The concept of the knowledge economy describes trends in advancements in economies towards significant dependence on Knowledge, Information and the capitalization of high skill levels.
The Poland Knowledge Economy Assessment (KEA) has provided various policy options for securing additional sustainability growth and improving competitiveness.
Africa’s human capital needs to be explored and utilized more. Developed countries have realized this hence why they often set up bases in Africa to benefit from the innovation of their people.
Africa is renowned worldwide for its rich natural resources, both in material and human capital. Over the years, manufacturing and agriculture have mainly contributed to Africa’s economic growth. Both have sustained Africa’s economy to what it is now, but the world has drastically changed over the years.
Today the concept of a knowledge economy has propelled various economies to new heights. A prime example is Poland’s economic growth over the past few decades. Focusing mainly on its knowledge economy, it has transformed the lives of its citizens and its entire ecosystem.
Thus what is this newfound strategy that a country such as Poland capitalized on to reach new heights? Does it have the potential to transform Africa’s economy? The answer to both questions is a yes. Unfortunately, due to the rigid principles and slow adaptive rate of various countries, tapping into the transformative nature of the Knowledge economy has proven cumbersome.
What is it, and what makes it unique?
The concept of the knowledge economy describes trends in advancements in economies towards significant dependence on Knowledge, Information and the capitalization of high skill levels. Others refer to it as a system of consumption and production that revolves around intellectual capital.
A country’s ability to utilize and capitalize on scientific discoveries and applied research is acquired from learned individuals in various fields.
Most developed countries have focused on the knowledge economy to boost their growth. It capitalizes on intangible assets from a worker’s knowledge of a particular subject or field.
Developing countries, especially in Africa, mainly throve on a manual or intensive labour force to establish a manufacturing or agricultural ecosystem that allows them to thrive. However, the difference is vividly noticeable when comparing the economic growth rate of developing and developed countries. The critical difference is generally the Knowledge economy.
The Knowledge economy is a thriving place to produce and sell scientific and engineering discoveries.
Concerning globalization, the knowledge economy has slowly proved its efficiency compared to other types of economy.
What makes the Knowledge economy unique
The difference between the knowledge economy and its counterparts is that it heavily relies on factors gained from within a country. One critical element in producing a knowledge economy is emphasizing any country’s education system.
Developed countries are renowned for their education systems. In Africa, most of their education-driven citizens focus on pursuing their education outside its borders. Developed countries do not prioritize providing quality education only for the benefit of their young. They do so to create the foundation to excel in their knowledge economy to new heights.
The World Bank defines knowledge economies according to four pillars:
Institutional structures that provide incentives providing opportunities for entrepreneurship and the use of knowledge
Availability of skilled labour and a good and efficient education system
Acess to ICT infrastrcuture.
A vibrant innovation landscape includes academia, the private sector and civil society.
Through these four pillars, any nation can successfully establish a knowledge economy. Unfortunately, Africa has yet to excel in any of the above features, especially in its education systems.
Africa’s slow-paced education system
To successfully establish a knowledge economy, one must first establish a quality and proper education system to breed intellectual workers who can acquire the necessary skills. Africa needs to improve at the start of its journey to a knowledge economy.
Sub-Saharan Africa has the highest rate of education exclusion. Over one-fifth of children between the age of about 6 to 121 are out of school. In addition, one-third of youth between the ages of about 12 and 14. According to the UIS data, almost 60% of the youth between the ages of 15 and 17 are not attending school. These figures showcase the massive changes Africa’s education system requires.
The primary products of Africa are agriculture and manufacturing, which generally needs little to no educational background. Due to this, most African counties have shifted their focus to boosting their economy rather than upgrading their young. Furthermore, these numbers will grow since, currently, Africa holds at least 60% of the global youth population.
Fortunately, some African countries have emphasized the need for academic background for their youths. As a result, various governments, such as South Africa, Kenya, and Egypt, among many more, have created the initiative to upgrade the quality of their education system. In Kenya, their new government has emphasized the need for ICT-literate individuals. As such, there is a high rate of universities enrolling many students on their IT-based courses.
In most cases, the main problem often lies in the transition stage between secondary and tertiary education. Various circumstances have greatly diminished the number of African young enrolling in universities and colleges. According to Ms Lusigi, a strategic advisor for UNDP Africa. Several key factors contribute to this low rate. They include; limited household incomes, which limit children’s access to education. The second and equally significant contributor is the need for more government investment to create quality access to educational infrastructure. This is why university graduates often go abroad for further education due to their respective countries’ sub-standard quality of education.
