THE SAOTI FINANCE LETTERS
I recently took part in a debate on a radio station. The discussion focused on the economic vision driving the African business class into the next decades. On the panel were the well known CEO of a large West African group of companies, a successful telecommunication entrepreneur and the founder of a business services company with a continent wide footprint.
Productivity and its evolution over time are the main drivers of a country’s economic growth, its international competitiveness, the profitability of its businesses and the standard of living of its citizens. It is therefore a fundamental indicator useful to governments and companies alike.
A high productivity reflects the ability to produce more with the same resources or to produce the same amount with less input. Africa struggling with a severe case of scarcity of resources, it would seem logical that increasing productivity be a top priority there.
The need to improve access to credit for small and medium size enterprises’ access in order to boost economic growth has now become a well received mantra, popular with International Financial Institutions and African politicians alike.
To be sure, the object of this consensus remains hazy, its outlines ill-defined and useful data hard to find. For example, the statistics provided by banking authorities in both West and Central francophone Africa do not segregate SME’s borrowings from other types of borrowings. Arguably, it’s difficult to understand, let alone manage, something that is not being measured.