As global aid flows decline, African governments, entrepreneurs, and civil society are no longer waiting to mourn the loss. Instead, they are actively rewiring the development model, pivoting away from decades of donor dependence towards a more self-reliant and resilient framework powered by the social economy.

A New Vision Under the African Union

The African Union has laid the groundwork for this transition through its continent-wide “social and solidarity economy” strategy, set to span the next decade. This initiative is not just a policy statement, but a call to action for governments to scale businesses and organisations that are rooted in local communities, serve public needs, and reinvest their earnings back into the societies they emerge from. These ventures are not theoretical models of reform they are already delivering tangible outcomes across the continent.

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From Community Roots to High-Tech Innovation

One example that illustrates the potential of the African social economy is BroadReach, a South African social enterprise that leverages artificial intelligence to improve healthcare delivery. In the aftermath of the Trump administration’s abrupt withdrawal of US aid that had supported HIV treatment programmes, BroadReach stepped in to fill the gap. Their AI-driven systems are now helping streamline care for millions of people living with HIV and tuberculosis a testament to how local innovation can overcome the void left by international donors.

Government Action and the Role of Policy

Across Africa, governments are beginning to institutionalise support for the social economy. Kenya, for instance, has established a dedicated agency to promote this sector, providing critical infrastructure and policy backing. Meanwhile, South Africa is set to use its upcoming G20 presidency in 2025 to spotlight solidarity, equality, and sustainability themes that lie at the core of the social and solidarity economy.

This momentum reflects a deeper realisation that traditional capital flows are no longer sufficient or fit for purpose. There is a growing consensus that Africa needs a new kind of financial ecosystem one that is patient, flexible, and aligned with long-term development goals rather than short-term profit.

Financing What Works: Impact, Not Just Returns

The tools for this transition already exist. Impact investing, blended finance, and outcome-based funding models have shown success in various global contexts, but remain underutilised in Africa due to persistent barriers such as rigid funding mandates and institutional aversion to perceived risk. To unlock their full potential, development finance institutions and private investors must be willing to adopt a broader lens that values purpose as much as return.

This shift will require courageous leadership, innovative policy, and international partners who are ready to support African solutions. It will also require moving beyond the outdated narrative that casts Africa as a passive recipient of aid. The continent’s social economy is dynamic, diverse, and capable of delivering both economic and social transformation.

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The Future Lies in the Social Economy

Africa’s social economy is not a peripheral experiment or a temporary solution. It represents a fundamental reimagining of how development can be driven from within. This is not about replacing aid for the sake of independence. It is about recognising what works, investing in what is already delivering, and supporting the actors who are solving Africa’s most pressing challenges in real time.

The real question is not whether this model can succeed. It is whether the world is ready to back a future where development is led by Africans, for Africans and powered by enterprises that put people and planet at the center of progress.

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