by Jonathan Ledgard
illustration by Jimi Mackay

Extreme African poverty demands extreme solutions. Could socially-conscious capitalism directed to the 4 billion people who live on less than $2 a day be the answer?

—Nairobi, Kenya One way of thinking about Africa right now is to picture a stunt plane in a 1930s air show. The plane corkscrews through the cirrus, then seems to hang there in the heights. The propeller gives out. The breath catches. It’s not clear whether the engine will take, or if the plane will fall into a tailspin. By which I mean: there’s been a lot of progress in Africa in recent years—a kind of democracy has taken hold, investment is pouring in—but no one, and I mean no one, knows if the continent is going to fall into a tailspin.

It is an exciting time. For the first time in its history, money is being made—not just in Africa’s mines, but in its financial markets. 2007 is a watershed year in the Kenyan capital of Nairobi. The value of agricultural goods Nairobi bought from the rest of the country will exceed the value of Kenya’s agricultural exports to the rest of the world. And the globalized world is coming to Africa. In the last decade, mobile phone companies have invested $25 billion in building highly-profitable businesses across Africa, and they’re expected to spend even more in the coming years. In a number of countries, the market penetration rate for mobile phones is above 30 percent—about the same as rural America.

This matters. Ever since the Portuguese started cutting deals in the kingdom of Kongo in the late 15th century, middlemen have exploited Africa’s lack of capital and transport infrastructure. Their greed has underpinned the politics of patronage. Journeys in much of Africa are still slow and expensive. It is sometimes quicker, and nearly always cheaper, to ship a ton of grain from Chicago to an African port, than to transport the grain from the port only a few hundred miles away.

It’s these kind of inefficiencies that make the mobile phone a revolutionary tool, a 21st-century technology that is creating network effects across the entire breadth of Africa, from its cities to the bush, down to the so-called Bottom of the Pyramid (BOP)—the 4 billion world citizens who subsist on less than $2 a day, as described in C.K. Prahalad’s groundbreaking The Fortune at the Bottom of the Pyramid. At last, the middleman’s margins are being forced down. A cattle herder, to give one example, can now call around for the best market price before choosing which slaughterhouse to walk his cattle to. The intense localization of mobiles, not just with local languages, but with schemes to move money and sell goods, pushes him deeper into the body politic of Africa—down to the village. At election time, text messages are used to mobilize voters—the kind of Bottom of the Pyramid souls nobody used to care much about.

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