Goldmine: Why Africa should invest in education and refine its talent into assets for eonomic development.

With a land mass the size of the US, China, India, Japan, Germany, Norway, Mexico, Spain, and parts of Europe put together, Africa is the largest region in the world. Not only that, it has the youngest population with a median age of 18.8. The question is, can Africa turn these endowments into competitive and distinctive advantages, that is, mine raw gold and refine it into a valuable resource?

The process of refining a “rock” from the ground into pure gold is arduous. It involves subjecting raw gold to different purification and refining processes. Broadly, there are two methods: the Miller and Worlwill processes. Other methods include inquartation (diluting the gold in the refinable material to about 25% by melting with the appropriate amount of copper or silver so as to generate a high surface area for the melt and then treating with nitric acid); Cupellation (a process of subjecting of ores or alloyed metals to very high temperatures); Parting (a process which involves separating of gold from silver and other metallic impurities).

The World Gold Council says the Miller process uses gaseous chlorine to purify gold when it is at its melting point (1,063 °C (1,945 °F)). Gold achieved through the Miller process is about 99.95 percent pure. But gold refined through the Worlwill process is purer, boosting purity to about 99.99 percent. The process involves dropping impure gold casting into an electrolyte of hydrochloric acid and gold chloride.

Incidentally, Africa used to be known as the gold coast, a moniker that would eventually latch onto Ghana. It is well noted that Africa abounds in natural resources – diamonds, sugar, bitumen, gold, iron, uranium, bauxite and the like. It is also well known that the continent boasts an avalanche of human resources.?

For starters, it has the youngest population in the world with a median age of 18.8 compared with the median age of the Global North countries – United States, 38, United Kingdom, 40.7 years, France, 41.4 years, Japan 48 years.?

The implication of the median age for Africa is that more people are entering the labour market than they are leaving it. That is, it can galvanize the energy, curiosity and swag of its young population to transform its economy into a global powerhouse. On the other hand, the implication for the Global North countries with ageing population is that more people are leaving the labour market than they are joining it and hence reducing their potential and capability to create new products and services, innovating and sustaining their wealth-creation streak.

That being said, on paper, Africa should have been significantly richer than the US, UK, or Germany. But we know that’s not yet so. In other words, having a young population is not an automatic password to economic prosperity if the young and vibrant youths do not have the opportunity to contribute productively to the national economy. Which is why advanced economies have always been richer than poor countries. Nothing has significantly changed over the last couple of decades.?

A World Bank report, Boosting Productivity in Sub-Saharan Africa, makes that clear. It posits that the disparities between developed and developing countries are like night and day. Wealthy countries were 23 times more productive than poor ones in 1960, that gap increased to 37 times by 2017. While the gap between the top decile countries and those in the middle has hovered around fourfold between 1960 and 2017. So, if having a young population boosts productivity, how can Africa leverage its young population to notch up productivity and hence boost its economy???

The power of education.

Plato was spot on. “If a man neglects education, he walks lame to the end of his life.”

Perhaps, to make progress, oftentimes, it is helpful to look in the rear mirror. Many post-independence national leaders in Africa such as Kwame Nkrumah, Nnamdi Azikiwe, Modibo Keita, Ahmaodou Ahidjo,? Obafemi Awolowo, Sylvanus Olympio, and Ahmed Sekou Toure and so many of their contemporaries placed a premium value on education and rightfully so. They believed education had the power to lift their people out of the cesspool of poverty. And so, they argued for a greater allocation of resources to education.?

Let’s use Nigeria as a case point. As you are aware, Nigeria became an independent nation in 1960. But even before 1960, it had relinquished colonial rule and assumed an independent status in the 1950s using the Macpherson constitution. The constitution gave each region the autonomy to develop at its pace.?

In 1952, Chief Obafemi Awolowo’s Action Group won the first election into the Western House of Assembly. To many who know Nigeria’s history, Chief Obafemi Awolowo was a nationalist, one of the most intellectually-forward Nigerians ever. He was the first Premier of the Western Region and an advocate of the deepest dye for free education. He minced no words about his persuasion that education is a veritable tool for levelling the field for people no matter their background and social class, and powering national economic transformation.?

He planked his free education policy on three poles?

