The Consequences of Unsustainable Business Development in Africa

Diploma Thesis, 2022

45 Pages, Grade: 4.5


Table of Contents












My special thanks goes to the European Union and the University of Humanities and Economics Lodz, and the entire staff in the university, especially the International Department, for giving me the chance and opportunity to acquire the knowledge and obtain a degree.

“No thinker thinks alone”, hence Gabriel Marcel in his Philosophy of Communion, affirms that man is intersubjective. I therefore express my profound gratitude to my supervisor Dr. Anisa Wykin for carefully reading through the research thesis and making corrections throughout this thesis work. Without her guidance and commitment, this research could not have been a success.

My special thanks and gratitude goes to all my instructors, lecturers for their time and care in instilling the necessary knowledge and skills needed to complete this programme. I remain ever grateful. Since no thinker thinks alone, I wish to use this opportunity to thank all the authors whose thoughts and ideas I borrowed to write this thesis and to all men of good will, I say thank you all.

James O. Mbakpuo

List of Figures and Tables

Fig 1: Relationships among Social, Environmental and Economic Sustainability

Table 1: Sustainable Development Goals (SDGS) and Industry Responsibility

Table 2: GDP (Nominal) by Continent Current Prices

Table 3: GDP (PPP) by Continent Current Prices

Table 4: Total Population of Africa from 2000 to 2021 (in millions)


Despite the fact that Africa is relatively rich in natural resources, development strategies pursued in the continent have not always been in harmony with the objective of ensuring decent living conditions for the population and maintaining a high level of environmental quality. Over the past five decades of political independence, most African countries have witnessed serious socio-economic and environmental crises (Kaniaru, 1998). For example, rapid population growth and man-made and natural disasters have seriously bruised the quality of Africa's business environment and the life of its population. The environmental business crisis facing Africa is a real threat to the very existence of the continent: Corruption, poor infrastructural development, low or poor government speeding, Low quality standards of goods and services, high cost of doing business due to lack of constant electric power supply, famine, starvation, floods, epidemic diseases, deforestation, desertification, and unmanageable mountains of waste are common environmental problems in most African countries. About two-thirds of Sub­Saharan Africa's (SSA) agricultural lands are already seriously degraded. In the social realm, there is a big gap between economic and social well-being.

There is therefore an urgent need to critically re-examine the development strategies that have been pursued in Africa and to adopt approaches that have a real potential to put Africa on the road to sustainable development (SD). This research reviews the challenges facing Africa in its determination to achieve SD in the new millennium and in the age of sustainable development.

The raise of sustainable development research in recent years since the official lunching in 2015 by the United Nations of the SDGs agenda 2030 there has been an ever-growing academic research and concern on sustainability and sustainable business in the cooperate world and how to integrate sustainability into business strategy, the concept of people, planet & profit and how to use sustainability as a catalyst for innovation and new market opportunities. Little has been achieved by the united nation on sustainable development goals since its inception in 2015. The United Nation's SDG 17 goals agenda 2030 may seems far from its realization for most African countries with the pace of development and execution of the agenda. “Mankind at the turning Point” The second Report to the club of Rome not only show us where, when, how and why something will take place on our planet but also how we can prevent the negative catastrophic damage that awaits humanity if nothing serious is done on Sustainable development goals as envisioned by the united nation in 2015. Prof. Mihajlo Mesarovic and Eduard Pestel in their second report to the club of Rome, published 1975, tagged “Mankind at the turning point”. Quote:

“The way to make doomsday prophesies self-fulfilling is to ignore the signs of dangers that truly lies ahead and passively rely or depend on fate, for such passive causes in life are not only detrimental but catastrophic”.1

This is the case with most African countries on sustainable development goals (SDGs). Therefore, critical questions such as what are some of the potential sustainable business challenges that most African countries are facing? What are the risks and benefits? Taking a comprehensive look, the unsuitable business practices in Africa shows a total lack of connectivity in social, economic and environmental policies.

