Africa stands at a defining moment as a surging youth population and rapid urbanization intensify the demand for jobs and inclusive services amid declining traditional aid. Through the African Union’s 10-Year Strategy, efforts are gaining traction to scale the continent’s 2 million social enterprises, a vital engine for employment and locally-driven growth.
At Davos 2026, the panel “Africa’s Job Engine” framed the continent’s employment challenge as “boom or bust” amid a youth surge and falling aid. With 13 million young Africans entering the labor market annually for roughly 3 million formal jobs, speakers argued that scaling social enterprise and accelerating the African Continental Free Trade Area (AfCFTA) are central to a jobs strategy.
Ethiopia’s finance minister outlined three current job pathways—agrifood value chains, light manufacturing via industrial parks, and urban services—while naming the binding constraints: “high cost and unreliability of production… logistics bottlenecks and critically, energy availability.” He called for an AfCFTA “production compact” that guarantees power, forex and logistics for job-dense sectors, and warned that “trade integration without energy integration does not create jobs.”
Nigeria’s foreign minister emphasized macro reforms—currency stabilization, subsidy removal, and an “Electricity Act” that “uncoupled… power generation” to attract private investment—plus credit guarantees and consumer credit infrastructure to formalize enterprise. He cautioned against overloading AfCFTA with “lofty goals” like labor and environmental standards, urging speed and digital trade.
Ushahidi’s Angela Oduor Lungati highlighted the scale of social enterprise: 2.18 million firms, led “1 in 2” by women, yet constrained by a “missing middle” finance gap. Entrepreneurs in the room stressed that poorly designed taxes and data rules can erase jobs, underscoring the need for structured government–innovator dialogue.
A very good morning to all of you. Thank you for taking time to be with us this morning on the first day of the World Economic Forum in Davos for 2026. I'm Godfrey Mutizwa, I'm a journalist, I'm based in Johannesburg. I tell African stories and have been doing so for the past 40 years or so. So I've seen a few, I thought to begin the session, I'm going to be a little bit melodramatic. That's the way of the world these days, right? Bombast rules. So I'm asking the question, boom or bust. I think that is the question that is facing African policy makers. As the continent's young population rockets up. We're talking about 2.5 billion young people by 2050. In 20 years, we're not far. The African Development Bank says there are 13 million young Africans that enter the job market every single year, and they are fighting for 3 million jobs in the formal economy. And when you look at the decline in official development aid, you're talking 36% over the past two years. And the question we are asking is, given the scale of the drop and the pace of the drop, what will it be? I think it was was it a couple of weeks ago that President Donald Trump announced that the US was withdrawing from 66 UN agencies? There's little question. We have no time in this session. We are preparing for solutions. Number one, the African Continental Free Trade Area. Could this be the key to creating the jobs that the continent requires? Energy. We know Africa is short of power. 600 million people do not have access to reliable power. How do we solve that? And then of course, there are the entrepreneurs who are working despite and in spite of the lack of policy support from many of our governments across the continent. So I am hoping that by the end of this session, we will have some answers. And we're also going to be drawing on the forums. This is the World Economic Forum's as new evidence based. This is the state of social enterprise, unlocking inclusive Growth, jobs and development in Africa. This is a report which estimates that 2.2 million social enterprises in Africa generate about $96 billion in revenue. And two thirds that's two thirds of Africa's GDP. And 1 in 2 of those are led by women and 2 in 3 by young people. There's something that is working. So how do we work with it? Let me, at this point introduce my guests, to my left is the honorable Ahmed Muhammad. He's the minister of finance from Ethiopia. Minister, welcome. Thank you. Next to him, is the Honorable Yusuf Matama Tuga, Minister of Foreign Affairs, Nigeria Minister. Thank you, sir, for your time.
Pleasure to be here.
And last but not least is Angela Ojo. She is executive director, Ushahidi, Inc.. Welcome, Angela. Thank you. Thank you. Let me start with you, Minister. I've given the context of the number of young people who are coming to our job markets every single year. So I want to zero in and put it in, in case in the case of Ethiopia and ask, what pathways minister are you looking at to generate jobs and what levers are you looking at in the most practical way to move forward as we start 2026?