1. To reduce the inequality in society, which has been the most potent cause of deep social and political disaffection in Nigeria 2. A truly educated citizenry is one of the most formidable deterrents to dictatorship, oligarchy and feudal authority 3. An educated individual is the strongest single factor in any nation’s rapid economic and social advancement

The World Bank agrees with Chief Awolowo. Absolutely. A blog post, “Why Education Matters for Economic Development” syncs with the thoughts of the late sage. The author noted that the number of people in school globally is the highest ever. In Africa, for instance, in 1950, the average schooling years were less than two. Today, it is more than five. In East Asia and the Pacific, the average schooling years went from two to seven between 1950 and 2010. Yet there are 124 million children and adolescents that are not in school. About 250 million children cannot read even after several years of schooling.

That being said, the author argued that education is an investment. He referred to two Nobel prize winners as protagonists of the idea. T.W. Schultz proposed that education is the force that drives economic growth while Gary Becker bestows on us the Human Capital Theory. The Human Capital Theory basically espouses the idea that investment in education produces higher wages. Investment in able workers generates more returns than investment in less able workers.?

Another notable point the author made is that education pays. He argued that another year of learning may raise income by 10 percent. The value of human capital which is the share of human capital in total wealth is 62%. ? Which is four times the value of produced capital and 15 times the value of natural capital. Governments, private sector, families and individuals spend roughly $5.6 Trillion on education and training. Further, people are getting more returns from schooling in the labour market these days. In Africa, the return is as high as 20% while in East Asia and the Pacific, the return is about 14%.

Going further, the author observed that the skill required in the labour market is changing as employees adjust to automation. This is why the returns on investment in education differ from region to region. As rightly posited, the ability to compete and perhaps earn more wages is hampered by the poor performance of education systems in many developing economies such as Africa.?

Tackling the hydra-headed monster of low-quality education in Africa.

Each time I am driven through a particular locale in Lagos, I am always fascinated by the bold statement inscribed on the wall of a school, “Your child’s first school should be the best”.??

Of course, that’s a no-brainer, the school is literally saying, the education of a child should be built on a firm foundation. So true. Success in life starts with the kind of schools the child attends especially their first school. As a matter of fact, the early years of the child prepare the foundation for their socioeconomic development. They determine whether she will be successful in school, secure gainful employment, and be able to influence others around her.?

According to the State of Education in? Report 2015 by the Africa-America Initiative, investment in the early education of a child benefits not just the child but the nation as well.

While the objective of sending children to pre-primary schools is to get them ready for primary school, observable evidence suggests that many children in Africa do not have access to such education. The reason is not far-fetched, many of these prep schools are privately owned which many parents can’t afford. So, they are forced to send their children to mushroom prep schools that are ill-equipped and poorly staffed with incompetent teachers. Hence, it’s only the children of the affluent who derive the real value from such schools.?

The report concluded that though children who attend pre-primary schools benefit societies, Africa still lags behind other regions. That being said, the quality of the schools varies across Africa.?

Key statistics from the report include:

• In 2012, out of the 184 million children enrolled in preprimary schools worldwide, roughly 11 million children enrolled in pre-primary education in Sub-Saharan Africa.
• On average, 8 out of 10 countries with the lowest enrollment rates are from SSA.
• In SSA, only seven countries achieved the 80 percent or more enrollment target.
• Since 2000, 15 African countries have abolished fees which have significantly impacted the number of enrollments in primary schools.
• Enrollment rose by two and a half times in SSA between 1999 and 2012. On average, only 20% of children were enrolled in pre-primary education in Africa.
• In 2012, the number of students that enrolled in secondary schools globally was 552 million, 49 million were from Africa.
• After graduating from primary school, many children are finding it hard to attend secondary schools close to home

As noted above, the purpose of pre-primary education is to give children a headstart when they get to primary school. Studies show that many under 5 children have not been able to reach their full developmental potential because they never had the opportunity to attend pre-primary education. It goes without saying that pre-primary education has the capacity to improve primary education outcomes and enhance the future of children.