Lack of triple helix action and interactions that connects the university, the private sector and the government to foster economic and social development is a potential hindrance in the development of sustainable knowledge economy and knowledge society for most African countries. Poor and strong mismanagement, poor maintenance culture, poor organizational culture, the rapid increase in unsustainable population growth, no practically functioning free economic zones or logistics hubs, bad roads or poorly constructed roads with high cost of energy supply to run businesses, coupled with extreme poverty, corruption, environmental hazard and slow economic growth and rural development and the impact of extractive industries (The tragedy of the commons) over-consumption and under-investment are some of the consequences of unsustainable development in Africa. Sustainability is becoming more important for all nations, all companies across all industries. 62% of executives consider a sustainable business strategy necessary to be competitive today and another 22% think it will be in the future.

Therefore, to set the background for an objective discussion on sustainable business development process in Africa, a number of principal business and environmental initiatives, conventions and programs adopted by the continent are first briefly reviewed.

Finally, directions for future research aimed at transforming unsustainably dominant business practices and development in Africa are provided.



A sustainable business is any organization that engages in green or environmentally friendly practices to ensure that all processes, products and production activities satisfactorily address the concerns of present on the environment while remaining profitable. In other words, it is a business that “meets the needs of the present [world] without compromising the ability of future generations to meet their own needs”2. It is the process of evaluating how product design will take advantage of the current environmental situation and the performance of a company's products with renewable resources (Rennie, 2008). The Brundtland Report emphasizes that sustainability is one-way and profit tripartite (United Nations General Assembly, 1987).

Sustainability businesses with supply chains strive to balance the three through the triple bottom line concept of using sustainability and sustainable delivery to impact the environment, business growth and society (Galvao, 2008). Organizations that give back to the community, whether through staff volunteering their time or through charitable donations, are generally considered socially sustainable. Organizations can also encourage education in their communities by training their staff and offering internships to younger members of the community. Practices like these increase educational attainment and quality of life in the community. For a business to be truly sustainable, it must maintain not only the necessary environmental resources but also social resources. Sustainable development is complex, multidimensional and dynamic (Oladeji, 2014).

Sustainable development refers to the use of resources to improve the economic performance of all sectors of the economy without compromising the access rights of future generations (Oladeji, 2014). This implies that intergenerational equity must be applied in all economic considerations for sustainable growth. Sustainable development is at the heart of global economic policy. Therefore, the reason why the United Nations has developed 17 goals labeled the Sustainable Development Goals (Osborn et al., 2015) is not too far-fetched. According to Organization for Economic Cooperation and Development (OECD, 2001) sustainable development is the development path along which the maximization of wellbeing of human wellbeing does not compromise perpetual use by future generations. Therefore, Sustainable Development is a paradigm shift from the economic growth hinged on depletion of resources and environmental degradation.

Unsustainable development compromises the ability of future generations to meet their needs. Phenomena including global warming, destruction of the ozone shield, acidification of land and water, desertification and soil loss, deforestation and forest decline, diminishing productivity of land and waters, and extinction of species and populations, demonstrate that human demand is exceeding environmental support capacities. Population growth increases poverty and deprived people are forced to undermine the productivity of the land on which they live. At this rate, humans, or other species, find it difficult to adapt to change (The Encyclopedia of World Problems & Human Potential Development, 2021).


There have been several studies on sustainable development. Edward (1987) used Venn diagrams to show that sustainable development has many versions such as economic, environmental and social sustainability. However, Pearce and Markandya (1989) have criticized the Venn diagram approach for its inability to operate on separate indicators of economic, environmental and social sustainability. They note that Venn's approach is inconsistent with a Bruntland Commission report that emphasized the link between economic development, environmental degradation and population pressures rather than the three goals. Since then, economists have focused on treating the economy and the environment as a single, interconnected system with a unified assessment method (Hamilton, 1999; Dasgupta 2007).

Intergenerational equity can be incorporated into this approach, as has become common in economic valuation of climate change economics (Heal, 2009). Ruling out discrimination against future generations and allowing for the possibility of renewable alternatives to petrochemicals and other nonrenewable resources, efficient policies are compatible with increasing human welfare. Arrow et al (2004) and other economists (Asheim, 1999; Pezzy,1989) have advocated a form of the weak criterion for sustainable development, the requirement than the wealth of a society, including human capital, knowledge capital and natural capital (as well as produced capital) not decline over time. Others, like Barbier (2007) continue to contend that strong sustainability (non-depletion) of essential forms of natural capital may be appropriate. For many environmentalists, the idea of sustainable development is an oxymoron as development seems to entail environmental degradation.