How Poland reinvented their economy with the Knowledge economy.
Poland’s economic growth is greatly indebted to the country’s focus on the Knowledge economy.
As previously mentioned, a Knowledge Economy thrives on the implementation of the various skills of its citizens and skills to produce, create and advance the technological era of today. Poland’s economic success has been impressive, and it constantly increases with each end year. Its government has focused on improving the low-to-medium technology sectors and has utilized skilled labour acquired from within its country to improve these sectors.
The Poland Knowledge Economy Assessment (KEA) has provided various policy options for securing additional sustainability growth and improving competitiveness. According to their report, this is possible by creating an environment conducive to business development, investment, knowledge generation, and absorption via innovation and learning.
Poland’s key major aspects in a knowledge economy
This highlights two key aspects that Africa significantly lacks. The first is Poland’s initiative to create more knowledge among its citizens, followed by its utilization of its local talent. One of the many benefits of a Knowledge economy is the ability to utilize local talent. Unfortunately, this fact is still a hindrance to Africa’s economic growth. More often than not, Africa focused on exporting to a point we ended up exporting our human capital. We need to understand and appreciate our people’s innovation and brilliance.
Poland’s KEA also understands that to sustain a Knowledge economy, they have established efficient, relevant and lifelong learning systems. In addition, they have improved their ICT institutions and funding mechanisms that support research and development. Poland’s economic growth seeks to have an innovative environment. Especially since, with globalization, a country can innovate a specific item, need or concept that provides a significant lead in any financial year.
Poland has developed policies supporting inter-firm linkages and the capacity to absorb new knowledge rather than export it. This allows young minds to utilize these linkages and improve regarding research and development. They have made efforts to build institutions and provide financial incentives to increase Polish Research and development.
According to Poland’s government, “The time has come to invest heavily in policies that support development. The state intends on simulating these policies to ensure Poland’s economic growth.”
With Poland now focusing on a knowledge economy and innovation, it has the potential to surprise states such as Spain, Greece and Portugal.
African countries that are pioneering the Knowledge economy
Although Africa has a slow implementation of its education system, various counties within the continent have taken the initiative to pursue a knowledge economy.
Technology is widespread in certain countries such as Kenya, Egypt, Ghana, Tanzania, South Africa and Nigeria. These countries have held the spotlight in various innovative sectors for some time, and the knowledge economy is among the few where it slowly shines.
Tanzania takes a stand.
Unlike the limited number of resources required by various economies, the knowledge economy is filled with abundance. Focusing on improving local African nations has taken the first step to establish a knowledge economy. Tanzania is among the few countries to take the first step in establishing a knowledge economy by focusing on its pool of local talent apply here innovative ideologies.
Tanzania’s economic growth directly attributes to its new government’s recent macroeconomic stability and structural reforms. The new government structure understands that with the upcoming industrial revolution, only those who harness innovation will be able to prosper. Currently, Tanzania has lined its roadmap by establishing various plans by investing in human resource development and strengthening the innovation environments and their ICT structure. Tanzania intends to improve, which has already resulted from its previous initiatives.
This East African country improved its ranks on the Growth Competitiveness Index from 46 to 48 from 2017 to 2019, showcasing an increasing annual rate of 2.08%. At first glance, this may appear as a low metric, but given the amount of effort and stride it takes, it is considered a reasonable step within the knowledge economy. The country has led various innovative initiatives within its ICT sector. In such an attempt, they have lowered their SME sectors by providing financial services through services such as MPESA.
Tanzania accomplished this through the advocacy of the Vodacom Mpesa Women EMpowerment Initiative (MWEI), which saw a significant boost in their economic growth. This led t an increase in women’s social and economic growth in rural areas. Through MWEI, women engaged in self-employment and generated income that could contribute to their households and the national economy. By applying the ICT sector o the knowledge economy, Tanzania saw a positive increase in its economy.
Tunisia is currently an African country with a Knowledge economy. Their emphasis on promoting their educational ser has bore fruits t its current economic growth rate. Their constitutions include clauses that recognize the importance of a knowledge economy. It also emphasizes the need to support scientific research innovation and creativity. Currently, the economic development of its country is stable.