The United Nations Educational, Scientific and Cultural Organization (UNESCO) tend to allude to the report above, as far back as 2018, as it states that the enrollment level of children in primary schools has increased significantly to above 80% on average. But the African Union was quick to point out a lacuna in the huge enrollment data,? stating it missed out on huge disparities, system dysfunctionalities and inefficiencies in the education subsectors such as preprimary, technical, vocational, and informal education which are generally underdeveloped.?

It is well documented that many of the training and education programs in Africa are fraught with fault lines such as low-quality teaching, poor learning, inequality and exclusion at all levels. A report by the United Nations Development Programme, “Income Inequality Trends in sub-Saharan Africa: Divergence, Determinants and Consequences” posits that unequal distribution of vital educational assets such as schools is one of the main causes of income disparities in Africa. The report states that quality education is a key driver of social mobility and has the capacity to crush poverty though might not eliminate inequality. The authors of the report, therefore, advise governments in Africa to invest in quality education for children and youths including providing quality healthcare programmes.

Enrollment in both secondary and tertiary education is significantly low compared to enrollment in primary education. The authors posited that one in 100 children in Africa is expected to attend graduate and postgraduate schools compared to 36 out of 100 in Latin America and 14 out of 100 in South and West Asia. In any case, only 30-50% of students transition from primary to secondary schools while about 7-23% move from secondary to tertiary institutions.?

Reasons for this include low-household income and the lack of adequate investments by governments to level the playing field so that both the children of the poor and the rich can access education. It is well understood that subsidizing primary education has boosted enrollment levels by the government and international development organizations such as UNDP, and USAID but this has not been replicated in the secondary or tertiary education space.?

That being said, a UNESCO report says that many African countries have increased funding, on average, by 6% over the last decade. Many of them spend an average of 5% of their GDP on education which is second to only North America and Europe at 5.3%. In Burundi and Mozambique, education spending increased by 12% annually over the last decade. Only the Central African Republic reduced spending on education. However, in countries like Rwanda, Mali, Zambia and Guinea development aids account for 50% of the funding but as a continent, only 5.6% can be traced to funding by developmental assistants.

Education and economic development

Education is much more than attending schools and acquiring knowledge. It is an equalizer. It has the power to free a man or woman from every shackle of bondage be it social, economic, political and whatnot. ? As Chief Obafemi stated, “An educated individual is the strongest single factor in any nation’s rapid economic and social advancement”. The link between education and the economic advancement of nations is well known.?

Without saying too much, there is a correlation between the economic progress made by a nation and the level of education of its citizens. Studies have shown that the number of years a population spends in school affects its economic prosperity as reflected in the gross domestic product. People who attend college, for example, in many developed climes earn higher wages and are able to take care of themselves and their families. This is another way of saying that education helps to keep people above the poverty line. Studies show that one additional year of education can raise wages by 10%.?

For instance, the mean years for the US population aged 25 and above as of 2018 according to the World Bank were 13.71 years. The mean years of schooling for Germany as of 2018 were 13.8. In Singapore, the mean years of schooling for adults 25 years and above were 11.2 years as of 2020.?

The mean years for schooling in South Africa dropped from 10.3 years in 2017 to 10.13 in 2019. While the mean years for schooling in Nigeria increased from 5.25 years in 2006 to 7.2 years in 2021. In Kenya, people go to school for an average of 6.7 years. People attended school for 4.92 years in 2001, but that number has increased to 9.2 years in 2021. The global average number of schooling years is 8.7 years.

So, if the number of schooling years correlates with the economic prosperity of a country or region, then Africa really needs some doubling down to do. To do that, policymakers and national governments need to know why children or students drop off and hence limit the opportunities to beat poverty, improve their quality of life and contribute their quota to the economy of the continent.

Education is expensive. Ignorance is not an option worthy of any nation’s consideration. But money is not a solution to every problem. There are problems money can't solve. In 2019, the US spends $752.3 billion on its 47 million children in public schools, in 2017, it spent $700 billion - that’s an average of $12,400 per child in public school. To make sense of that figure, you would have to add the GDPs of Finland and Vietnam together and still not meet up. Yet the education outcomes in the US are not near the top ten globally.

That being said, governments and policymakers in Africa need to be more strategic about funding education. Off the cuff, one might suggest that the first thing to do is to increase budgetary allocation. But no. The first thing African countries need to do is to agree on where they will like to play in the next, say, 10 years or go. That is, they need to cast a long-range vision to determine what problems they would like to solve that would redound in gaining an advantage over the long haul. And develop the human capital through the apparatus of education, functional education that is, which includes technical education.?