While evolution may seem inconsequential to some, it can still help predict future trends and errors and, therefore, provide a useful guide to the present and future (Elkington and Rowlands, 1999). According to Pigou (1920), SD is historically as a concept derived from economics as a discipline. Human resources would be able to continuously support the survival of the growing population that became prominent with Malthusian population theory in the early 1800s (Dixon and Fallon, 1989; Coomer, 1979). From 1789 on, Malthus recognized that population tends to increase at an additive exponential rate, while subsistence can only increase exponentially, and moreover, population growth is likely to exceed capacity. responsiveness of natural resources to the needs of a growing population (Rostow and Rostow, 1978). Therefore, if measures are not taken to control the rapid population growth, depletion or depletion of natural resources will occur, leading to human misery (Eblen and Eblen, 1994). However, the importance of this postulate tends to be overlooked in the belief that technology can be developed to negate such a fact.

Over time, growing global concern about the non-renewable nature of some natural resources threatens long-term production and economic growth due to environmental degradation and pollution (Paxton, 1993). The emergence of Malthus' postulate and raises the question of whether the suggested development path is sustainable (Kates et al., 2001). Likewise, to test whether the global economic development model was "sustainable", Meadows studied Limits to Growth in 1972, using data on population growth, production, and production industry and pollution (Basiago, 1999). Meadows concluded that "because the world is physically finite and the exponential growth of these three important variables will eventually reach a limit".3. However, some scholars, researchers and development practitioners (Dernbach, 2003; Paxton, 1993) argue that the concept of sustainable development was internationally recognized in 1972 at the United Nations Conference on Human environment organized in Stockholm. According to Daly (1992) and Basiago (1996), although the term has not been explicitly mentioned, the international community has accepted the current basic concept of sustainable development that development and the environment, for so far considered separate issues, can be managed with each other.

Following these developments, the World Commission on Environment and Development, chaired by Gro Harlem Brundtland of Norway, continued to call for sustainable development, culminating in the preparation of the Brundtland report entitled “Our Common Future”4. As mentioned, the report defines sustainable development as development that meets the needs of the present generation without compromising the ability of future generations to meet their own needs especially the basic needs of the world's poor (who must come first); and the idea of limits placed by the technological state and social organization on the environment's ability to meet present and future needs (Kates et al., 2001).


For sustainable development to happen, it must take into account the environmental, social and economic aspects of the country's life. Social, environmental and economic sustainability as mentioned in element underneath;

- Social sustainability: this is an aspect of sustainable development. Social sustainability includes human rights, labor rights and corporate governance. In common with environmental sustainability, social sustainability is the idea that future generations should have access to social resources equal to or more than present generations ("fairness between generations"), while also requiring equal access to social resources in the present generation ("Intra-generation Equity"). Social resources include ideas as broad as other cultures and basic human rights.

Human development can be seen as development that enhances the capabilities of present people without compromising the capabilities of future generations (Sen, 2000). In the human development model, environment and natural resources must be the means to achieve better living standards as income is the means to increase social spending and ultimately happiness (Anand and Sen, 1996).

Social sustainability is often taken into account in socially responsible investing (SRI). Social sustainability is concerned with the continual improvement of social welfare and quality of life. It focuses on indicators of social and human development. Indicators examined include infant and child mortality, life expectancy at birth, maternal mortality, HIV prevalence, malaria prevalence, tuberculosis prevalence, and population growth rate number, total birth rate and urbanization rate. According to social indicators, the following indicators are assessed as percentage of the population living below the poverty line, adult literacy rate, primary and lower secondary school enrollment rates, population percentage access to improved sanitation and access to population (Ogujiuba, 2013).

- Economic sustainability: Since then, economists have focused on seeing the economy and the environment as a single system, linked together with a unified assessment method (Hamilton 1999, Dasgupta, 2007). Intergenerational equity can be incorporated into this approach, as has become commonplace in economic assessments of climate change economics (Heal, 2009). By eliminating discrimination against future generations and enabling the possibility of renewable alternatives to petrochemicals and other non- renewable resources, effective policies are compatible with increasing human welfare, eventually achieving the steady state of the golden rule (Ayong, 2001 and Endress et al., 2005). Thus, the three pillars of sustainable development are interconnected, intergenerational equity and dynamic efficiency (Stavins et al., 2003).

