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The Traditional Development Finance Model has not Worked for Africa Over the Past Six Decades

Even though the world economy has grown in the past few decades, most African nations lag economically and grapple with abject poverty. Their commodities are highly susceptible to market fluctuations and natural disasters, and their societies are prone to instability, making it difficult to attract foreign investment. That is why most African nations turn to development aid to survive, which is not a viable model to achieve sustainable economic development. Since 1990, African countries received over $1.3 trillion in development assistance; however, the continent’s financial, societal, and political fabric remains fragile. In recent years, Africa has proved that it has the capability to champion local solutions. Take the phenomenal success of M-PESA, a mobile-based payment service targeting the un-banked that was launched in Kenya in 2007. The service has been so successful that it expanded to Tanzania, Mozambique, Democratic Republic of the Congo, Lesotho, Ghana, Egypt, Afghanistan, and South Africa.