The role of technical and vocational training

It is well known that Technical and Vocational Education and Training (TVET) has the capacity to close the skills gaps as well as productively engage the teeming millions of unemployed youths in many regions of Africa.?

Truth be told, one of the cogs in the wheel of technical and vocational training education is the perception that it is inferior to general academic education, which many consider mainstream education. In 2008, the Organization for Economic Co-operation and Development (OECD) countries spend o.4% of GDP on TVET, 4.2% of GDP on preschool, primary, and secondary education and 1.3% of GDP on tertiary education leading to a wide disparity in outcomes.?

But TVET is not without its problems, the absence of regulations, or a central regulatory body which can set and measure the standards of the TVET organizations. This has led to a lot of confusing and competing standards and hence colour the judgment of employers who depends on TVET organization for a pipeline of graduates.?

However, there are four routes to success:

1. Establishment of a coordinated ecosystem or central governance structure that can regulate the activities of TVET organizations. All stakeholders must bond together to align their objectives with the objectives of the central regulatory organization which has the oversight to set standards. This means having an oversight body that works with stakeholders to determine the long-range strategic thrust of TVET including the determination of the means of the accreditation of TVET programs with a view to making them attractive to students and potential employers.?

Germany, for instance, has an accreditation council which consists of nine organizations: representatives of government, trade unions, TVET providers, as well as independent scientific experts. The council makes recommendations to the Federal Ministry of Labour and Social Affairs which sets the regulatory standards the TVET providers must meet.?

To secure funding from the German government, the TVET providers must prove it has the capacity to train the employees, develop a curriculum for training and assure quality.???

2. Fund TVET based on the performance of the TVET providers.?

Incenting TVET has proven effective in raising their quality. The incentives should be linked to a set of key performance indicators. For instance, TVET providers should link students' outcomes to industry needs. The KPI will be the number of students that gets employment opportunities upon graduation, which becomes an incentive for granting more funds to the TVET provider.

Denmark provides basic funding for TVET providers such as teacher salaries, building maintenance and whatnot. But it also provides additional training based on the number of full-time students which forces TVET to only include courses that are industry-relevant and drive efficiency into the programme.

3. Parity between General Academic Education and Technical and Vocational Education and Training (TVET) gives an opportunity to students to switch from one to the other. The lack of interest in TVET stems from the fact that there is no linkage between the two streams of educational paths. But if the mobility between GAE and TVET is de-frozen such that students can move from one to the other without hiccups, the perception of TVET will tilt for the better.?

Singapore’s secondary school education system is extremely flexible providing opportunities for students to move from the GAE to the TVET track.

4. Sustained and collaborative support from the industry

Knowing that industry will always need TVET graduates either in the short or long term. Therefore, it is important for them to collaborate with TVET ecosystems to develop curricula for training manuals.?

Apprenticeship opportunities for students will also offer the opportunity for students to gain practical experience as well as secure gainful employment. The industry or private sector can also provide funding for the TVET ecosystem.?

For instance, the apprenticeship program practiced by the Igbos in the Southeastern part of Nigeria has proven to be so effective. One of the most successful businessmen in Nigeria, Cosmos Maduka, the founder and chairman of Lagos-based Cosharis Group is a product of such a TVET ecosystem.?

For instance, in Germany, industry players support the TVET ecosystem. To be sure, private sector players are responsible for two-thirds of the funding investment, which is €40 billion in TVET ecosystems while the government only foots one-third of the total funding bill.?

5. Education as an economic change catalyst.

No doubt, Germany is a global economic powerhouse. Right? Its mastery in automobiles is not in doubt, boasting top brands such as BMW, Audi, Mercedes Benz, Volkswagen and Porshe. That’s only part of its entrepreneurial success. What many don’t know is that the business model of modern universities as we know it today actually had its origin in Germany. It was the invention of a man named Wilhelm von Humboldt, a diplomat and public servant. He conceived and founded the University of Berlin with two clear objectives - (a) wrest intellectual and scientific leadership from the French and (b) harness the energy created from the French revolution and turn it against the French themselves.?