Thank you. Existing. Working?
Yes.
Thank you. It is an honor to join this distinguished panel as investing in job creation and skills for young population of Africa and Ethiopia is more critical than ever. Guided by our comprehensive homegrown economic reform program. Two we have introduced bold and historic reforms, including the liberalization of key sectors and increased private sector participation. However, we face a pressing challenge our young labor force. With around 1.8 million new entrants each year, urgently needs significant upskilling to align with the demand of our economy. Where are jobs coming from today? Three pathways already generate employment at scale. First, agrifood, value chains, horticulture and coffee. Agro processing. Livestock, oil seeds and cereals continue to absorb millions on farms, in aggregation, in transport, cold chains and basic processing. Productivity is, however, uneven, but the employment footprint is large and there is potential to expand into on and off farm jobs. Second, SME light manufacturing and industrial parks, textiles, garments, leisure and agro processing have shown that Ethiopia can create large number of entry level wage jobs, especially for young women, when production inputs are reliable. As an example, industrial parks in Ethiopia mobilized private investment and created over 90,000 jobs in 2022, with approximately 87% of these jobs held by women. Third, services linked to urbanization and connectivity, construction, logistics, retail, healthcare, hospitality and transport are among the fastest labor absorbers today. Within this ecosystem, aviation plays a catalytic role. Ethiopia's aviation industry is not only a major direct employer, it also enables entire services and production systems. What is the binding constraints to scaling inclusive jobs? It's not only a question of labor, ideas or demand, and immediate binding constraint is the high cost and unreliability of production, logistics bottlenecks and critically, energy availability across the region. Firms cannot play, cannot expand, and therefore cannot hire at scale. Despite the progress achieved so far, we continue to face human capital gaps and skills mismatches that needs to be systematically addressed. What is the most practical level you can move on 2026 to unlock it? Regarding this, the priority is is jobs first African Continental Free Trade Area production compact that focuses on the following one. Guarantee predictable energy, forex and logistics access for job dense sectors. Second, coordinating value chains regionally not firm by firm linking farmers, factories, services and markets markets across borders. Third, lowering non-wage costs of formal employment, enabling firms to scale hiring without raising fiscal burdens. Fourth, strengthening foundational systems such as digital infrastructure and ICT innovation to support emerging high potential sectors like digital services, fintech and green technologies. Fifth, addressing human capital gaps and improving health, education and skills and creating a productive workforce. A large domestic market for pharmaceuticals which are almost entirely imported, and acute health workers shortages suggest opportunities in basic pharmaceutical, manufacturing and healthcare sectors. Six on the other hand, unlocking financing and reforming the business environment is also another important area. And finally, we also need to invest in job rich sectors and future oriented skills. Thank you.
Yeah thank you Minister. Thank you. That sounds like a lot of work that you are talking about there. And I think we are all aware of the big airport that's being built near the capital. And then of course, you spoke about the African Continental Free Trade Area. I'm going to come back and want to talk a little bit more in more detail about that. Let me come to you. I was joking with him before you came in that it's not often that I say reform that's working, and I say Nigeria. I say South Africa, I say Ethiopia, the three largest centers of economic activity that we're seeing right now on the continent. It's a good story, but let's talk about how we accelerate that. Right. I'm asking you pretty much the same question as I asked the minister here, and I am asking what extra levers you are exercising to ensure that the momentum that you are beginning to build is kept and is sustainable.
Thank you very much. So what we have are focused on first and foremost under the administration is macroeconomic reform. And we have pretty much gone very far on that. The indices, show that we've stabilized our currency. Foreign exchange is available. I can come to Davos and use my Nigerian card.
So that it's working.
