The TRUE Africa 100 is our list of innovators, opinion-formers, game-changers, pioneers, dreamers and mavericks who we feel are shaping the Africa of today and tomorrow. We’re featuring them over 100 days and we’ve asked them all three questions.
Originally from Botswana, Bame Pule is the CEO and founder of the private equity company Africa Lighthouse Capital, which is based in Johannesburg. He has previously worked at Goldman Sachs, ShoreView Capital and Actis and has worked in private equity in Africa since 2006. He holds a MBA from Harvard Business School.
He is passionate about entrepreneurial and private-sector development in Africa. Bame Pule has advised African billionaires across the continent on transformational development-driven projects.
How do you think Botswana can be used as a model for the development of the continent?
Botswana is a rare example of an African country using its natural resources (mostly diamonds) to generate substantial income for the government and using that income to provide high quality social services with a strong developmental impact.
At the time of gaining independence in 1966, Botswana was one of the poorest countries in Africa. By the 1990s, Botswana was a middle-income country with one of the highest incomes (measured in GDP per capita) in Africa.
Botswana managed this by forging an alliance with a global natural resources company that had both alignment and transparency and by putting in place strong governance structures.
Botswana has maintained a peaceful and inclusive democratic political process since its founding. This political openness has come with a high level of transparency and accountability.
First, the government of Botswana did not just give mining licenses to private companies. The government set up a joint venture with the largest diamond mining company in the world (De Beers) called Debswana. Debswana is the company that operates the large diamond mining operations in Botswana. The government of Botswana is involved in its management and on the board of directors. By being a shareholder in the company, the government of Botswana has visibility to all activities undertaken by the company and can influence the company to operate in a way that is in the long-term interests of the country.
Second, Botswana has maintained a peaceful and inclusive democratic political process since its founding. This political openness has come with a high level of transparency and accountability. Botswana has also been lucky to have presidents who were largely ethical and had strong visions for economic development. As a result, the government of Botswana has been effective in using the proceeds from Debswana to spend on infrastructure and social services, thus lifting people out of poverty and creating a middle-income economy.
In the last five years, the government has used its relationship with (and leverage over) De Beers, to ensure that De Beers moves more of the value chain in the global diamond industry to Botswana.
Botswana has remained at the forefront of strategies to use natural resources to develop the local economy. Whereas the focus in the 1960s was on structuring the right partnership with a global mining company, the focus is now on moving up the value chain to ensure that most beneficiation prior to final consumption occurs within Botswana.
In the last five years, the government has used its relationship with (and leverage over) De Beers, to ensure that De Beers moves more of the value chain in the global diamond industry to Botswana. Whereas Botswana used to export rough diamonds, the government made it a condition for the recent renewal of Debswana’s mining license that De Beers move cutting, polishing, sales, and marketing operations to Botswana. This has resulted in a new diamond beneficiation industry developing in Botswana with the number of Botswana citizens with jobs in the diamond industry increasing substantially.
How do you see the relationship between Africa and China developing?
The relationship between Africa and China appears destined to become a more mature and commercial relationship than it has been in the last 15 years as Africa’s economies ‘emerged’ from backwaters into frontier and emerging-market status.
Historically, the relationship has been largely government to government and has been driven by Chinese investment in African natural resources and infrastructure. This was mostly due to the economic status of both China and Africa: China was urbanising rapidly and building new factories and needed raw materials for both; Africa had a significant infrastructure deficit and under-developed economies in which mining as well as oil and gas were one of the few industries of scale in which foreign investors could invest large amounts.
Those countries that are able to develop world-class power and logistics infrastructure will also become targets for the relocation of Chinese manufacturers in low-end manufacturing to Africa.
Nowadays, China’s economy is repositioning away from growth driven by infrastructure and new factories to growth driven by domestic consumption. At the same time, African economies are also evolving and beginning to diversify away from natural resources to include sectors such as consumer, telecoms and financial services etc. As the trade and investment relationship between Africa and China matures, there are openings for the relationship to become less government-to-government driven and for more private sector players to become involved. The newer sectors for growth are less suitable for government-to-government deals and will likely see more private sector-to-private sector engagement. As the players and sectors diversify, we are also likely to see more civil society engagement between China and Africa.
Those countries that are able to develop world-class power and logistics infrastructure will also become targets for the relocation of Chinese manufacturers in low-end manufacturing to Africa as Chinese wages continue to increase and become globally uncompetitive. Trade, investment and diplomatic relations between Africa and China should flourish as the basis for a mutually beneficial relationship. This will strengthen as the economies of Africa and China evolve.
We’ve asked all of our TRUE Africa 100 this last question. Who’s your African of the year?
Chimamanda Ngozi Adichie for being a contemporary and globally relevant African voice that is heard.
For too long, Africans didn’t speak to the world. For the last several decades, we too often only heard pronouncements from non-Africans about our impending doom. The era is epitomised by the infamous cover story by the Economist in May 13, 2000, the ‘hopeless continent’. Ironically, the longest and most significant period of sustainable growth in African economies was well underway when the article was written.
Chimamanda Ngozi Adichie is an artist, a creator and thus personifies the vitality of contemporary African culture.
In the last few decades some Africans, often presidents and ministers of finance, have gained global clout and have managed to promote the continent to investors. But too often even these government officials could not paint a holistic picture of Africa; could not articulate the aspirations of the masses they were elected to represent. And in a youthful continent, they were often too culturally distant from young people. And while their audience was important (the Davos set), it was also very narrow and did not include important constituencies outside Africa.
Chimamanda has changed all of that. She has lived on the continent and can speak authoritatively about it. She speaks from the bottom up rather than top down. She exudes youthful optimism while being mindful of history and culture. She is an artist, a creator and thus personifies the vitality of contemporary African culture. She speaks in a way that resonates not only with Africans, but with people from all walks of life around the world, most of whom are not Afrophiles thus spreading Africa’s stories much further than was previously the case. She is frequently published in the New York Times writing about a wide variety of subjects and thus influences the opinions of leaders across industries.
She does not purport to speak for anyone but herself. But in speaking of Africa and Africans and in being heard she has brought a new voice to the conversation about Africa.
Come back tomorrow for the next TRUE Africa 100 and keep up to date using the hashtag #TRUEAfrica