social transformation of Nigeria and Africa, we must first work on developing ourselves as leaders, and start working with the generation following us to get the developmental results we all want. Reading Maxwell Ubah’s book is a very good step, and when you have done that go forth and lead, for Africa is in dire need of transformational leaders.

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Quotes Quotes about The Power of Vision

“Africa needs to be transformed and Africa’s transformation must begin with the education of our youth. Africa’s youths are the future.” –Tony Elumelu, CON. The University of Dakar Dakar, Senegal

“For the continent to develop fully and truly achieve this last frontier status, the private sector has a key role to play. It is therefore important, to look at the current crop of entrepreneurs in Africa, encourage them, and aid the growth and development of more budding entrepreneurs on the continent. Given Africa’s population density and its propensity to adapt easily to new solutions, digital technologies are almost assured of success.” – Tony Elumelu, CON. World Economic Forum, Africa, Kigali, Rwanda

“I believe that, as this institution does, Africa to a large extent can and will be developed by the private sector. Government has a role to play, but the role of government to a large extent is to help facilitate or to help create the right environment. But it is when we begin to see the emergence of African multinationals that can employ people and help grow our economies that we will say that the age of Africa has truly come.” – Tony Elumelu, CON Strathmore Business School, Kenya

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“First learning point is this: if you want to create a pan- African institution, have a vision. For us, it started with a vision, and part of that vision was that we saw beyond the shores of our home market, we saw Africa as our market. For business leaders here who are interested in creating a pan-African institution or an Africa-wide corporation, go back a bit and come up with a clear vision that encompasses this aspiration.” – Tony Elumelu, CON Strathmore Business School, Kenya

“Second lesson is to develop a strategy for making your vision happen for serving your customers. For instance, because Standard Trust Bank was a distressed institution and based on our reading and understanding of the market at the time, we wanted to serve the mass market. Not a bottom of the pyramid bank, but we wanted to be a retail and commercial bank, and we came up with certain ideas and innovations to achieve this.” – Tony Elumelu, CON. Strathmore Business School, Kenya

“If you want to be pan-African, if you have the intent to build an Africa-wide corporation, think long-term.” – Tony Elumelu, CON. Strathmore Business School, Kenya

“Human Resources is as important, maybe even more important than capital because when you get capital into a business, capital does not operate itself. Capital is operated, used, utilised by people, and it is important you get the

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people equation right. In fact, one wrong hire in a new business can be detrimental to the success of the business.” – Tony Elumelu, CON Strathmore Business School, Kenya

Quotes about Africapitalism and Entrepreneurship

“The private sector must lead. The public sector must create the enabling and competitive environment for businesses to do well. The social sector must redefine how to engage so that it’s sustainable and long lasting. We think that as we make investments we should have at the back of our minds – in fact, it should be implicit, it should be part of our investment criteria – an analysis: Does it have social impact? Is it sustainable? Will it create value? We believe that the interplay of all these would create a better African society.” – Tony Elumelu, CON. 2012 Global Philanthropy Forum, Washington, D.C.

“Africa must unleash the power of private enterprises to create jobs, expand exports, and generate wealth. To do so, African governments and their international partners will have to move in two directions. First, they must make the regulatory and legal climate for enterprise less costly

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and more transparent. Second, they must increase their investment in infrastructure, particularly roads and power supply.” – Tony Elumelu, CON. Inclusive Capitalism Conference London, UK

“About half of Africa’s population is under the age of fifteen. When compared to other aging regions of the world, we have definitely won the demographic dividend. This means that Africa is poised to become the engine of global economic growth, but only if we empower and harness our youth as well. My brother, Akin Adesina, is brilliantly using the platform of the bank to ask and answer how we ensure the conversion of that demographic dividend to economic dividend. For me the answer is clear, it’s job creation through entrepreneurship.” – Tony Elumelu, CON. African Development Bank Meetings Lusaka, Zambia

“The world is going digital and Africa has caught up on it, with ecommerce fast becoming a staple even as there is a surge in digital retailing on the continent. In Africa, we have the youngest population in the world and the highest levels of youth unemployment; the challenges are many, but the solution is simple – entrepreneurship is the easiest way to catalyse growth on the continent.” – Tony Elumelu, CON. World Economic Forum Africa, Kigali, Rwanda

389 Quotes about the Future of Africa

“I believe in education, which you have. I believe in excellence, which you must strive for at all times, and I believe in the spirit of entrepreneurship, which we all have within us.” – Tony Elumelu, CON. Delta State University, Abraka Delta State, Nigeria

“We must find jobs for our youths. Jobs have to be created through entrepreneurship. We should encourage our young graduates to go out and take risks, create startups, find technological solutions to everyday challenges and source for investments to build on their dreams.” – Tony Elumelu, CON. Delta State University, Abraka Delta State, Nigeria

“The tragic events that have unfolded in Nigeria over the last several weeks has captured the world’s collective consciousness, and highlights the importance of inclusive growth in a very fundamental way. In the absence of opportunity and hope, desperation and extremism are more than able to take hold of our brothers and sisters and incite violence against one another. The connection between the imperative of inclusive growth and ensuring the security of our most vulnerable citizens is undeniable. It is therefore incumbent upon those of us in positions of leadership to

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accept the realisation that our own success is diminished if we do not help to ensure that others can share in the wealth that is created.” – Tony Elumelu, CON. Inclusive Capitalism Conference London, UK

“In 2010, the Boston Consulting Group, BCG did a study on what they called “the African Champions” and came up with about forty champions across Africa. UBA and Dangote Group were two pan-African institutions that emerged from Nigeria.” – Tony Elumelu, CON. Strathmore Business School, Kenya

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