It's working. You know, there's no limit. We have also removed subsidies, particularly petroleum subsidy. But at the same time, we have put in place, regulatory frameworks, legal frameworks. There are laws in place. Electricity act, for instance, that allows for you. So it's uncoupled the the the the. Distribution, transmission, power generation, and created opportunities for businesses, for private sector to come in into any of the subsectors, and set up and take advantage of, that, I should say decoupling, feed in tariffs. But of course, there's a gap because you need to also sensitize private sector. They need to understand the opportunities that exist therein. And this is something that we also face in our regional economic community. So many legal and regulatory frameworks have been created, but private sector is sometimes not even aware of the opportunities, of course, trade liberalisation scheme, that you register your products and you're able to, move them freely without paying taxes within the region. So all of that is going on, where we see huge potential for job creation is, for instance, in business process outsourcing it or because, you know, it would create we're in a race against time. We are adding 3 million, young people to our job market every year, 1 million graduates, 40,000, engineers. So, then at the same time, within Nigeria, we've created the National Credit Guarantee Company because we see the advantage of and the the multiplier effect of of credit guarantees. We have also, put in place a national consumer credit, agency. So it is it allows for credit history and all of that. So it's a nation of entrepreneurs and putting all of these frameworks in place unleashes, you know, the, the potential that has always existed. But then when you go down to the, to the rural areas, to villages, you also see a lot of things that are happening, just by providing that enabling environment. So when we talk about renewables, we have, private companies partnering with, you know, foreigners coming in creating ecosystems out of, solar, power, so that, they come in with containers, they take advantage of the local material there to, to build, many markets, to bring in the, the farmers also to take advantage create, micro credit and micro, banks, so that, they, they can have access to, to fertilizer, to renewed seeds and all of that. So these things are happening, guna is something that is spreading in Nigeria at the moment. Guna is actually bitter melon, okay. And that bitter melon is being used in agrarian communities. A lot of farmers are turning to growing guna to growing the, the, the bitter melon. Because they use the seeds for oil, they use it for, for lubrication of their manufacturing the, the local equipment.
But you don't eat.
The equipment, you eat parts of it as well, but a lot of it goes to other uses. They use it also for fertilizer. So it's just versatile. There's so much use. So these are things that go unreported that are happening at that lower level, that is creating wealth, but importantly, bringing the informal sector to the formal is unleashing so much wealth, so much, so many opportunities. And it's because we can't rely on public sector to create the jobs private sector is taking advantage of.
Yeah, yeah. I take your point about the lack of information. In fact, research done by Afreximbank, the African Export-Import Bank, shows the lack of awareness about the opportunities and information on African economies. One of the biggest hindrances to companies being able to grow on the continent. Thank you, Minister, for those thoughts. Angela, let me come to you. So, so I wanted to tell you those who are in the room. So Angela has gone through this thing and read the whole thing, and she did it. Was that in one day? Yes. So this is the report that I was talking about. So, Angela, I'm going to ask you to talk to us about that report, and I'm going to ask you to tell us why some of the things that are coming out of there matter because you are on the ground. I almost called your company the United Nations of the private sector. You said you're in 160 countries. Yes, but the question I have for you is why you are not in all of the African countries. Another day. Let's get your key takeaways there.
I think first it shows that social enterprises are part of Africa's economy, and that is, you know, it's a significant a significant portion, right? You know, looking at some of the the highlights from this report, 2.1, 2.18 million social enterprises that are creating millions, tens of millions of jobs and contributing, up to 3% of Africa's GDP. Right. So it just goes to show that it's not just the traditional enterprise that is, you know, a core part of Africa's economy. I think the other thing that's quite striking is, you know, who's driving that growth? Nearly half, you know, 1 in 2 of these social enterprises are led by women, right. And a third are by young people. And these leaders are in turn creating jobs that are then going to hire women and going to hire young people. I think it also goes to show that you can combine business acumen, and social purpose to create economic value, and measurable impact that will then drive economic growth. When I think about it as someone who's running, what you would call a social enterprise on the African continent supporting a different parts of the world, there's three things that I would highlight, as, you know, things that are working, that you are starting off with are problem led and people centered innovation that we're really grounding it in what challenges we are facing within our communities and having that drive, what we're thinking, solutions would be second thing would be networks and peer ecosystems. Yes, financial capital is important, but social capital is equally as important. So having strong local hubs, ecosystems, communities of practice where people can can learn from each other is also really important. And third, technology as an enabler, not as the solution. You know, whenever it is accessible, it really is helping these enterprises to reach underserved