Dear readers,

Ubuntu is a widespread philosophy in many African cultures. Its central premise is “I am because we are”. It is a basic moral attitude that views people as part of a larger community. At THE NEW INSTITUTE, the Africapitalism program draws on this ideology to develop a new form of collective entrepreneurship in Nigeria. This probably sounds more theoretical than it is: Kenneth Amaeshi, the program's chair, is a social scientist and the chief economic advisor to the Imo state in Nigeria where this form of collective entrepreneurship is currently being tested. It’s called OKOBI and it’s amazingly successful.

I'm a business journalist and currently a media fellow at THE NEW INSTITUTE, where this year's theme is “Re-thinking Capitalism”. In a series of short newsletters, I report on some of the ideas and projects as concretely and comprehensively as possible. I hope you enjoy reading the following!

Felix Rohrbeck

P.S. We have a German version of the text available for you here.

Capitalism that Works for Africa

Why shouldn't a village be able to start a business? As chair of the Africapitalism program at THE NEW INSTITUTE, Kenneth Amaeshi aims to nudge more people into collective entrepreneurship based on African traditions. This concept is already working surprisingly well in his home country of Nigeria.

1. What Is the Problem?

When we debate the future of capitalism, we often do so from a Western perspective. The conversation tends to focus on individual entrepreneurs, sustainable consumption, the growing influence of tech companies, and what an economy geared towards something other than growth could look like. “These are all important debates,” says Kenneth Amaeshi, chair of the Africapitalism program at THE NEW INSTITUTE. “In large parts of Africa, however, the most pressing problems people face are completely different.”

Amaeshi grew up in Imo State in southeastern Nigeria. More than five million people live there, most of whom are part of the Igbo ethnic group. According to the most recent reliable figures from 2020, the state's unemployment rate is 57%.

“We have millions of young people who can't find a job, even if they are well educated,” says Amaeshi. 

In his view, a key reason for this is that, even after the colonial era ended, the focus has continued to be on Western forms of capitalism that prioritize short-term profits instead of developing local businesses and entrepreneurship, thus failing to build on Africa's communal traditions.

Amaeshi is a professor at the European University Institute in Florence where he conducts research on sustainable development and financing in the Global South. Since 2022, he has also served as the Imo government's chief economic advisor. This gives him direct influence over what is tested and implemented there.

2. What Is the Approach?

Based on the idea that African countries need appropriate versions of capitalism given their specific traditions and challenges, Tony Elumelu, a Nigerian businessman, developed the concept of “Africapitalism”. At its core, Africapitalism is a positive vision of capitalism that assumes African companies and entrepreneurs can play a central role in creating prosperity and combating high unemployment. For Amaeshi, Africapitalism also aligns with the Ubuntu philosophy that is prevalent in Africa. This idea cannot be easily translated with just one phrase. Rather, Ubuntu is a basic moral attitude that sees people as part of a larger community. “I am because we are” is the central premise of the philosophy. The focus is not on the individual and their needs, but rather on cooperation, shared prosperity, and harmonious existence.

“Africapitalism,” says Amaeshi, “has mainly been a theoretical concept that has sparked new debates.” Naturally, questions and doubts remain as to whether and how it can be applied in the real world.

This makes testing the concept in practice all the more important – and is precisely what is happening in Imo State. In 2022, the government of Imo State, under the leadership of Senator Hope Uzodimma, launched the “One Kindred One Business Initiative” (OKOBI). Family networks known among the Igbo as “Umunna” have always played a significant role in resolving conflicts and problems. These communal structures are now being used to found new companies. The focus is on the collective, whether it's a family, village, or religious community, not the individual. The state supports such groups by providing start-up capital, training, and practical assistance, such as business registration. There is only one condition: The business must be owned by more than one person and address a community problem that can be solved through entrepreneurship.

More than 400 companies have been established under the OKOBI umbrella. One such company is Feedwell Food Processing, which processes cassava to increase the value of one of the region’s most abundant crops. Another is Akuyoma Amaimo. Doctors, lawyers, and engineers from the small town of Amaimo have come together to create a small private equity firm that provides affordable loans to local businesses. “It's a kind of entrepreneurial, grassroots movement that has quickly gained momentum,” says Amaeshi.

3. What Is the Project at the Institute?

“First, we are trying to better understand what is actually happening,” says Amaeshi. Implementing the Africapitalism concept in Imo State was a significant step. Now, however, it is equally important to learn from this experience and develop a theoretical framework. “The questions that concern us include: How can the OKOBI approach have an even greater impact? And how can it be scaled up, perhaps even beyond Imo State and Nigeria?”

At THE NEW INSTITUTE, Amaeshi works with a team of eleven scholars and practitioners. These include Naomi Nwokolo, the Director of the Global Compact in Nigeria — the largest UN initiative for corporate sustainability — and Camille Meyer, an associate professor of social innovation and entrepreneurship in South Africa. Maria Etemore Glover is CEO of the Impact Investors Foundation in Nigeria and mobilizes private capital for social investments.

Photo by Luzia Cruz

One concrete result of the Institute's work is a comprehensive handbook that will help others establish community-oriented enterprises in Africa, which Amaeshi's team developed and wrote. The first part of the handbook provides a theoretical framework for the OKOBI approach, enabling companies, politicians, and other decision-makers to familiarize themselves with the concept and its underlying principles. The second part is a practical guide. How do I set up such a company? How do I identify the problem? What partners are necessary? What is important for success? These questions and more are answered in five clear and comprehensive steps based on experiences the program has studied in Imo State. “The goal is to make the approach as replicable as possible,” says Amaeshi. "The handbook now provides a very practical tool for this.”

Amaeshi and his team view companies as a significant means of scaling up the approach. As part of their corporate social responsibility (CSR), many companies are already involved in African countries, supporting schools and building roads and wells. “That is well-intentioned. However, the impact is often limited because it does not solve the structural problems of poverty and unemployment,” says Amaeshi. It also creates new dependencies. It is better to empower people to help themselves. “If companies recognize this, they can effectively help people help themselves as part of the OKOBI approach,” says Amaeshi.

To raise awareness of the concept, Amaeshi and his team have published several articles about what they’ve worked on at THE NEW INSTITUTE, including in the Nigerian newspaper Premium Times. This week, from June 4 to 6, the program is hosting an Africapitalism conference at the Institute, which will feature leading representatives from businesses, NGOs, and international institutions. The newly developed handbook will be presented at the conference. As Amaeshi explains, “The Institute is a fantastic platform for us to reflect on and implement the OKOBI approach with partners beyond Nigeria.”

4. So, What Does this Mean for Capitalism?

According to Amaeshi, different approaches are needed to adapt and tame capitalism because it differs from country to country. He defines Africapitalism as a form of capitalism that can address issues in African countries while aligning with community traditions and values. At the same time, approaches such as OKOBI could inspire debates about capitalism beyond Africa. “Almost everywhere, most people are workers who sell their labor to companies," says Amaeshi. OKOBI, on the other hand, turns people into co-owners. "It's a new form of collective entrepreneurship.”

The Africapitalism program at THE NEW INSTITUTE ends in June. However, Kenneth Amaeshi would like to continue working on the project. Organizations, academics, and practitioners who are interested in working with Amaeshi are welcome to contact him via email.