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Why Jack Ma’s $10 Million Won’t Save African Economy

Ann Sotnikova, Catherine Lange

Jack Ma, the founder of Alibaba service, announced the launch of the competition, during which African entrepreneurs will fight for $10 million of funding. The main aim is to support businesses in the emerging digital economy of the continent.

The businessman himself says: “As a fellow entrepreneur, I understand the importance of getting support during the early days. This prize demonstrates our support for the next generation of young entrepreneurs across Africa that is paving the way for a better future and impart positive changes in their communities.”

The initiative was called Netpreneur Prize. The statement said that starting in 2019 and throughout the next decade, African small businesses will compete annually for the prize of $1 million. Each year the Jack Ma Foundation will hold a tender, which will determine the winner. As a result, all 10 finalists will receive a grant for funding, as well as access to the community of African business leaders Netpreneur.

Of course, any initiatives that contribute to the development of states and communities are an important step towards the growth of the economy and its individual sectors. However, CEO of Khamissa Capital Fintech Advisory Rishad AHMED (Cape Town Area, South Africa) does not hurry with optimistic conclusions. He is sure that such awards are not enough for the development of the region.

“This money given by Jack Ma is simply a gesture of cooperation rather than creating significant change in Africa”, Rishad said in an exclusive commentary for Bitnewstoday.com.

According to entrepreneur’s words, there is a huge market for mobile payment solutions in Africa since most Africans access the internet via their cell phones. A lot more funds are needed for the development of fintech and blockchain solutions. Also, the focus should be on other parts of Africa, not just South Africa.

“I believe the agricultural sector has tremendous potential for growth and blockchain can provide great benefits in this sector, — Rishad says. — Renewable energy is another massive sector and the concept for mobile payment solutions for prepaid electricity will be large in the future. I think development finance institutions and foreign donor organizations need to invest more in Africa. Change can be achieved through skills transfer and bringing technology companies to help create the necessary business success is vital. Funding on its own is not enough”.

The other expert, Juan ENGELBRECHT, Entrepreneur and Investor, CEO of ICO called MOBU (Johannesburg Area, South Africa) has a more optimistic view:

“I think it is a good cause and the growth opportunities in Africa are more while the access to capital is less compared to developed markets. As China’s growth slowdown in terms of GDP is a known fact there will always be the search for growth and the tech sector always offers scope for innovation”.

According to investor’s words, it is definitely big for Africa. We have less liquidity and Zimbabwe is a great example where you can only withdraw $30 per day per person. Also buying power much more in Africa. And the labour is cheaper.

The contest will be open to businesses from all sectors, but the award will only be available to internet entrepreneurs who help to promote technology and innovation in Africa. Applications for the first year will open in January and the finalist will be announced in the second half of 2019.

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