Agenda 21 of UNESCO Convention on the Protection and Promotion of the Diversity of Cultural Expressions (2005) clearly identified information, integration, and participation as key building blocks to help countries achieve development that recognizes these interdependent pillars. It emphasizes that in sustainable development everyone is a user and provider of information. It stresses the need to change from old sector centered ways of doing business to new approaches that involve cross-sectoral coordination and the integration of environmental and social concerns into all development processes (Will, 2007).

- Environmental sustainability: Environmental sustainability is the process of ensuring that existing processes of interaction with the environment are continued with the aim of keeping the environment as pristine as possible based on ideal seeking behavior. It deals with maintaining the integrity of various environmental media and systems to ensure that their beneficial functions and uses are maintained for present and future generations.

Environmental sustainability indicators include; CO2 (carbon dioxide) emissions per capita; million tons of methane emissions; emissions of common anthropogenic pollutants; ratio of degraded land, forest area to total land area; rate of threatened species; water usage rate; water stress and scarcity; and total fish production. The assessment is carried out in an integrated manner to highlight the links between different environmental themes and between environmental aspects and economic and social aspects of sustainable development. Themes include three mediums: atmosphere, land and water. In addition, over-reliance on natural resources has led to resource depletion and environmental degradation, while making weaker economies exposed to external shocks worse, thereby increasing poverty and reversing social development (World Bank, 2003).

Preserving the environment is an essential foundation for sustainable development and poverty reduction. For example, failure to achieve stability in biodiversity will undermine efforts for economic and social development, protect farmland, provide low-cost, renewable energy and improve the urban environment (Environmental Consultants Association of Western Africa (ECA-WA, 2010). Unfortunately, the uncontrolled exploitation of natural resources such as forests, land, water and fishing, often by a powerful few, has caused alarming changes in the natural world of over the past decades, to the detriment of the world's most vulnerable people, who depend on natural resources for their livelihood (Nyong, 2005).

The concept of sustainability is likely to continue to influence future discourses on development science. This, according to Porter and van der Linde (1995), implies that the best options may still be those that are socially responsive and environmentally friendly and economically efficient, economically and socially equitable, and socially and environmentally sustainable. This leads to three interconnected sustainability domains or domains that describe the relationship between the environmental, economic and social aspects of SD, as illustrated below:

Fig 1: Relationships among Social, Environmental and Economic Sustainability

Abbildung in dieser Leseprobe nicht enthalten

Basically, it can be concluded from the numbers that almost everything humans do or plan to do on earth has implications for the environment, economy or society and for that matter survival continuity and happiness of mankind. The spheres form a set of interrelated concepts that will form the basis of human decisions and actions in the SD task.

Resource management will lead to sustainable growth for a sustainable society (Wanamaker, 2018). Examples of these include decisions about land use, surface water management, agricultural practices, building design and construction, energy management, education, equality of opportunity as well as law-making and enforcement (Montaldo, 2013) Argues that when the concepts in the three areas of sustainability are well applied to real-world situations, everyone wins because natural resources are conserved, the environment is protected environment, a thriving and resilient economy, and a good social life because of peace and respect for human rights (DESAUN, 2018; Kaivooja et al., 2013).

Kahn (1995) and Basiago (1999) provide a striking illustration of the relationship between economic, social and environmental sustainability, arguing that the three areas must be integrated for the sake of sustainability. According to Khan (1995) cited in Bassiago (1999):

“If a man in a certain geographical area is out of work (economic), he is likely to be poor and deprived of his (social) rights; If he is poor and deprived of his rights, 5 Porter and van der Linde (1995) he is encouraged to engage in activities harmful to the environment, such as cutting down trees for firewood for cooking and heating his house (environmental). Because its actions are combined with those of others in the felling area, deforestation deprives the soil of important (environmental) minerals, for example, how computers operate, and this will lead to reduced or stagnant (economic) productivity. If productivity stagnates (economic), the poor will remain poor or poorer (socially) and the cycle continues."5

The above hypothetical case illustrates the link between three interconnected areas of sustainability and the need to integrate them for SD (Basiago, 1999). Interactions and can promote SD (Basiago, 1999; Khan, 1995).


