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Impact Story

IDS research shapes enterprise development action in Africa

Published on 1 September 2020

Image of Jodie Thorpe

Jodie Thorpe

Research Fellow

This past year has seen IDS expand our wide portfolio of long-term research on the private sector through dedicated work for the German development agency GIZ. We provided evidence to assess and shape its programme on enterprise development in East Africa – and in the process, stimulated debate on wider lessons for job creation across the continent.

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Thousands of people in the target countries have benefited from new employment or increased incomes through the GIZ-run Employment and Skills for Eastern Africa (E4D/SOGA) programme funded by DFID as well as other public and private partners.

Using foreign investment, E4D/SOGA promotes employment and addresses skills gaps in Kenya, Mozambique, Tanzania and Uganda. The programme designs and funds interventions with the private sector to ensure these are demand-driven. It pursues opportunities in natural resource-based industries and adjacent sectors such as construction, maintenance, logistics, manufacturing and food supply.

Our involvement with E4D/SOGA spanned all of 2019. The IDS team – Research Fellows Jodie Thorpe and Seife Ayele, Research Officer Peter O’Flynn and Honorary Associate Lizbeth Navas-Aleman – focused on supporting GIZ to refine the enterprise development aspects of E4D/SOGA. They studied how to support small and medium-sized enterprises (SMEs), micro-sized enterprises and entrepreneurs with the aim of creating jobs.

In reviewing phase one of E4D/SOGA, the team sought to understand the types of enterprises most likely to create the greatest economic opportunities and how programme interventions could best support those enterprises.

Well-received findings

The team worked closely with GIZ’s E4D/SOGA staff to build the research plan. They then fed concrete findings into the emerging programme design for phase two, helping to shape future directions.

This approach ensured considerable buy-in from within the E4D/ SOGA community. Our research is now influencing the design of the next phase of the programme, which runs until 2023.

According to Svenja Brachmann, GIZ portfolio adviser on the programme, ‘E4D/SOGA colleagues were really impressed by how well IDS analysed and understood our programme, and by how constructive and detailed the recommendations were.

Given the strength and relevance of the team’s work, IDS was invited to present the research to the annual meeting of GIZ economic development advisers in Africa in September. Jodie Thorpe presented the findings to the closed meeting, which was held in Kigali, Rwanda, with GIZ advisers working on an African approach to growth and employment, including the private sector.

The IDS presentation and research were very well received, stimulating discussion of how lessons on job creation through foreign investment might be applied to other sectors, such as agriculture, across the African continent.

Reaching poorer populations

Since E4D/SOGA began in 2015, more than 70 international and African partner companies have got involved in interventions in four different countries. More than two-thirds of the interventions have reached the poorer sections of the populations involved.

E4D/SOGA reports that 23,300 people have gained employment so far, of whom 30 per cent were women and 49 per cent were young people. Some 23,500 people, of whom 34 per cent were women and 56 per cent were young people, have seen their incomes rise by at least 10 per cent. Health and safety in the workplace measures have helped to improve working conditions for 11,200 people (44 per cent of whom are women).

GIZ programme data show that training measures have supported 1,030 micro, small and medium enterprises offering goods and services across sectors as well as 29,700 agricultural micro-enterprises.