The Managing Director, International Monetary Fund (IMF), Christine Lagarde, has said governments can create a foundation for innovation by streamlining regulations “so that everyone plays by the same rules and entrepreneurs are rewarded for their ingenuity.”
She said this while addressing representatives from the private sector, academia, university students, UN staff and the diplomatic corps, at a special event hosted by the Economic Commission for Africa (ECA).
Lagarde spoke on the theme, Economic Challenges and Opportunities facing the African Continent: The role of technology in supporting the region achieve more inclusive growth, and offered numerous examples of innovation that are transforming lives across the continent, such as drone technology, financial integration, and mobile banking.
“When I travel in Africa, I never worry that the dreams of the next generation are not big enough. The only question is whether we can create an environment where those dreams will have the chance to be realised,” she said.
Noting that youths in Africa comprised 75 percent of the working age population, she said by 2030, over half of new workers entering the global labour force will come from Africa.
“With the right strategy, this incredible surge could translate into a virtuous cycle of economic growth and development,” she said, cautioning that hundreds of millions of people will need better healthcare, more educational opportunities, and jobs – many in career paths that have not yet been invented.
Expressing concerns over uneven growth and a slowdown in some countries due to lower commodity prices, Lagarde decried that on a GDP per capita basis, 15 countries on the continent are expected to see a decline this year.
But the IMF Chief noted that achieving growth that is stronger, lasting, and more inclusive – one that leads to benefits and higher living standards – would require diversification, the right balance between investment and debt sustainability and harnessing technology to accelerate economic and social development.
“Technology does not hold all the answers. In fact, technology often raises new questions, including about the impact of automation. But there is no doubt technology is an important part of the story,” she said.
Lagarde also stressed that governments can do more than just encouraging innovation; they can also help lead the way themselves. Doing both – creating the right environment for technological innovation, and leveraging digital tools leads to more transparency, stronger accountability and “delivery of a better life for every citizen,” she added.