Sustainable development refers to the principle of achieving human development goals while maintaining the capacity of natural systems to provide natural resources and ecosystem services that economies and societies cannot afford society depends on it (Cerin, 2006). Although the concept of sustainable development has been relevant since time immemorial, it could be argued that the relevance is deepening at dawn every day because the population is constantly growing, but it is not a natural resource available to mankind.

Aware of this phenomenon, global concerns have always been expressed about the proper use of available resources. The last of these concerns translates into the Millennium Development Goals (MDGs) and the Sustainable Development Goals (SDGs). The MDGs are the continuation of the SDGs. The MDGs mark a historic global campaign to achieve a range of important social priorities around the world (Breuer et al., 2019). However, despite the relative effectiveness of the MDGs, not all of the eight goals were achieved post-implementation. As part of this new development roadmap, the UN adopted the 2030 Agenda (SDGs), a call to action to protect the planet, end poverty and ensure human happiness (Taylor, 2016). The 17 SDGs are primarily intended to achieve the following summarized objectives.

- Alleviating poverty, ensuring a healthy life;
- Universal access to basic services such as water, sanitation and sustainable energy;
- Supporting development opportunities through inclusive education, good jobs and inclusion;
- Promoting innovation and resilient infrastructure, by creating communities and cities that are productive and sustainable;
- Reducing inequality around the world, especially on gender-related issues;
- Ensure the integrity of the environment by combating climate change, protecting oceans and terrestrial ecosystems;
- Promoting cooperation among members' different parts of society to create a peaceful environment and ensure responsible consumption and production (Hylton, 2019).

According to the United Nations Communications Group (UNCG) and Civil Society Organization (CSO) 2017 SDG Forum in Ghana, the SDGs are a global call to action to alleviate poverty, protect and ensure peace and prosperity for all by 2030. Adopted by 193 countries, the SDGs entered into force in January 2016 and aim to promote economic growth, ensure social inclusion and protect the environment. UNCGCSO (2017) argues that the SDGs encourage a spirit of collaboration between governments, the private sector, research organizations, academia and civil society (CSO) - with the support of the UN. This partnership aims to ensure that the right choices are made now to improve lives, in a sustainable way, for future generations (Breuer et al., 2019).

The 2030 Agenda has five broad themes, known as the Five Themes: People, Planet, Prosperity, Peace and Partnership, comprising 17 SDGs (Hylton, 2019; Guo, 2017). They aim to address the root causes of poverty, covering areas such as poverty, health, education, gender equality, water and sanitation, energy, economic growth, industry, change innovation and infrastructure, inequality, sustainable cities and communities, consumption and production, climate change, natural resources and peace and justice.

It can be said from the SDGs that sustainable development is about achieving social progress, environmental balance and economic growth. The main feature of the SDGs is that their development goals and targets are fundamentally interdependent but interdependent (Tosun and Leininger, 2017). It has been suggested that SDGs involve complementarities or synergies as well as trade-offs or tensions that have implications for global and national contexts. Complementation implies that solving one goal can help solve other goals at the same time. For example, addressing the issues of climate change can equally benefit energy security, health, biodiversity and the oceans (Le Blanc, 2015). (2018), it is important to note that the SDGs are not independent targets. Kumar et al., 2014 ;).

Besides complementarities and synergies, SDGs also have trade-offs and tensions that come with difficult choices that can lead to winners and losers, at least in the short term. For example, Espey (2015) argues that biodiversity can be threatened if forests are cut down with the aim of increasing agricultural production to ensure food security, while Mensah and Enu Kwesi (2018) also argue that food security may be at risk if food crops are replaced by biofuel production to ensure energy security. The implication is that it is not easy to strike a delicate balance between achieving high levels of economic growth to contribute to poverty alleviation and preserving the environment. 2015), addressing climate change (Goal 13) is a prime example of competing interests. In other words, those affected in the short term, such as fossil fuel companies and their workers, will see themselves as 'losers' if they are forced to change, even though society as a whole will be the ultimate 'winner' in the long term by avoiding the risks and impacts of climate change (Tosun and Leininger, 2017). Keitsch (2018) continues that compromises can present governance issues in the case of complex issues in SDGs where the interests of different stakeholders are in conflict.

