Sunday, August 12 is International Youth Day, an annual observance supported by the United Nations (UN) calling attention to youth issues worldwide. In both developing and developed countries, young people face pressing global challenges, such as high levels of unemployment and subpar working conditions. They are seemingly left out while their leaders make decisions on their future.
The UN provides several statistics that emphasize the need to ensure that the world’s youth is properly educated. Currently, 11 percent of the world’s youth, between the ages of 15-24, are non-literate. In developing countries, data from 2005-2008 indicates that the percentage of non-literate youth is 13 percent, with Sub-Saharan Africa’s percentage standing at 29 percent.
While youth non-literacy rates are projected to fall to 8 percent for the world and 9 percent in developing countries as a whole by 2015, the UN says that these rates are projected to decline only slightly in sub-Saharan Africa, lingering at 24 percent.
The theme of International Youth Day 2012 is “Building a Better World: Partnering with Youth.” In working to mobilize private capital to address critical development challenges around the world, OPIC often supports projects that directly or indirectly promote access to education for youth around the world.
In Ghana, there is significant demand for high-quality education from an internationally-certified institution that will prepare students for college. As a result of a direct OPIC loan of $1.75 million to leverage a $2.5 million expansion of the International Community School in Kumas, advanced secondary school facilities were constructed, in addition to a student center and an administrative center. These developments have allowed for the school to increase enrollment from 460 to 1,010 students. Several recent graduates have gone on to attend college in the United States.
In the West Bank, where investing in education is also a challenge and many families lack the resources to purchase computers – a standard part of education in the 21st Century –OPIC provided a $10 million loan to fund microfinance loans for Netketabi, a program which enables families to purchase “netbook” computers stocked with Arab-language books and other educational materials. By mid-2012, approximately 7,500 computers have been purchased through the program, which is expected to distribute between 100,000 and 280,000 computers to children over the next ten years.
Another trend in microfinance is moving from access to finance to “access to life” issues, which could see cell phones double down as conduits for services such as health insurance, renewable energy programs, education finance and the like. With 85 percent of young people living in developing countries, and considering the high levels of unemployment in these regions, governments are increasingly looking for proactive approaches to help youth realize their full economic potential. Youth represent the next wave of new clients for financial services providers, with the population expected to grow by one billion over the next decade, particularly in sub-Saharan Africa.
Entrepreneurial energy and ubiquitous cell phone use makes Kenya an ideal place for innovation in youth development. Mobile phone subscribers below the age of 30 are predicted to increase in 2012 throughout the world; in sub-Saharan Africa, the number is projected to rise to 108 million. Youth who are often technologically savvy and most likely own or have access to a cell phone may be more comfortable using this medium to access their savings account.
The Kifaru Youth Group, a microfinance loan group based in Nairobi suburb of Kawangware is supported with microloans from Equity Bank’s Kawangware branch, which opened in 2007 and has since seen its customer base grow from 5000 members to 80,000. OPIC supports Equity through the Helios Sub-Saharan Africa Fund I, which is providing $50.7 million to the bank.