Originally Published in: Business Fights Poverty
But missing from the conversation were two critical numbers: 73 percent, the number of Somalis under the age of 30, and 67 percent, the youth unemployment rate. These two numbers hold the key to Somalia’s piracy problem. Youth unemployment and dissatisfaction feed not only lawlessness but also extremism, political instability, rampant poverty. Failure to address them spells doom for anti-piracy efforts that cost the international community hundreds of millions of dollars.
These two numbers are not unique to Somalia. Across the world, conflict and instability can have complex and varied causes, but in regions saddled with the dangerous combination of a large youth population and chronic unemployment, the risks are magnified. So what is the solution? It lies in those very same numbers: when you harness the inherent creativity and dynamism of large youth populations and connect them with the resources, support and skill sets to take control of their lives, you can create an entrepreneurship revolution that will create jobs, drive sustainable development and promote peace. The key is entrepreneurship.
Youth entrepreneurship accelerates peace and fights poverty in conflict-affected regions in four ways. In fragile communities, where often the private sector provides as much as 90 percent of employment, entrepreneurs are the key drivers of development. And when the largest sector of the population is under 30, as in Somalia, youth entrepreneurs can create sustainable jobs through self-employment.
When young people have opportunities for upward social mobility, they leave behind criminal and violent activities that drive instability. In Somalia, extremist groups have targeted youth for recruitment and they have been primarily successful because many of these youth are unemployed, live in abject poverty and have become disaffected. Self-employment can break that cycle of poverty and violence. Entrepreneurship also encourages a culture of change and innovation, and a feeling of pride in self-ownership, that can further benefit communities. And finally, in environments where governments and institutions are weak and infrastructure is poor, young entrepreneurs can provide goods and services that might not otherwise be available and improve the standard of living.
It is one thing to talk about an entrepreneurship revolution, but how exactly do you bring it about? Economic free fall, capital flight, and the collapse and deterioration of state and other institutions, have been the biggest barriers to entrepreneurship in conflict-affected countries. These challenges create two primary obstacles: access to capital, when youth do not have access to the funds they need to launch their own ventures; and capacity, when disrupted educational systems lead to limited managerial and technical expertise among young people. Improving the overall environment by developing infrastructure and rebuilding state institutions is important, but in the short term youth need financing and technical and entrepreneurial training.
Creating a supportive environment and building an entrepreneurial ecosystem is essential: fragile and conflict-affected states need assistance in rebuilding educational and public institutions, creating sound economic policies , rebuilding the financial and banking sectors, and developing laws and regulations that make it easier to launch and operate a business. In the short-term, however, youth entrepreneurs need an infusion of capital and building capacity.
Strategies to address these two challenges have emerged throughout Africa, from tech hubs in Kenya to youth enterprise incubators in Nigeria that provide seed funds and technical training. The story in conflict-affected regions like Somalia, however, is quite different. At a recent youth entrepreneurship summit in Mogadishu, the biggest challenge I faced was not in finding enterprising and dynamic youth, but hesitancy from potential partners who worried that Somalia, a failed state, was too unstable, its youth too radicalized and its infrastructure too shambolic. My argument: you don’t have to wait for a threshold of peace or stability to be achieved. You can make the biggest impact now. Youth in conflict-affected regions have the talent, the ideas, and the solutions to address the problems they face. They simply need the support and resources to make those ideas a reality.