According to Spahn (2018), another major challenge is ensuring accountability and accountability for progress towards achieving the sustainable development goals. Some commentators, researchers and scholars (Mohieldin, 2017; Yin, 2016) argue that this requires appropriate indicators and means to monitor and evaluate progress towards SDG implementation, especially at the national level (Kanie and Biermann, 2017). In this regard, it is important to measure both inputs and outputs to check whether different countries are investing what they intend to invest. by solving problems, as well as monitoring results to check that they actually meet the set goals and targets (Allen et al., 2018; Breuer et al., 2019.

The United Nations Conference on Sustainable Development, held in Rio de Janeiro, Brazil in 2012 highlighted several key issues, including decent work, energy, sustainable cities, food security and Sustainable agriculture, water, oceans and disaster resilience need to be prioritized. For example, in the food and agriculture sector, the Department of Economic Affairs and Social Affairs ([DESA], 2013) estimates that around 800 million people are undernourished worldwide and need about 220 million hectares of additional land to grow them feed world population is increasing to 2030.

The estimated value of income and savings from achieving the Sustainable Development Goals in the food and agriculture sectors is $2.3 trillion. The three main opportunities in the food system are food waste reduction, reforestation and low-income food market development, which is expected to create 71 million jobs in food markets, including 21 million in Africa and 22 million in India, where large arable land and current low yields pave the way for growth (DESA, 2013). According to Ritchie and Roser (2018), more than half of the world's population already live in urban areas and this number is expected to increase further to two-thirds by 2050. This will bring costs socioeconomic and interests in many fields industries and livable cities to expand their activities, thereby stimulating employment.

According to Jaeger et al. (2017), the potential gains from achieving the sustainable development goals in cities are estimated at $3.7 trillion, with an estimated 166 million new jobs in the construction sector, efficiency facilities, affordable housing and developing other urban opportunities. More than 1.5 billion additional energy consumers are expected by 2030, which is expected to create approximately 86 million jobs and $4 in revenue.3,000 billion thanks to the potential profits of circular models, renewable energy, energy efficiency and energy accessibility. In addition, as estimated by Jaeger et al., (2017), approximately $1.8 trillion in income is likely to be obtained through improving healthcare leveraging technological innovation and other improvements in relation to the global health system, which are expected to create about 46 million jobs through new health business opportunities.

In addition, friendly infrastructure is required environmentally friendly to increase economic output and productivity (Waage et al., 2015). These figures include some of the $200 billion to $300 billion needed to ensure that infrastructure leads to lower emissions and greater resilience to climate change. According to UNDP (2012), a relatively low estimate of the total annual cost of climate change mitigation and adaptation by 2030 is 249 billion USD; and this only addresses one threat (global warming) to the global environment. However, official development assistance (ODA) funding accounts for a relatively small amount of capital, at about $130 billion per year (UNDP 2012). Other costs of implementing SDGs include the risk of over­mining and the huge financial resources required for various investments. These suggest some socioeconomic costs and benefits of the SDGs, but the parameters for assessing the impact of the SDGs are controversial (Campagnolo et al., 2018).

In light of the debate about the costs and benefits, trade-offs, complementarities and complexity inherent in the SDGs, the relevant question is how the United Nations can enforce the SDGs of countries. In this regard, the United Nations should take into account the different capacities, capacities and levels of development of countries and respect national policies and priorities, ensuring that their policies and priorities in this country focuses on sustainable development (Tosun and Leininger, 2017). Although all SDGs are generally applicable to developed and developing countries, the challenges they present may differ in different country contexts (O'Neill et al., 2018). Therefore, the UN should emphasize universality with a country-specific approach to global goals (Allen et al., 2018).


1 Mesarovic, Mihajlo and Pestel, Eduard (1975). Mankind at the Turning Point: The Second Report to the Club of Rome by

2 United Nations General Assembly, (1987); Anderson, (2006)

3 Meadows, (1972)

4 Goodland and Daly (1996)

5 Khan (1995) cited in Bassiago (1999)

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The Consequences of Unsustainable Business Development in Africa
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consequences, unsustainable, business, development, africa, sustainable bussiness practice, curruption, unsustainable environmental practices, No respect and regulations to environmental laws in africa.
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Dr. James O. Mbakpuo (Author), 2022, The Consequences of Unsustainable Business Development in Africa, Munich, GRIN Verlag,


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