The United Nations Development Programme (UNDP), together with some African countries, have launched the Timbuktoo initiative, positioned to be “the world’s largest financing mechanism” to support Africa’s startup ecosystem.
The initiative was presented by African presidents Paul Kagame of Rwanda, Nana Akufo-Addo of Ghana, the secretary-general of the African Continental Free Trade Area Secretariat, Wamkele Mene, and the administrator of the UNDP, Achim Steiner, at a special session of the World Economic Forum held last week in Davos, Switzerland.
According to the Disrupt Africa website, timbuktoo aims to bridge critical gaps and work with African governments, investors, companies and universities to support the continent’s start-up ecosystem. The ambition is to mobilise and invest one billion dollars (around 63.2 billion meticais) of commercial and catalytic capital to transform 100 million livelihoods and create ten million new decent jobs.
“We cannot accept that another generation of young Africans does not have the necessary tools to reach their full potential,” said Kagame, who announced an immediate contribution of three million dollars (189.7 million meticais) to start the timbuktoo African innovation fund, which will be based in Kigali. “With timbuktoo’s target of one billion dollars, we can create more opportunities for young Africans to make good use of their talent and creativity.”
Akufo-Addo said that for many African countries the main challenge is to ensure that the right structures are put in place to enable young people to develop innovative and attractive companies that can make a significant contribution to generating jobs and sustainable economic growth.
“I’m excited about the future of our continent. I look forward to seeing us create a future where innovation is encouraged, ingenuity is supported and prosperity is shared,” he said.
“Timbuktoo is a new development model. We’re bringing together key players to lobby on all fronts at the same time. From favourable legislation for startups, to building world-class startups, to reducing the risk of capital to increase investment, across Africa, we aim to fill critical gaps and support the startup ecosystem. This will allow innovations to grow and benefit people across the continent and other parts of the planet,” emphasised Steiner.
Currently, according to Disrupt Africa, the continent’s share of the global value of startups is just 0.2 per cent, compared to 2 per cent of the value of global commerce. The vast majority, 89 per cent, of venture capital entering Africa is foreign and 83 per cent is concentrated in four countries: Nigeria, Kenya, South Africa and Egypt, with more than 60 per cent of the capital flowing into one sector, fintech.
