The biggest obstacle facing African businesses is not finance but the people who run the business, the Chief Executive Officer of UT Group, Prince Kofi Amoabeng says.
ï¿½A lot of people operating businesses in Africa lack discipline, values to society and respect for others. The key ingredient to a successful business is leadership with values.
ï¿½It is not a matter of preaching and not doing as you preach. You must consistently show that youï¿½re an embodiment of the values of the company,ï¿½ said Amoabeng in an interview with the Business and Financial Times. ï¿½Iï¿½m someone who always puts the interest of the company above my own. So my name grows with the company. If your name grows faster than the company, you kill it; conversely, the company will grow bigger and outlive you.ï¿½
According to the twice Ghanaï¿½s Most Respected Chief Executive Officer: ï¿½By our culture in Africa, we donï¿½t believe in equality of people but believe others being superior; so we look for leaders to worship.ï¿½ He noted that African entrepreneurs need to be train with a strong sense of responsibility, accountability, and a commitment to service for both the public and private sector.
The UT Group was started by Prince Kofi Amoabeng and Joseph Nsonamoah with very little capital. Today the Group has grown in leaps and bounds, metamorphosing into a group with seven subsidiaries and with presence beyond the shores of Ghana. For businesses to thrive in Africa, there should be the right climate and structures, said Amoabeng, adding: ï¿½For example, in Ghana this brings us back to the basics; that is, information about the people.
ï¿½You need to understand the demographics - population size of areas, district offices, addresses, lanes, houses, etc. We take these things for granted.ï¿½ He stated that Africa need institutions of government that are strong; an effective police service and an expeditious judicial system that dispenses justice in the shortest possible time.
ï¿½Imagine you have purchased land to do business and another person comes to contest ownership, and the case has to take five years to resolve. How can you do business in such a difficult environment?ï¿½ The continent has an extremely fragmented business landscape, and businesses - regardless of their size or structure - have to contend with numerous obstacles and barriers that make running a business difficult. Analysts believe excessive and ineffective bureaucracy often stifles and inhibits good business practice.
Africa's infrastructure is another issue that needs to be addressed, stated Amoabeng, explaining that day-to-day business across the continent is so often thwarted by practical struggles with transport, logistics, energy and technology. The costs of closing Africa's infrastructure gap are estimated to be around an extra US$20billion a year, according to the Commission for Africa.
Touching on Africaï¿½s development, he said the continent must find the right method to transform lives. ï¿½I hear people say Africa is developing, but I donï¿½t see it. Weï¿½re stuck, weï¿½re going backward.
ï¿½Development is leaving something better for the next generation, but in Africa is the other way round.ï¿½
Over the past two decades, Africa has achieved remarkable economic growth, outpacing most other regions in the world. Yet the benefits of greater investment and higher returns have been heavily concentrated among small segments of the population.
These disparities stem partly from corruption, but mainly they result from policies that place the majority of the continentï¿½s people and businessesï¿½especially small and medium-scale enterprisesï¿½at a great disadvantage.
But Amoabeng believes boosting Africa's SME sector will also be key to the long-term sustainability of the private sector on the continent.
In high income countries, the SME sector has been estimated to contribute more than 50 percent to gross GDP.
In low income countries, the contribution of the SME sector to gross GDP has been estimated at 16 per cent - and in most African countries, the SME contribution has been estimated at less than 10 percent.
ï¿½This untapped potential makes SMEs vital to the economic transformation agenda - not just in terms of GDP, but also the potential for job-creation, innovation, capacity-building and so on,ï¿½ said Amoabeng.
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