Working PaperRegion & Country Studies

Green Industrialisation and Entrepreneurship in Africa

Milan Brahmbhatt, Catlyne Haddaoui, John Page

Changing global trends are creating new opportunities for economic transformation and green industrialization in Africa. Policies that encourage economic transformation and ‘green growth’, combined with entrepreneurship, could enable Africa to achieve a clean, resource-efficient modern economy.


Milan Brahmbhatt New Climate Economy

Catlyne Haddaoui Overseas Development Institute

John Page The Brookings Institution


October 2017

Policymakers across Africa have widely embraced economic transformation as a key to help accelerate and sustain inclusive growth. Economic transformation refers to two linked development processes. One is structural change: the shift of workers and other resources from low-productivity sectors, such as subsistence agriculture, to high-productivity sectors, such as industry and modern services. The other is faster productivity growth within various sectors. Sustained robust economic growth is essential to achieve rapid job growth and poverty reduction in Africa.

African policymakers also increasingly stress the need and the growing opportunities for green growth – growth that protects Africa’s natural environment in ways that increase the welfare of present and future generations, and which creates new opportunities for economic transformation and development. Ensuring that the natural environment is able to continue to provide the services on which human welfare depends is essential to ensuring the sustainability of economic transformation and growth. Africa is experiencing the ill effects of environmental degradation on several fronts. But such outcomes are not inevitable. Economic transformation can and should deliver green growth.

Economic transformation and green growth both depend on doing new things or doing things differently: making risky investments in new, unfamiliar sectors or products or adopting new, unfamiliar methods, processes, technologies, or inputs. Therefore they depend crucially on the activity of entrepreneurs, who drive change through their innovation and risk-taking.

This paper discusses the opportunities – and challenges – for African policymakers and businesses on these three related issues: economic transformation, green growth, and entrepreneurship. Better policies and institutions, changing world markets and global technological progress have the potential to foster both economic transformation and green growth in Africa, or to better manage trade-offs between them, as well as to encourage more vigorous entrepreneurship, a key for economic transformation and green growth.

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