Africa is a resource-rich continent. Less developed countries tend to have agriculture and manufacturing-based economies. Recent growth has been due to growth in sales in commodities, services, and manufacturing. In the Information Age, the global economy has moved further toward the knowledge economy.
The developments of past decades indicate that, globally, the higher education sector has moved from a state of decline and disrepair to a state of revival and revitalization. The 1980s was a period of decline in higher education when student enrolment fell, even in developed countries, and developing countries, especially in Africa, experienced the erosion of facilities and capacities. In a knowledge economy, a significant component of value may thus consist of intangible assets such as the value of its workers’ knowledge or intellectual property.
Innovation and infrastructure will close the technology gap and digital divide in Africa. Finding the right people can be more essential than knowing basic scientific knowledge for the success of innovation.
In recent times, growth in Africa has stalled; as Sub-Saharan African (SSA) countries have managed to keep the COVID-19 virus (coronavirus) under control with relatively low number of cases, the pandemic continues to take a toll on African lives and economies, economic activity is projected to decline by 3.3% in 2020, confirming the region’s first recession in 25 years. Africa’s economy experienced 3.4 percent growth in 2019, the African Development Bank’s African Economic Outlook 2020 report noted. With growth in 2018 at 2.3% [Chart above].
Poverty has increased 437 million of the world’s extreme poor are in SSA and 10 of the 19 most unequal countries in the world are in SSA. The World Bank projects that if poverty reduction measures and growth remain sluggish, Africa could be home to 90% of the world’s poor by 2030.
Coverage of Africa has increasingly focused on this growth, seeing the encouraging future prospects for many countries and the improved life chances for the younger generation as a result.
However, to date, there has been little focus on the flourishing academic and scientific success on the continent as countries move beyond agriculture-dominated economies towards a research and knowledge-based future.
The knowledge economy describes the contemporary commercialization of science and academic scholarship.In the knowledge economy, innovation based on research is commodified via patents and other forms of intellectual property.
The World Bank defines knowledge economies according to four pillars:
- Institutional structures that provide incentives for entrepreneurship and the use of knowledge
- Availability of skilled labor and a good education system
- Access to information and communication technology (ICT) infrastructures
- A vibrant innovation landscape that includes academia, the private sector, and civil society
The knowledge economy addresses how education and knowledge, that is, “human capital,” can serve as a productive asset or business product to be sold and exported to yield profits for individuals, businesses, and the economy. This component of the economy relies greatly on intellectual capabilities instead of natural resources or physical contributions. In the knowledge economy, products and services that are based on intellectual expertise advance technical and scientific fields, encouraging innovation in the economy as a whole.
A developing country has manufacturing and service-based economy, and developed countries tend to have service-based economies. Most countries’ economies are composed of each of these three major categories of economic activity, but in differing proportions relative to the wealth of that country. Examples of knowledge economy activities include research, technical support, and consulting.
The knowledge economy is a system of consumption and production that is based on intellectual capital. In particular, it refers to the ability to capitalize on scientific discoveries and basic and applied research. This has come to represent a large component of all economic activity in most developed countries. In a knowledge economy, a significant component of value may thus consist of intangible assets such as the value of its workers’ knowledge or intellectual property.
The knowledge economy describes the contemporary commercialization of science and academic scholarship. In the knowledge economy, innovation based on research is commodified via patents and other forms of intellectual property.
The changing nature of work in Africa necessitates transformation in education systems in order to provide the skills and competencies required by trends such as digitization and automation. High on the list of these competencies are 21st century skills (such as problem solving, communication, and critical thinking) as well as STEM (science, technology, math, and engineering), digital, and entrepreneurship skills.
Dynamic, student-centered pedagogies that complement competency-based curricula are required. When young people are empowered to ask questions on real world problems, and then supported to find their own solutions, they develop the capacity for critical thinking. Teachers can promote 21st century skills by fostering debates in class, project-based learning, and experimentation that allow students to apply in practice the knowledge they are learning in books and lectures. The good news is that these teaching methods can be incorporated into any course or extra-curricular activity, if the teacher is properly trained and prepared to do so.
The emerging interest in these markets among SMEs is a fact. This is encouraged by the standstill of many developed economies, and by a growing number of developing countries with good economic perspectives and a better business climate. Small- and medium-sized enterprises (SMEs) are a key contributor to economic activity around the world as an important source of jobs, growth, and innovation.
Innovation does not necessarily imply the invention of new or enhanced products, but encompasses any novel approach to business organization, marketing strategy or product distribution that allows the enterprise to differentiate itself relative to its market competitors.
As developing economies have weak institutional environments, and these are highly distant from SMEs’ home conditions in developed economies, those firms entering into developing economies should acquire new knowledge resources for a successful entry.Digitalization and the smart use of information and communication technologies (ICT) are critical determinants of successful innovation, competitiveness as well as growth, and offer several opportunities for MSMEs to strengthen their market position and resilience to demand and supply shocks.
As large enterprises increasingly exploit the advantages offered by the digital innovations outlined below, MSMEs must follow suit to avoid being sidelined or excluded from rapidly transforming markets and supply chains.
The capabilities and skills required to use various forms of digital technologies remain limited to a small segment of the population. Increases in higher level education and the existence of accessible online training initiatives are bringing digital skills to those able to access them.
However, low enrollment in basic education and the poor quality of that education coupled with a lack of digital skills in curricula is segmenting digital skills into a slim share of the population, excluding the poor from the benefits of the digital world. Improvements in digital connectivity, digital skills, digital financial services and other core areas of digital development, Africa can fully unleash new economic opportunities, create jobs and transform people’s lives.