The passion behind Senegalese-born entrepreneur Magatte Wade’s perseverance runs close to home indeed: born in a small fishing village south of Dakar, Wade now runs organic skincare company Skin Is Skin, whose products are currently stocked in the upscale Whole Foods supermarket chain across the United States. She is determined to demonstrate firsthand the central role entrepreneurship plays in lifting communities out of poverty.
After leaving Senegal for France as a young girl, Wade says she was struck by the stark differences between life in her home country and the one in her new home. Why was one region of the world so wealthy, she wondered, while another languished in extreme poverty?
“Why is it that a couple decades ago, China, for example, was at the same level as many African countries. And yet today … countries like Singapore made it, countries like Hong Kong made it,” she commented in the documentary Made in Mékhé, produced by the Foundation for Economic Education (FEE), “Even a place like Dubai, bare land of sand—desert sand—and then all of the sudden within 12 or 15 years Dubai is one of the financial centers of the world. What happened?”
The question was one that would ultimately shape her career. In wealthier nations, Wade observed, commerce and trade was facilitated by authorities. In the economically successful cities of Hong Kong and Dubai, for example, it was historically much easier for individuals to start and operate a business than it was in Senegal. More business means more economic opportunities— not just for individuals but for the country as a whole.
Frustratingly for Wade, Africa has a long-standing problem with excessive regulations and red tape which makes starting a business profoundly difficult compared to overseas ventures. Despite a burgeoning entrepreneurial culture throughout the continent, many hurdles remain for individuals keen to kick off an innovative venture.
Wade’s home country of Senegal, however, is now making a serious effort to change all that. President Macky Sall has made developing an entrepreneurial culture one of his highest priorities, and his administration has announced a number of measures that look to make his pledge a reality. Government support has been a long time coming—the pervasive corruption that characterised the government of Abdoulaye Wade, Macky Sall’s predecessor, particularly thwarted would-be entrepreneurs.
There’s a different message coming out of Dakar now. The Sall administration recently announced a swath of funding, including €900,000 of sponsorship capital that it’s putting up alongside the Tony Elumelu Foundation. The financial help will be used to train some 100,000 entrepreneurs, especially women and young people, while a parallel government initiative will allow the creation of a small- or medium-sized enterprise (SME) within 48 hours.
In addition to this, plans for future reforms are already in the works, aimed at simplifying the registration fee system and revising minimum capital requirements for the establishment of a limited liability company from 25,000 CFA francs to 15,000 francs. Thanks to a partnership between Senegal and the United Arab Emirates (UAE), the Khalifa Fund for Enterprise Development (KFED) is currently building the largest business incubator in West Africa.
Senegal has reason to suspect that these initiatives to jumpstart business creation will be successful. According to World Bank forecasts, the country’s economic growth, already strong at above 6% annually since 2014, is set to hold its current rate—particularly noteworthy in the face of widespread stagnation elsewhere. Furthermore, political stability and good prospects in the agricultural and hydrocarbons sector paint a promising picture for the future of aspiring Senegalese entrepreneurs.
It surely doesn’t hurt that corruption, one of the biggest challenges facing African businesses, is far less of a problem in Senegal than it once was. Today, Africa is the world’s second fastest-growing region, though some 100 million more Africans live in extreme poverty today than they did in the 1990s. According to a report by Transparency International, institutions meant to control corruption remain endemically weak throughout the continent, and citizens are typically forced to pay bribes to access even the most basic services, like healthcare or education.
At the same time, African countries are estimated to be losing at least USD50 billion annually to illicit financial flows. Money that should be funding initiatives and public services is instead being funnelled abroad via offshore financial structures, often with the help of complicit banks, lawyers, real estate agents and accountants. As a result, legitimate African business owners and their employees are forced to scramble for the scraps of capital that remain.
Senegal, however, has been one of the continent’s star performers in stamping out corruption since Sall’s election in 2012. Dakar has been beefing up existing oversight measures, in addition to the creation of a new anti-corruption institution, laws to promote transparency, and the creation of a court that deals specifically with illegal enrichment. Whereas other political leaders fail to deliver on otherwise popular anti-corruption agendas, Sall may yet prove capable of breaking this mould.
Wade has said that she was inspired by her time in France, and the success stories of Asia and the Middle East, in her journey to becoming a businesswoman. If Sall’s reforms pay off, however, the next generation of Senegalese entrepreneurs will find their own inspiration much closer to home.