Africa Week Celebrations - Ensuring a sustainable future for youth in Africa

Excellencies, Ladies and Gentlemen,

It is a great pleasure to be here with you today. I am particularly pleased to be present at the opening of the celebrations of this year’s Africa Week. The focus on creating a sustainable future for our continent’s young women and men is a cause that I personally am adamantly committed to.

At IFAD, we recognize that poor young people living in rural areas are among the most vulnerable members of society. But we also know that, as the farmers and producers of tomorrow, they have the potential to help feed us all and thus solve one of the biggest challenges facing the world today. We should remember that these young women and men, with their hopes and dreams, hold our planet’s future in their hands.

Enabling these young people to gain access to investment and financial services means enabling them to start and expand businesses. It means giving them the confidence to take an active part in community life. And most of all, it means empowering them to contribute their youthful energy and creativity to their countries and their continent.

Unemployment and underemployment
Unemployment is a major problem for urban youth, and government policies and interventions tend to focus on their needs. But for young women and men in rural areas, underemployment and outright exploitation is often a harsh fact of life. Today, some 300 million young people worldwide work, but earn less than US$2 a day. In rural areas, they are often employed in the informal sector and also in unpaid family work, especially in agriculture.

To make a real difference
In order to make a real difference to the lives of these young women and men, governments and development agencies must do three things: invest in agriculture; boost economic growth in rural areas; and invest specifically in young people themselves.

Invest in agriculture
As I have said many times before, and I shall continue to say it: African governments must ramp up their investment in agriculture to meet the Maputo target of 10 per cent of GDP. Some countries have already met this target – and they should be loudly congratulated for doing so – but many are still falling far short. I call on those countries to make a special effort to boost their public spending on agriculture – because time is not on our side. 

Boost economic growth
Economic growth in rural areas both fuels and is fuelled by growth in the agricultural sector. Both are underpinned by functional infrastructure – including roads, energy supplies and markets. A vibrant rural sector generates local demand for locally-produced products and services.  In turn, this can spur sustainable off-farm employment growth in services, agro-processing and small-scale manufacturing. This is crucial for rural employment. Without local jobs, young people will be driven away from rural areas in search of work in the cities. And then who will feed the world in 2020 or in 2030?

Recognizing smallholder farms as businesses, irrespective of their size or scale, is an important first step towards making the rural sector a viable choice for Africa’s young people. Unfortunately, however, too many smallholders in Africa are neither productive nor profitable, and are trapped in a cycle of bare subsistence.

Governments, donors and private sector operators need to act – individually and collectively – to take smallholder farms beyond subsistence, into viable businesses, particularly for women and young people who shoulder the future of African smallholder farming. We need to turn smallholders into entrepreneurs, into the main engine of economic growth. We need to make agriculture a business opportunity for Africa’s young women and men. We need to make agriculture a pathway out of poverty.  

Investing in young people
Investing in young people themselves is the bottom line. In many developing countries today, young women and men make up some 50 per cent of the rural population and the growth of the youth sector is not projected to peak for another 25 years. We believe that investing in rural young people is an investment in our future.

If we neglect them now, as their parents were in many cases neglected, we will have the same capacity issues in the future that we have today. We must ensure that they gain the skills and confidence they need to run profitable farms and innovative businesses and become the community leaders of tomorrow.
There are three keys to enabling young women and men to fulfil their potential:

• Education
• Empowerment
• Access to finance

Education
As the parents among you will know, children and young people in developed countries take their schooling so much for granted that some go out of their way to avoid it. In developing countries, girls and boys know that learning to read and write, and continuing their studies, will make a huge difference to their futures. Yet still today, in many countries, one young person in every four is illiterate – and most of them are young women.

The proportion of young people with basic education deficits is greater in rural areas than in urban. Many rural children are taken out of school early to be put to work on plantations and family farms – in fact, most child labourers work in agriculture – some 60 per cent.

In parallel to our drive to bring young people into the active workforce, we must continue to fight against child labour, to ensure that the dividing line between childhood and young adulthood is respected.

At IFAD, we know that basic education is essential to poverty eradication. We also support vocational training for young people, particularly in off-farm and non-farm activities. A successful project that we’re funding in Madagascar, is providing apprenticeships and job opportunities for young rural workers and building a stable workforce for Malagasy small businesses. So far, 400 young apprentices have been trained, and we aim to reach 8,000 over the next five years.

The project matches young women and men to businesses of all kinds, including pottery-making, tool-making, weaving, shops and farms. We have already seen that apprentices take their new skills home with them, teaching their parents new techniques and making their families more prosperous.

Empowerment
When young people gain the skills and confidence that they need to participate in community decision-making and take management roles in local organizations, they improve their own situations at the same time as they contribute their energy and creativity to their communities. By taking leading roles in rural youth organizations, for example, they make a difference for other young women and men in other villages and other districts.

I recently heard from colleagues about a 19-year-old young woman called Ibtsam, from a village in Yemen. Ibtsam gained business skills and took out a loan through one of the ongoing projects we fund, in order to help her father expand his shop. Through her financial contribution, she gained part ownership of the family business and she earned the respect of her community. She now serves as the chairperson of the village savings and credit association, which has 35 members.

Access to finance
Targeting microfinance services to young people in rural areas is vital. We know that education and training alone are not enough to guarantee sustainable self-employment.

In Benin, IFAD has been working since 1997 to support the establishment and growth of financial service associations owned by rural people that provide credit and savings products. After 12 years of steady work, we know that these village banks, as they have come to be called, have an impressive record of providing credit to young women and men.

There are now more than 170 village banks across Benin and they have provided about FCFA 13.7 billion – or US$27.4 million – in credit to 72,000 clients in rural areas. Nearly half of this amount has been given to young women and men. Repayment rates have risen gradually over time, and last year stood at a healthy 95 per cent.

The loans have been used for a wide range of activities. Micro entrepreneurs have invested in setting up or expanding their businesses, from taxi-bike companies to shoe shops. Farmers have been able to buy improved seeds and other inputs, and increase their productivity. Parents have sent their children to school and families have repaired and restructured their homes.

We know that it takes time to establish sustainable financial institutions, particularly in rural areas. Our goal is to support them until they are viable and self-sustaining. The signs are good. Some associations are beginning to establish links with commercial banks for refinancing and other services, and Western Union and many other similar organizations have also started working with them to provide remittance services.

Closing remarks
Ladies and Gentlemen, we must not fail these young women and men. 2010 is the International Year of Youth and we must use this to raise awareness and galvanize action. With our support and our commitment, young people living in poverty in rural areas can make the change from being some of the most vulnerable people in today’s world, to being active, productive and influential members of society. Today, they need our support. Tomorrow, we will need their contribution, their creativity, their commitment and their leadership.

Thank you for your kind attention.

24 May 2010, Rome, Italy