communities at scale. It's enabling them to become more efficient. And, you know, come look through new models of, of of service delivery now challenges. The report names a number of them. You know, there's, regulatory challenges. There's things around support. But I want to hone in on one that's really critical, which is access to capital and financing. I think more than 55% of the social enterprises that were interviewed for this report noted that as a major challenge. Right. So, you know, for us, you look at, these are middle funding gap. You're either too big to get the smaller grants or what you call micro-financing, or you're too small or considered too risky for the traditional, you know, commercial financing. And that leads you to be reliant on international funding or informal funding, which just goes to highlight the gaps in the local financing ecosystems. I think there's also limited appetite, within the social enterprise, you know, limited appetite to try and understand, you know, the unique nature of these social enterprises. So, you know, we are operating in markets where traditional businesses are operating. We have the ingos. So how do you create or, you know, how do you establish and sustain market presence with limited resources in such a competitive, environment? So when I think about some of the practical levels, this is just one of them. Really look at how we can unlock patient and flexible financing for social enterprises when it's the philanthropic sector. You know, how we providing unrestricted funding that can actually go towards meeting the operational costs for these social enterprises, for governments? How are we creating a conducive environment from the policy side? Are we also deploying a financial instruments could be grand challenges or seed or seed grants for private sector. Also look at how you can give pro bono skilling right. Give us your engineers for six months to one year. That will actually help us develop these solutions.
Absolutely.
And there's more in the report. So go and read it.
The ministers are listening. And I was looking at them when you were talking about what you need from a policy perspective. The time is not with us because I am going to give each one of you one minute, one minute to contribute your thoughts to how we use the AfCFTA to create jobs at scale. I'm starting with you, Angela.
I'll name one. But there many. Make the, the free trade agreement real not just for big firms, but for small and midsize businesses as well. So, you know, simplify compliance, reduce that friction and red tape so that, you know, we are spending less time navigating bureaucracy and more time actually selling and scaling beyond our borders so that our businesses can operate in different African countries.
I love that, I love that simplify compliance. Simplify compliance. Minister.
I'll tell you how not to use it. Do not use it as a vehicle for, delivering environmental labor standards, equity, and so forth, because that's not what it was designed for. It was designed for integration, integrating African markets. So if we detain ourselves on pushing, the AfCFTA to deliver all those lofty goals. Yeah. We're not going to achieve anything. Yeah. Let that be the exclusive preserve of, the national governments. Let the countries let it be at the country level. So AFC FTA should focus on integrating markets, and it is through the regional economic communities. And, digital trade is one way of moving fast. So let's get things done because we are in a race against time. We don't have time to waste, with pedantic, nit picking, equator principle is that. Yes. By all means, let's have those standards. But, you know, let it not be too pedantic.
I think you're smiling, right? Because you're speaking to what you are talking about. Yes, Minister.
Thank you. To harness Africa's competitiveness levels in 2026 for inclusive job creation, we must adopt an integrated ecosystem strategy regionally. Trade costs for Africa's agricultural and manufacturing goods remain among the world's highest, so accelerating AfCFTA implementation paired with corridor and border performance management is essential to scale intra-African trade and job creation. Ethiopia can leverage AfCFTA to diversify beyond primary commodities into high value manufacturing and services, but success hinges on cutting very high trade costs and frictions through trade facilitation and logistics upgrade. As you said, the current big airport project we are doing is going to even support Africa in terms of trade integration, ongoing reforms, including shifting to WTO, consistent custom valuation with authorised economic operators are steps in the right direction and require sustained execution to translate into firm level market access. The other is energy. As Ethiopia expands regional power interconnections linking neighboring countries to the grid and the single most binding constraint to industrialization. Services expansion in the Horn of Africa begins to ease. Yeah, even Gerd and our bigger dams are contributing significantly to energy in our region.
Indeed.
Yeah. So also logistics is very important and reliable. Competitive price energy is a foundation for manufacturing, agro processing, logistics hubs, digital services and cross-border value chains for AfCFTA. Yeah, this matters enormously. Trade integration without energy integration does not create jobs, but with power, connectivity and logistics aligned, Ethiopia can anchor regional production networks, not just export of goods. So I think FTA f cfta should become not just a trade agreement but a jobs engine. Absolutely. In Africa, we also need to leverage our use by directing digital innovation towards solving local challenges. This includes agritech for food systems, fintech for SMEs and digital platforms for market access. Finally, we need to strengthen an ecosystem for youth entrepreneurship, providing the necessary finance as well as creating small scale border trade with simplified custom procedure, which is what we are arranging with Kenya for women living in border areas. Thank you.