60 years later when the idea of a university as an instrument for catalyzing change was peaking in Germany, it caught on in the US in 1870. Before this time, around 1830, many of the colleges were beginning to deteriorate. By 1870, the colleges or universities had stopped growing - they boasted not more than half of the students they had in 1830 even though the population of Americans had tripled at the time.?

30 years later, a new league of “university presidents” had built s new set of universities that were uniquely American and ravishingly new. Soon after World War 1, the new universities claimed a worldwide reputation as leaders in academic scholarship and research just as the universities Humboldt built gained a worldwide reputation for leadership in academic research and scholarship.???

Now there is a direct correlation between education and the GDP of a nation. As I had argued above, the mean schooling years of a population are in tandem with its economic growth. In like vein, studies have shown that the establishment of universities has a remarkable impact on the economy of that region.?

One study covering 15,000 locations in 1,500 regions across 78 countries proves that an increase of 10% in the number of universities per capita is associated with a 0.4% increase in GDP per capita in that region. That is, in addition to the fact the university will contribute to the economic activities of that region, it would also drive the supply of human capital and innovation.??

Take the University of Oxford. According to a London School of Economics report, Economic Impact of the University of Oxford, the impact of the University of Oxford on the UK’s economy from 2018-2019 was valued at roughly ￡15.7 billion. Broken down, the University’s research and knowledge exchange activities were valued at ￡7.9 billion (50% of total value), while the value of the spending by the University and its colleges came to

￡6.0 billion (38%). The University’s educational exports were estimated to be worth ￡732 million (5%), while the University’s teaching and learning activities accounted for ￡422 million (3%). The University’s impact on tourism was estimated to be worth ￡611 million which is about 4% of the total value.?

Enter Stanford University. As you are aware, Stanford University has a long history in entrepreneurship and innovation that spans over 100 years. The university has created and taught some of the world’s leading startups and business leaders who have founded some of the greatest companies on planet Earth - Nike, Cisco, Google, Tesla, IDEO, Gap, Hewlett-Packard, Charles Schwab, Yahoo!, VMware and Netflix. It has also created founders of social enterprises and non-profits such as Kiva, the Special Olympics and Acumen Fund.?

According to a report funded by Sequoia in 2011, 39,000 companies can be traced to Stanford. Their economy, if they were a nation would have been the 10th largest in the world. The companies have created an estimated 5.4 million jobs and generated an annual world revenue of $2.7 Trillion.

So, without saying too much, there is a link between the knowledge-creating capabilities of a nation and its economic development. This reinforces the earlier position that the number of years of schooling of a population correlates with its ability to create wealth for its citizens while the productivity at the individual, household and national levels improves.?

So, back to my point about taking a holistic view of Africa’s economy to determine where it wants to play and win in the next decade or so. That would require leveraging Africa's strengths and opportunities and putting its best foot forward. The lowest fruit hanging is latching onto digital technologies to industrialize. Of course, the biggest problem combating the economy of Africa is that it is largely import-driven. That has to change, until Africa can turn its cocoa into chocolate, and transform its palm oil into an exportable brand in exchange for foreign exchange, its economy will continue to lag.?

My point is, Africa needs to know what needs it wants to meet in the world economy and then tailor its education to meet those needs. (I will share more thoughts on this in my subsequent newsletters). That being said, African countries should also learn to develop their individual strengths and capacities and promote intra-Africa trade. This is why the African Continental Free Trade Area (AfCFTA) ?agreement is a masterstroke availing countries in Africa to trade with one another. According to the World Bank, the agreement is worth $3.4 trillion and capable of lifting about 30 million Africans out of poverty.

Education as a master key??

So, if education is the master key for unlocking the potential and opportunities of millions of young Africans whether in Nairobi, Djibouti, Ibadan, Maputo, or Kinshasa, etc then what should governments and policymakers do to make education accessible for all and sundry? Two reasons put forward by a UNDP report are valid: many of the children who dropped off are from poor homes and the inability of many governments in Africa to provide the needed investments in education to level the field, be it for the offspring of a multimillionaire or the heir apparent of a smallholder farmer.?