Its economy has been up on its feet during its political stability. The steady growth of its knowledge economy is a result of its political upheavals in 2011. Its government passed the Start-up Act in December 2019, intending to give its young and highly trained population new perspectives and opportunities for improving the country. This display of support from its government created the path it required to embrace the innovation that came for its local talent steadily. Today the country is known for its manufacturing industry that caters to the aeronautical industry.
This has significantly improved the demand for highly skilled individuals within the specific industry. As a result, the country conducted several measures to ensure that the s a conducive environment for learning these intricate skills. Aside from this, Tunisia has also advocated for innovation and skilled personnel within the service sector, private healthcare providers and tourism. As such, the country’s knowledge economy has thrived for the past decade, earning its title at the top position of the knowledge economy of Africa.
EGgpt is also another dominating figurehead within the knowledge economy of Africa. Within its new constitutions, Egypt also recognized the importance of a Knowledge economy and the benefits of its applications. The Egyptian constitution stipulates that the state guarantees the freedom of scientific research and encourages its institutions. This is a means toward achieving national sovereignty and building its knowledge economy.
Every research and development institute and project receives a percentage of the government’s expenditure, ensuring continuity and sustainability. Interestingly it also mentions that the Egyptian state will ensure adequate means of contribution by private and non-governmental sectors in the progress of scientific research. At the end of it, Egypt has implemented all these policies, and its Knowledge economy, specifically its ICT sector, has soared.
Regarding intellectual property, Egypt’s constitution also states that the state shall establish competent bodies to uphold the rights and provide any legal protection of intellectual property. This attributes the first steps for an African country to experience change.
What can Africa do to keep up
Establishing a knowledge economy is more accessible than most might assume. Using the four pillars depicted by the World Bank and having the government’s support, we can quickly establish a fully functioning knowledge economy in any African country. It will require just as much time, if not longer, to breed a country’s citizens into a specific career and establish the skills required to propel Africa’s economy.
One of the pillars requires a nation to establish Institutional structures that provide incentives providing opportunities for entrepreneurship and the use of knowledge. Let’s take into account Kenya’s Presidential Digital Talent Programme. This initiative is an opportunity for all ICT graduates within the country to acquire internships at different institutions. It recruits nearly 400 university graduates to work on significant projects in different ministries. With this program, Kenya is actively trying to utilize its talents and harness their creativity to build and invent.
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Searching for local talent
The Kenyan government also partnered with World Bank to set up a five-year private-public partnership worth $150 million. This program would help 280000 unemployed Kenyan Youth learn about employment opportunities and undergo employability training. A major demerit of various African countries is that we betray our people. Most of the time, an organization would only take the time to train new and fresh minds if it would cost them more time and money. Half of the time, what generally discourages the young even further is the common term “3 to 5 years of experience.” This essentially denies a country its raw local talent, a “diamond in the rough”, a chance to chip off their inexperienced and truly apply their innovative minds.
The second pillar includes providing an efficient education system. This aspect has been addressed over and over by different organizations and locals. If governments can focus on ensuring that most of their young acquire the necessary education, it can significantly propel their future economy. In addition, governments should advocate and emphasize sectors that can benefit their country. There are various programs offered in universities that are ultimately on-beneficial to an economy.
Emphasizing specific fields and establishing opportunities for them will increase human capital for later use. This is because today’s new jobs favour educated workers; thus, emphasizing their respective courses is an added advantage. Countries such as South Africa, Tanzania and Kenya have emphasized the need for more tech-related courses.
The next and most crucial pillar is access to ICT infrastructure. With the 4th industrial revolution steadily approaching, we as a continent have a window of opportunity. This Industrial revolution focuses on a digitalized world. As such having Internet access is a must. Providing additional ICT infrastructure ensures that Africa is ahead of this race. Several African countries have realized this truth and are increasingly digitizing their economy. The digital age is upon us; whether we hop on or not determines who will prosper and who will remain behind.
Africa is an ocean of untapped potential. Its human capital needs to be explored and utilized more. Developed countries have realized this hence why they often set up bases in Africa to benefit from the innovation of their people. Establishing a knowledge economy will propel Africa’s economy to greater heights. We must set up proper education systems and infrastructure and acknowledge and absorb our skilled workers.