Yeah, absolutely. And I'm going to pick up on the customs one because that's key. I have spent hours and hours and hours at our borders, whether it's Namanga or it's bad bridge or I can tell you it's terrible. Terrible. Thank you very much for your thoughts. I am very sorry I hurried you, but I am also very happy that we've been able to get pithy things that people can pick on and run with in their own particular areas. I'm going to open up the discussion to the floor and ask if there's anyone with a question or a comment they would like to contribute to. Please raise your hand. There should be a mic that's ready. We've got a hand here. Let's quickly move up. I've got six minutes to pack in as many questions as we can. Let's go.
Thank you. Ernest Darko from the Broadreach group. We implement, public health solutions, in particular digital and AI solutions on the African continent. My main comment is the importance of actually talking to innovators and entrepreneurs, to actually understand what the barriers are that they're facing, as opposed to conceiving them, without them specifically telling you what their challenges are. I'll just give you an example of three quick ones. In one country I have to pay 25% tax on my revenues. This is even before I've taken out my cost in another country. I'm not allowed to have data leave the country. It's not allowed to be in the cloud. Right. So we're basically not allowed to deploy this AI solution effectively in another country. I, we were providing patient SMS reminders, which was really improving patient retention. They stopped our program because they said you're not allowed to have the patient name and contact details because of data Security and Protection of Personal Information Act. So these are the kind of things, by the way, our company was hiring over a thousand people. We ended up having to let these staff go. These are jobs that are the jobs they're talking about that are disappearing because of these kind of policies, which to me are self-defeating. So really talking to us about this is practically what you go through.
Yes.
Yes.
Yes, absolutely. And you didn't name the country. So I don't know what to do with the ministers. I'm going to ask them to. I'm totally with you. I'll ask one of the ministers to respond.
No. In Ethiopia we have a structured dialogue with our business communities. Yeah, regular dialogue, even international.
To them. And they tell you what they are.
Facing. The comprehensive macroeconomic reform we are embarking on is basically to improve the macroeconomic environment so that we will have FDI to significant FDI into the country, as well as also, develop the domestic business sector as well. So definitely, we are in line in terms of listening, most of the taxation reform, customs reform, enhancing the quality of customs administration and tax administration, those areas where we are working so that we can address some of the concerns by FDI and other businesses in Ethiopia.
Thank you. Yeah. So the minister says he's listening. So hopefully it's not Ethiopia that we are talking about. Minister, very quickly.
We just, unfurled our tax reform. We've completely overhauled our taxes so that you pay less, corporate income tax, and trying as much as possible to create opportunities for entrepreneurs. We understand that because that is what we subsist on. Yeah. It's a nation of entrepreneurs, as I've said. And on the regional level, is doing a lot towards sensitizing. Like I said, the AfCFTA is building blocks are the RECs, the regional economic communities, which is why when Nigeria was chairing ECOWAS, we had the West Africa Economic Summit so that we can, explain to private sector the legal and regulatory frameworks that are already in place so that they can take advantage, of them, West Africa power pool, you know, and then of course, the trade corridors, Abidjan, Lagos trade corridor, Abidjan, Dakar that we're working on and so forth. So sometimes the there's a gap between what is what already exists and what, private sector and entrepreneurs. No.
Yeah, indeed. I've got two more time for two more questions. There's a hand here. I'm going to go to the ladies. I'm very sorry. You go quick.
Okay. Hello. My name is actually.
Take the three questions together so that we maximize.
Okay. My name is Annie from Nigeria. I work with the Presidential Initiative for Unlocking the Healthcare value chain to increase local healthcare manufacturing. And I'm also the chair of diplomacy, Migration International Corporation, Abuja Youth Parliament, for context. So I want to ask specifically to Ambassador Tuggar, what are some specific platforms that can allow us to prepare young people to participate in global value chains? I want to know if you are one willing to work with Abuja Youth Parliament to increase this, but are there any specific pathways within the system that you're currently operating in that can allow us to advance industry by investing in youth education?
