In my vision, I propose a National Commission for Industries Development (NCID) for African countries, funded by revenues from mining of metals and minerals or as decided by the government. This commission will regulate the establishment of startup industries, assess their performances and provide capital to promising industries whose products appear globally competitive

Africa cannot rely on Foreign Direct Investment to boost its economy. Understanding this isn’t about having a degree in micro-economics or being a math wizard – all you need is to comprehend how economics works. Governments need to create policies that encourage citizens to set up industries;light, heavy and high tech industries. There’s a large pool of highly-skilled citizens resident outside the continent (and even within) who will be swift to return to their home countries following moves by the government such as the establishment of a National Commission for Industries Development (NCID). Governments should also establish an Authority for Scientific Research.

The National Commission for Industries Development (NCID), in my vision, will also serve as a unit of governments venturing into partnerships with private industry founders. Industrial/technology entrepreneurs who require financial support to bring their big ideas to life can submit proposals to NCID for review, and successful ones, after following due procedures will be required to issue certificates for shares to NCID. This makes the “National Commission for Industries Development” part owner of the business. If properly managed, this will lead to establishment of industries owned jointly by the government and private sectors. It will drive export and boost value-added component of exported goods. Interest of citizens will move towards setting up industries, and citizens with enough capital will set up industries without intervention from governments. Competition in the continent will rise – which is very healthy to drive economic growth. Unsuccessful businesses will fade out of business, leaving globally competitive ones in the race. Priority will be given to certain industries, particularly to those manufacturing import-substituted goods. African countries will begin to spend less on import, and will generate more revenues from exports. This is one of the ways African countries can build industrial economies and become globally competitive.

The education system has a relevant role here. Africa’s education system tends to depend on learning by heart rather than on developing creativity and innovation. A sophisticated or high-tech industrial sector for countries requires highly trained and educated labor force. The spread of education, particularly tertiary institutions focused on technology will produce nationals with required skills.

Industry organization is also important. Let’s look at Japan and the United States; two advanced economies. Japan has a vertically integrated and hierarchical industrial structure centered on manufacturing. In the US however, building horizontal industrial economy that includes platforms and ecosystems is paramount. Japan’s strength has continued to lie in manufacturing. When it comes to services and soft goods (Softwares, contents), it has either failed to produce competitive companies, or these companies have failed to establish themselves in foreign markets. A growing share of global value chains is now captured by services and soft goods, such as software, while the percentage which accrues to manufacturing is declining. In the past 20 years, many of the companies that have been created or grown rapidly have software and information platform at their cores: Online search, information and ecommerce (Amazon, eBay, Bloomberg, Facebook), PC (Operating systems like Windows), the internet (web browsers such as Internet explorer, Safari, Firefox), Digital Media (Apple’s IPod and ITunes combination) etc.

There are, for example, no Japanese global information services companies comparable to Google, Bloomberg and Thomson Reuters, nor is there any truly global Japanese hotel chains. No Japanese corporations compete internationally with UPS, FedEx and DHL. There are no international Japanese consulting or accounting firms. Japanese companies are also absent from international markets in sectors which are very strong at home; sectors like mobile telecommunications and Anime production. Japanese policymakers are beginning to realize this, and may take swift steps towards addressing it.