That being said, according to the World Economic Forum, 19 of the 20 youngest populations are in Africa. The only outlier is Afghanistan. African countries in the top ten include Niger (15.2), Mali (16.3), Chad (16.6), Somalia (16.7), Uganda (16.7), Angola (16.7), Democratic Republic of Congo (17.0), Burundi (17.3), Mozambique (17.6), and Zambia (17.6). The implication is that Africa has an advantage over many developed economies whose populations are aging.?

Conclusion:?

In conclusion, unprocessed and unrefined gold is never attractive. And it is doubtless that it would command a premium price. But the fiery furnace of the purification process be it the Miller or the Wohlwill process, at a temperature of 1,0630c, drives every dross out without fail. With the Miller process, the quality of gold is 99.95% while the Wohlwill process assures gold quality of 99.99%. While gold is buried under the grounds of Africa, its most important resource is its humans, who walk “free” on the surface of the ground - perhaps God’s way of making a bold statement about their sheer superiority and ingenuity. Researchers have alluded to this having quantified the share of human capital as a share of total wealth, 62% which is 15 times the value of natural capital.?

So, it goes without saying that the best and most important resource Africa has is its people. Notably, the continent has the youngest population, an advantage or asset no other region can hold a candle to. But like raw gold or rock, it is of little value without going through the unfriendly heat that refines and purifies and lifts its value. Without saying too much, education is the metaphoric “refinery” for processing raw talent into refined and precious products.?

But let’s face it, the education system from the primary through to the tertiary levels in many parts of Africa is nothing to be proud of. Even though more children in Africa are attending schools than at any time in history, many of them can’t still read and write even after many years of schooling. Only one out of 100 students is expected to attend graduate and postgraduate schools in Africa, compared to 35 out of 100 in Latin America, and 14 out of 100 in South and West Asia. The scorecard is not only encouraging but disappointing.?

To turn the corner, Africa’s governments and policymakers need to do things differently. One, set audacious goals of where it would like to be in the world's “scheme of things”. This is one of the factors that pulled former third-world countries like Singapore and Malaysia out of the doldrums of retrogression. Agritech, automobile, fintech and the like. A good example is Renault’s automotive company in Tangier, Morocco. The company has become a sterling model for car brands the world over because of its zero carbon and zero industrial liquid emissions.?

Two, the human resource that would make this strategic goal a reality has to be trained. This is where education, that is, functional education comes to the fore. Right from primary through tertiary schools, curricula should be developed to sync with the bold aspirations of governments and policymakers.? For instance, Kenya likely wanting to position itself as a major tech hub introduced coding as a subject to be taught in both primary and secondary schools, becoming the first African country to do so.

Three, create multiple channels along the education stream. It is well known that education in Africa holds very limited opportunities for students. It’s a case of “one-size-fits-all”, if you don’t go through the General Academic Education route, your fighting chance at success is already limited. Whereas in other climes - Germany, Singapore, etc, there are other roads that get you to success in life. Technical and Vocational Education Training is one such channel. Without saying too much, governments and policymakers in Africa need to increase investment in Technical and Vocational Education Training. More so, a vibrant economy is the product of the productive activities of blue-collar workers e.g. bricklayers, plumbers, electricians, tilers, etc and white collared labour force namely doctors, engineers, nurses, architects, bankers etc. Increasing investment in TVET will raise the perception as well as attract more students to TVET. Also, the apprenticeship model common in the southeastern part of Nigeria is a business model worthy of replication, especially by the TVET providers.

Fourth, ensuring access has been the bane of education hiccups in many African countries. Poverty and gender inequality have been fingered as reasons why enrollment in schools is low. At the primary and secondary levels, strategies such as school feeding programmes have proven effective in lifting the rate of enrollment. State of Education in Africa Report 2015 noted that many African countries have abolished school fees since 2000 leading to a significant increase in enrollment rates.?

Fifth, redesign the universities in Africa to become the bastion of entrepreneurship and innovation. And not just centres of academic excellence, that is, the universities and polytechnics should be at the intersection of knowledge creation and commercialization of inventions mediating between the private sectors and the consumer market.

I believe Africa has the capacity to be more than what it is currently. Education has the power to unleash and unbridle its full potential and turn its raw gold into a refined value-adding resource.