Brain drain is a threat to Africa’s prospect to groom entrepreneurs
Soon after independence, African states were in significant need of skilled resources to run their affairs. To address this need, some students would be trained abroad, especially in the former colonizing countries and the Soviet Union.
Students trained abroad were expected and motivated to return to their home countries to contribute to their human resource needs. Other factors such as difficulties in finding jobs abroad, limitations around job reservations for nationals of host countries or downgraded appointments were further encouragement to return home and take jobs in countries of origin for African students. Newly independent African states offered enticing opportunities for their natives trained abroad.
With time, however, the home prospects began to fade and the expectations of the foreign trained professional started to get distant from guaranteed reality upon their return.
Some advanced nations started to grapple with or anticipate ageing populations, and their prospects of utilizing foreign labour matured.
Soon enough, the opportunity for employment in the western world was not only lucrative for the foreign trained African, but indeed became the dream of Africa’s home trained human resources. According to a 2018 report by the Mo Ibrahim Foundation, it is estimated that Africa loses around $2.0 billion through brain drain in the health sector alone, every year.
From the same report, it cost each African country between $21,000 and $59,000 to train a medical doctor. Nine countries of Ethiopia, Kenya, Malawi, Nigeria, South Africa, Tanzania, Uganda, Zambia, and Zimbabwe had lost more than $2.0 billion since 2010 from training doctors who then migrated.
Destination countries do not pay for the cost of training African doctors they recruit. For instance, one in ten doctors working in the UK comes from Africa, allowing the UK to save on average $2.7 billion on training costs.
Similarly, the US, Australia and Canada save respectively about $846 million, $621 million and $384 million in training cost from African physicians they recruit. It is estimated that Africa has lost $4.6 billion in training cost for home-trained doctors, recruited by these four-top destination countries.
The summary of the above narrative is that the African enterprise has not derived maximum benefit from a rising professional class deliberately formed to address post-independence needs. Considerable resources are invested in developing human resources some of whom are empowered beyond the rewards that their home countries can offer for their skills. They then proceed to seek better opportunities abroad, to the loss of African countries.
We can relate the post-independence human resource development drive to today’s focus by the continent on entrepreneurial skills development and trade revolution. Currently there is a huge thrust by African countries to empower and grow the African entrepreneur. This is being pushed through strategies to form one African market, efforts to open African skies and other initiatives generally geared towards revolutionizing trade on the continent.
For example, the African Continental Free Trade Area initiative is towards fostering specialization and boosting industrialization; strengthening regional and inter-state cooperation; increasing employment and investment opportunities, as well as technological development; providing the opportunity to harness Africa's population dividend. Put another way, it will bolster the entrepreneurship on the continent. There are also other related initiatives that seek to realize Africa’s youthful population into a strong entrepreneurial force.
A number of international firms and entities have embraced partnership with the African entrepreneurship drive. Jack Ma Foundation created the Africa Netpreneur Prize and the Alibaba eFounders initiative.
Over the next ten years, the Foundation will identify and support 100 African entrepreneurs with mentorship, training, and a total of $10 million in investment.
According to Ma, the next wave of major start-ups will come in the form of platform businesses out of Africa in sectors including e-commerce, logistics, fintech, big data and tourism.
Google recently opened a new artificial Intelligence lab in Ghana and in 2019, Microsoft launched its Africa Development Centre in Kenya and Nigeria. These are positive additions to homegrown initiatives and demographic advantages of the continent.
However, we need to be alert to the possibility that just as the post-independence drive of skilling Africans met with leakages of brain drain, this African entrepreneurial movement is prone to an even greater threat – capital flight.
As African countries, we must create the necessary conditions that will not only nurture but also retain entrepreneurial initiatives and their rewards on home ground to the maximum.
This will take maintaining favorable economic, regulatory and political conditions on the continent. If we fail on this, entrepreneurs will be formed in Africa and transplanted to other jurisdictions with their enterprises and capital. It is estimated that already, African loses about $ 50 billion in capital flight every year.
Mugisha is a Chartered Risk Analyst and risk management consultant
Raymond is a Chartered Risk Analyst and risk management consultant
