Africa-Focused Giving By U.S. Foundations Grew At Twice The Rate Of Overall International Giving

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Written by Dana Sanchez

Business investors aren’t the only ones spotting Africa’s potential. Name-brand foundations are also investing in Africa, making grants on a historic level dedicated to solving global health and development challenges, Sue-Lynn Moses reports in Inside Philanthropy.

A growing number of impact investments have also been flowing into Africa from social investors like superstar Akon, interested in everything from solar power and clean water to more affordable tampons.

U.S.-based rap star Akon is one of the most famous impact investors in Africa — and one of the most prominent voices against giving charity to the continent.

Akon’s solar lighting project, Akon Lighting Africa aims to tackle the problem of low access to electricity on the continent using a different approach to the usual methods of NGOs in Africa, The Guardian reported in October, 2015.

Akon believes what rural African communities need is not overseas charity but affordable renewable energy delivered by trained African professionals managing for-profit businesses that generate jobs and build self-sustaining economies.

“I don’t think that charities in Africa really work,” Akon said, according to a Guardian report. “I think it just holds the people down longer than it should. I think the only way to build Africa is to build for-profit businesses that create opportunities and jobs for the people locally. That’s why with Akon Lighting Africa we decided to take a for-profit approach. Ultimately, it’s providing empowerment to local people so they can start developing their own economies.”

Philanthropy isn’t going away

Africa-focused giving by U.S. foundations grew at more than twice the rate of overall international giving between 2002 and 2012, according to a Foundation Center study. Africa accounted for 25 percent of international grant dollars in 2012, up from 14 percent in 2002. Africa-focused foundation grant dollars jumped more than 400 percent, from $288.8 million to nearly $1.5 billion.

The Gates Foundation seems to get most of the attention, perhaps rightfully so. It’s the biggest player in the field, but not the only one.

Gates made headlines with a recent commitment of $5 billion over the next five years to help combat diseases and help economic progress. An estimated two thirds of the $5 billion will be  dedicated to health.

The foundation is also a big player in Africa’s agricultural sector, awarding $260 million in grants in 2015 to benefit Africa’s farmers.

“We continue to spend the majority of our money on health-related issues,” Bill Gates said when he made the announcement. “… tuberculosis, HIV, diarrhea, pneumonia – all the things that affect kids under the age of 5.”

Since 2008, Gates has awarded nearly 1,400 sub-Saharan Africa grants worth billions of dollars. The foundation works unobtrusively in over 45 African countries, Inside Philanthropy reported. It has offices in Ethiopia, Nigeria, and South Africa — the three countries where it dedicates most of its resources.

Other foundations giving in Africa

The No. 2 U.S. funder in Africa after Gates in 2012, the Ford Foundation made $60 million in grants. It has offices in Johannesburg, Lagos, and Nairobi, and its work is continuing after the foundation’s recent reorganization.

The Open Society Foundations has a big presence in Africa, with four main offices around the continent and eight satellite offices. It gave $24 million for Africa in 2012.

The giant Hewlett Foundation also funds heavily in Africa, as does the Conrad N. Hilton Foundation. Packard, MacArthur, Carnegie, and Omidyar have been African funders in the past decade. The Michael and Susan Dell Foundation has long been working in South Africa. The Helmsley Charitable Trust is a relative newcomers to Africa.

Rockefeller Foundation

The Rockefeller Foundation focuses its African giving on health, agriculture, employment, and gender equity. IRockefeller doesn’t necessarily seek to prevent, treat, or eradicate disease like malaria or polio, but tries instead to “incentivize individuals, communities, and governments to address the breadth of variables that contribute to healthy societies,” Inside Philanthropy reported.

Rockefeller also places emphasis on helping African youth find work, mainly through impact sourcing. The foundation has invested millions of dollars into its Digital Jobs Africa program, focusing on information communication technology (ICT).

Howard Buffett Foundation

The Howard Buffett Foundation was the fifth largest U.S. funder on the continent in 2012, giving of $24 million. As the value of Berkshire Hathaway shares have risen, there’s been an even bigger flow of funding in recent years. The foundation’s projects include a $500 million commitment to improve agriculture in Rwanda and build hydro-electric plants in the Great Lakes region. Howard Buffett sees electricity and the economic growth it brings as key to stabilizing the region.

Coca-Cola

The Coca-Cola Foundation gives extensively in Africa, channeling some funding to diseases such as HIV/AIDS, but more interested in projects related to water, women’s empowerment, education, and youth development. In 2015, it awarded grants worth over $26 million to these efforts.

MasterCard Foundation

The MasterCard Foundation has increasing funding in recent years, introducing its $50 million Fund for Rural Prosperity, which hopes will help 1 million of Africa’s rural poor escape poverty by improving their access to financial products and services.

The foundation’s Scholars Program help youth to access quality secondary and university educations. The $500 million education initiative launched in 2012 focuses funding on Africa, but does operate in other developing countries.

Other funders in Africa include the Citi and MetLife foundations, which are dedicated to financial inclusion. Many smaller foundations and major donors support work on the continent.

The number of Africa’s high-net worth individuals is growing, according to a report by New World Health. So is the number of poor. The number of people living on less than a $1.25 a day increased from 411 million in 2010 to nearly 416 million in 2011, World Bank data shows.

Despite Africa’s widespread growth over the past 10 to 15 years, many regions are stuck in conflict, burdened by disease, poverty, corruption, and human rights violations.

Still, the continent is rising, and philanthropy is playing a key role, Inside Philanthropy reported.