Thanks very much. Let's put their.
Thank you. My name is Lorraine Sibanda from Zimbabwe. I work with Street International, which is a network of informal economy organizations in 62 countries. My question is what our governments are doing to aid the transitioning of the informal economy to formality. In view of the boom in informality globally, particularly in Africa, we cannot ignore the vast existence of informality. What are we doing to harness the positives of informality and transition, as well as complement and grow the informal economy to formality?
Indeed, indeed. And she speaks about a very sad case. Zimbabwe used to be the other way. Around 80% formal, 20% informal. Now it's now 20% informal, 80% are informal. Okay, final question is what she says. Yeah. Sorry.
Hi. This is for, Minister Mohammed. So Ethiopia has a large, skilled and financially capable diaspora that wants to contribute to, Africa's job reskilling and job creation. But some face a lot of regulatory and bureaucratic barriers. But what is Ethiopia doing to help translate that capital and expertise into real local jobs?
Thank you. I'm constrained for time. I'm going to ask the ministers to be very brief in their answers. Angela, feel free to to come in as well. Let's begin with the last question. Minister.
Thank you very much. For the last seven years, as we have been implementing our home grown economy reform agenda and, we have reached out a lot in terms of our diaspora communities. And the Prime Minister made a lot of tours globally. And most of the reform agendas which we are embarking on in the country is also benefiting diasporas. There are significant diasporas who are already investing and coming back, contributing to the skill to their knowledge, their education, as well as also their capital in terms of developing their country. So we are developing the regulatory frameworks, the macroeconomic reform. We liberalize the exchange exchange rate, exchange market, forex market. I mean, and we have opened the banking sector. So I mean, we have opened and liberalized the sector for all FDI as well as also for, for, for, for diasporas. And we have a special law allowing diaspora communities to be treated as domestic businesses, particularly those who are originating from home. So there is a lot we have done for the last seven years, and they can benefit from this macroeconomic reform and improved regulatory mechanisms and allows particularly geared toward addressing participation of diaspora communities. So most of them are participating and we will continue to encourage them.
The word is reform, continuous reform. Minister.
So with a question on healthcare, I think we should have we could have discussed this in Abuja. You and I were both in the same government and, you know, but be that as it may, in our foreign policy agenda, we've got the four D's. One of the D's is demography, specifically dealing with people. And our missions are equally, participating in that. They are actually at the core phase of that. So you can engage us, through the Ministry of Foreign Affairs, through the embassies, and also through the regional entities. Like with us, you've got the West Africa, Health Organization. I'm sure you're you know of it. So please visit me in my office. Let's discuss this, informality to formality. We are achieving that through fintech. That's why we are churning out all these unicorns. You get a bank account, you go from informal to formal. It's happening by the day and through identification as well. So there are so many different identification processes going on. Tax identification number, BVN, when you have a bank, bank verification number and so forth. And then all of that is being coalesced under the National Identity Management Commission.
Absolutely. Angela, you have the final word.
Okay. I think for me, it's just an appreciation that, despite all the challenges that social enterprises have faced, be it on the regulatory side or access to financing, that they've been able to do a lot. Right. And now there's a report that actually has hard data to prove that. So mine is a call really to the governments within the African continent to really look through and think about how you can work with the private sector, work with philanthropy to really help, help these social innovators scale their impact. If this is what we're able to do in constrained environments, imagine what we can do in supportive ones.
Absolutely. Thank you very much. And my final take, and just two points that I would like to make. Really, what I take away is that this is a positive story that is coming out of the continent for the first time. I think many times we come, we talk and we talk about conflict, we talk about corruption, we talk about these challenges. Now we're talking about reform that is taking place and implementing real change and accelerating that real change through the implementation of the AfCFTA. So I'd like to ask you to help me to thank our panelists, please. And thank you as well for your time and for your participation. Thank you very much. And all of you who are listening online. Thank you for your time. Goodbye for now. Thank you.
Thank you.