Entrepreneurship in Africa – How young entrepreneurs are making a difference in rural areas
With ever increasing numbers of people migrating to cities, many rural areas are on the decline. Malian entrepreneur Halatou Dem and German corporate lawyer Lutz Hartmann are bucking this trend by advancing rural development in Africa.
Cities are often harsh, loud, anonymous places, marked by a hectic pace of life. But for many people living in rural areas across the world, they also represent hope for a better life, offering apparent opportunities for higher income and a secure future. Each day, tens of thousands of people, sometimes whole families, move to the world’s urban areas, drawn by the promise of greater prosperity. According to current predictions, two thirds of the global population will live in cities by the middle of the century.
It is therefore perhaps no surprise that investment in rural areas has long been on the wane. Roads are no longer maintained and hospitals become neglected, while schools and banks are forced to close. Most importantly, there is almost no investment in job creation. It is a vicious cycle, with a lack of decent income opportunities further reinforcing the trend towards rural-to-urban migration.
Failure to counteract this trend is a grave error, as strong rural areas are essential to a functioning economy, not least in terms of food production. It should not be forgotten that the majority of our energy is generated in rural regions, and they also provide the space required by important industrial sectors. They must therefore not be overlooked in efforts to achieve Goal 8 (Decent Work and Economic Growth) of the 2030 Agenda for Sustainable Development. To gain a deeper insight into these issues, we interviewed two people who, through great courage and initiative, have helped to create opportunities for training and employment and made important contributions to boosting economic growth.
Gluten-free grain from Mali
Halatou Dem is a young Malian entrepreneur. In 2011, she took the reins at Danaya Céréales, a company founded by her mother in the early nineties. Danaya Céréales mainly produces the gluten-free grain fonio (Digitaria exilis), one of West Africa’s most important food crops.
Halatou invested significant sums of money in new production buildings, which enabled her to increase productivity and meet growing demand for fonio. Her company has since tripled its output and now produces ten tonnes of fonio per day. An essential element in this success has been the training she has provided to her staff. She is personally committed to encouraging young people, and women in particular, to pursue a career in agribusiness.
As a young entrepreneur, you are making great strides in expanding your business. What are your main sources of motivation?
Halatou Dem: Danaya Céréales is a family-run business, founded by my mother Aïssata Thiam Dem in 1992. Her original vision was to help working women by providing them with pre-processed grain that they could cook more quickly. In the early days, our products were mainly destined for export and specifically for Malians living abroad, among whom demand was particularly high.
In Mali itself, using pre-processed products was frowned upon – the expectation being that everything should be prepared from scratch. This attitude has since changed and many Malians now use processed products.
Your aim is to encourage more young people to pursue long-term careers in the agricultural sector. How do you go about this?
Halatou Dem: By setting an example myself. I am keen to show young people the advantages of being independent and at the same time generating added value. It is especially important to demonstrate that this is an effective way of creating jobs.
You have completely transformed your company. Was it easy to keep staff on board or did they first need convincing that things were moving in the right direction?
Halatou Dem: All management decisions are discussed within the company and taken with the approval of staff. A company’s vision must be inclusive, not simply imposed from the top down.
You took out loans to fund the expansion of your company. Could you have grown without these loans? And was it difficult to obtain the funds you needed?
Halatou Dem: We invested large amounts of our own capital, but we couldn’t have grown so quickly if we hadn’t taken out loans. And yes, in Mali, loans are very difficult to obtain and very expensive.
How important is it that women in Mali have access to independent sources of funding?
Halatou Dem: Most women work in the informal sector. They find it difficult to get loans as the funding options they are offered are not tailored to their specific demands. Interest rates on microloans are also very high. Banks should adapt to the changes that have taken place in the job market and make a greater effort to understand the new dynamics at play so that they can better address the needs of their clients.
The majority of your staff are women. Is there a particular reason for that?
Halatou Dem: I have four sisters and I am committed to advancing women’s empowerment. This commitment is at the heart of my work and is the reason I am so highly motivated to make Danaya Céréales a success. My aim is to employ more women than men. Women are extremely dedicated workers and are often placed at a disadvantage at other companies.
You consider education and training to be key factors for success. Do you receive any support in this area?
Halatou Dem: As food producers, we are operating in a very sensitive sector. Our partners often invite us to take part in training courses. This enables us to keep learning and developing.
How can people in Mali be encouraged to start up their own companies?
In May 2017 you visited Berlin to participate in the Rural Future Lab. What new ideas or knowledge did you take back to Mali with you?
Halatou Dem: The Rural Future Lab was a very enriching experience, especially as it brought together young Africans and young people from the G20 countries. We clearly laid out our problems and proposed solutions in the “Berlin Charta”. As young leaders in the African agricultural sector, we need greater visibility so that we can have a more profound impact on our societies. The event in Berlin will help to achieve that.
A German entrepreneur in Ethiopia
The agricultural business set up by German lawyer Lutz Hartmann lies around 11,000 kilometres from his home town – in Ethiopia. For him and his business partner Oliver Langert, it is not only the profitability of their company, Fruitbox Africa GmbH, that is important, but also the creation of much-needed, well-paid jobs in rural areas.
Opinion on the subject of entrepreneurship in Africa
As a guest at the Rural Future Lab event in Bonn, I was impressed by the courage and enthusiasm of the 30 young African entrepreneurs in attendance, who have taken up the challenge of setting up successful businesses in rural areas. Their activities not only secure their own economic standing but also represent a significant contribution to the development of their regions. But I was also struck by the large number of problems and obstacles young entrepreneurs face.
I know that many Germany-Alumni, having returned to their home countries, have started their own businesses or set up projects that have a positive impact on their country’s development. We can all learn a great deal from these experiences – so I would invite you to write about your activities and post your comments in the community group “Start-ups and young entrepreneurs ”, where you will also find lots of practical tips on starting a business.