The Eagle In A Storm Part 2

Changing our "wealth creation model."

Ever since I started school, my teachers taught me that our country was "rich" because we had many minerals, and we'd recite the list of minerals. By the time I finished secondary school, I not only knew my country was "rich," but that Africa itself was "rich" because we had so many natural resources.

Even though I didn't study geology, I could almost tell you where all these precious minerals and other resources were found: oil, diamonds, platinum, gold, copper… in places like Congo, there were names of some things I couldn’t even pronounce.

__Yes, Africa is so rich!!!

As a young student, if I thought about what the global buyers of Africa’s natural resources then did with them, it was only ever a superficial thought. But I soon realized something didn't add up…

__Sometimes it almost seemed that the "richer" a country, the poorer the people! But how could this be?

"1+1=2"! My primary school teacher drummed it into my head, right?

Then I got to secondary school and one day the teacher came in and said, "You know, there are situations when 1+1 does not always add up to 2." ?!

"I'm here to talk about mathematics,” the teacher said. “It's time to put away the arithmetic; this is senior school!"

"Senior school!"

I didn't end my study of mathematics in secondary school. I also studied it at university where I majored in engineering.

What was it the Apostle Paul said about putting away childish things?!

Let me return to the wealth of our nations: I left university in the early 1980's. In those days, it was not China that was rising into an economic giant, it was Japan! It was rising and overtaking every European country, until Japan was second only to America… It was so spectacular!

I first met a Japanese person when I was in my twenties and already working, yet I read every single book I could find about their prowess.

"Tell me about the minerals of your country?" I asked my Japanese friend.

"We have no minerals to talk of," he said emphatically and proudly.

"What do you mean you have no minerals?"

As we talked about the Japanese rise, I was reminded of my lessons in mathematics!

And so I had discovered it was possible for a nation to be "rich" without minerals!

"We buy your minerals as cheaply as we can, and then we turn them into high-value products."

"You mean you exploit us?"

"That's not the way we see it. After all, what would you do with them if we didn’t buy them? Do you know what we do with your platinum or your oil?"

Then he added:
# "Our wealth creation model as a nation is not based on raw materials and minerals."

"WEALTH CREATION MODEL?” What do you mean "WEALTH CREATION MODEL???"

Deeply troubled (even insulted) initially, I knew there was something more to learn if I avoided becoming emotional. The conclusions I reached changed the way I look at wealth, and totally empowered me. It changed my mindset.

The Tentmaker once said that our greatest battle is always in our minds… changing the way see things, particularly if we have held on to a certain perspective for a long time.

I hope it will do the same for you.

__Imagining new wealth creation models.

The talk with my Japanese friend had left me thinking deeply about how we in Africa think about wealth. Maybe, just maybe, there was another way to think about it?

Imagine if my teachers had taught me that we are "very rich" because we produce some of the smartest entrepreneurs in Africa… people with the know-how and vision to transform our minerals into such great innovations and products that we no longer export our raw materials all over the world!

From then on, every time I visited a country (or even a major city), and watched its economic activity, particularly places doing well, I would reflect on its "wealth creation model."

__Imagine a wealth creation model that doesn’t require any raw material endowment, like Silicon Valley, or Singapore!

I was fascinated by countries that rise without necessarily being underpinned by minerals and the exploitation of raw materials: Dubai, Mauritius, Singapore, South Korea, Switzerland, to name but a few.

I was also fascinated by countries where consumers can buy domestically-processed and finished products – value-added goods created from their own raw materials! I imagined a Nigeria which turned its oil into plastics, fertilizers, sports equipment, cosmetics, deodorants, and toothpaste!

It’s good to have oil and platinum, and to grow cocoa and coffee. But for citizens to benefit from a nation’s natural resources, it’s critical to have the best stewardship, and to eliminate corruption. Without a culture of respect for rule of law, all future wealth creation models are doomed to failure.

__The bottom line is: We can no longer allow our national economies to be underpinned solely by the export of raw materials.

If we’re not careful, we can even become dangerously addicted to them, such that African nations, workers, and citizens in general are forced to endure endless boom and bust cycles… When the price of oil is up, we're doing well; when it goes down, we're scrambling… copper, platinum: boom, boom, bust! It’s happening now.

We must prioritise the development of innovative capacity to redeploy our rich natural resources within our own economies. It goes beyond the simplicity of "processing" and so-called "beneficiation." That’s not enough. We must also pay attention to emerging technologies and how they’re likely to affect the businesses we’re familiar with today.

My appeal to this next generation is to get us out of a “wealth creation model” underpinned by export of natural resources. We can no longer afford to think of the wealth of our nations in terms of mineral and raw material exports. Not when you know there's a Silicon Valley; not when you know that Apple Computers Inc. is worth almost the same as Nigeria’s and Angola’s combined GDP! Not when you’re the generation that knows about Alibaba, Tencent, Uber and Skype!

As we see the price of oil, copper, and platinum plummet, let's stop and take a deep breath, and say to ourselves: "It's time to change our WEALTH CREATION MODEL.”

__Within the next 25 years, we must break our addiction to resource-driven economic wealth. It's time to turn to our African inventors, innovators and entrepreneurs.

Selah!