West Africa, a subregion comprising countries such as Nigeria, Ghana, Senegal, Cameroon, Cabo Verde, Chad, etc., has immense potential to become the driver of economic transformation across Africa and the world. Leveraging innovation and entrepreneurship is one of the keys to unlocking this potential. As economies globally continue to face shocks that the majority of them find hard to recover from, Africa will need to step up its contributions towards sustainable global development and prosperity.
According to a 2024 Global Economic Prospects report by the World Bank, global growth is projected to slow for the third year in a row—from 2.6% last year to 2.4% in 2024, almost three-quarters of a percentage point below the average of the 2010s. Developing economies are projected to grow just 3.9%, more than one percentage point below the average of the previous decade.
West Africa has witnessed increased innovative practices across various industries. Technological advancements, coupled with a young and tech-savvy population, have catalysed the emergence of startups and innovative enterprises. Countries like Nigeria, Ghana, and Senegal are becoming hotbeds for tech-driven solutions in financial, agricultural, healthcare, and more. In a report by the African Development Bank Group, 22% of Africa’s working-age population is venturing into entrepreneurship, with rates reaching as high as 40% in Nigeria.
One striking example is the fintech revolution, where companies leverage mobile technology to provide financial services to previously underserved populations. Mobile banking and digital payment platforms have not only improved financial inclusion but have also created new avenues for entrepreneurship, fostering the growth of small businesses and enabling them to participate in the formal economy.
Entrepreneurship in West Africa is not limited to the tech sector. Many other factors have laid the groundwork for the current state of West Africa’s economy. The West African subregion has a history of resilience in the face of challenges, with entrepreneurship deeply embedded in its societal fabric. Traditionally, local markets and trade routes facilitated commerce and created a foundation for entrepreneurial ventures.
Traditional sectors, such as agriculture, are experiencing a renaissance through innovative approaches. Agripreneurs are leveraging technology to enhance productivity, improve supply chains, and promote sustainable farming practices. This shift not only ensures food security but also contributes to the region’s economic diversification. West Africa’s youthful population presents a demographic dividend, offering a vast pool of talent and creativity. Coupled with strategic investments in education and skill development, it has further empowered the workforce to drive innovation and entrepreneurship.
In West Africa, nations are grappling with endemic youth unemployment and the rising youth population. Entrepreneurship and innovation in various sectors promote economic diversification and foster the creation of new businesses, which, in turn, generate employment opportunities. By encouraging innovation, West Africa can address the challenge of unemployment, particularly among the youth population. Innovation and entrepreneurship empower SMEs to grow and contribute significantly to GDP. While start-ups and small businesses are often significant contributors to job creation,.
The incorporation of entrepreneurship and innovation into peacebuilding is primarily driven by its potential to generate income, employment, and economic advancements. Building capacity has been known to play a huge role in poverty reduction, which is identified as a root cause of violence. At the same time, it contributes to raising living standards by identifying unmet needs. The emergence of social entrepreneurship and innovative ideas is addressing societal challenges, from education to healthcare.
Initiatives that blend profit-making with social impact are gaining traction, showcasing the potential for businesses to be agents of positive change. Innovation and entrepreneurship that are guided by principles of sustainability can contribute to long-term economic development. This involves considering the social and environmental impact of business activities, promoting responsible business practices, and addressing societal challenges through innovative solutions.
Another crucial aspect of shaping West Africa’s economic landscape through innovation and entrepreneurship is fostering regional collaboration. Countries within the Economic Community of West African States (ECOWAS) can leverage synergies, share best practices, and create a unified market that facilitates the free flow of goods, services, and ideas. Collaboration on research and development initiatives can lead to breakthrough innovations that address regional challenges and promote shared economic growth.
While West Africa is experiencing this wave of innovation and entrepreneurship, it is not without its challenges. Access to funding, regulatory barriers, and infrastructural constraints remain impediments to the full realisation of the region’s entrepreneurial potential. The development of a supportive entrepreneurial ecosystem is very essential. Governments and stakeholders must work collaboratively to create an enabling environment that fosters innovation, protects intellectual property, and supports startups through incubation and mentorship programmes to allow Africa to participate more effectively in the global market.