Bridging the digital divide in Africa to propel economic growth

• There is urgency in halting the digital divide in Africa as this is vital in promoting inclusive growth, alleviating poverty, and generating more jobs through the digital economy.
• Kenya is setting an example by ensuring all its buildings are fiber-optic-ready.
• Digital automation in trade has proven to be a valuable asset in safeguarding Africa’s social and economic growth.

Digital Divide in Africa

Digital divide in Africa has been exacerbated over the years and, the urgency to halt it is vital in promoting inclusive growth, alleviating poverty, and generating more jobs through the digital economy.

Africa, with a population of 1.4 billion, currently has only 473 million internet users, representing a 36 per cent penetration rate and a mere 5 per cent fixed broadband penetration due to limited undersea connectivity. This leaves the continent lagging behind other regions regarding digital infrastructure, a critical component for economic growth.

African policymakers should capitalise on the transformative potential of digital technologies and propel the continent’s economic progress, underlining the need for immediate action.

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Inside the The Connected Africa Summit 2024

The Digital Economy Foresight Africa 2024 report, released at the Connected Africa Summit 2024 in Nairobi, Kenya, calls on African policymakers to expand fixed broadband, tackle affordability issues, and improve access to digital infrastructure to close substantial gaps and promote inclusive economic growth.

President William Ruto of Kenya stressed the importance of African youth as the drivers of digital transformation and the need to leverage the African Continental Free Trade Area (AfCFTA) to expand the collective GDP from $1.7 trillion to $2.5 trillion by 2030. “The African youth are the builders and beneficiaries of a digitally-enabled society,” Ruto stated at the summit.

policymakers should develop policies that attract investments and build digital infrastructure to close the digital divide. Collaboration among ICT authorities and regulators across the continent is anticipated to help accelerate connectivity and increase the digital economy’s contribution to Africa’s GDP to $712 billion by 2050.

Kenya is setting an example by ensuring all its buildings are fiber-optic-ready. The goal is to connect 12 million households with fixed broadband by 2030. ICT and Digital Economy Cabinet Secretary Eliud Owalo stresses the significance of an inclusive approach to addressing emerging issues like artificial intelligence, big data, machine learning, and cybersecurity.

The Connected Africa Summit 2024 aims to provide a clear tech roadmap for Africa, enhance digital public infrastructure, explore opportunities in the digital space, and develop sound legal and regulatory frameworks to anchor digital interventions. Policymakers will develop recommendations on how Africa can seize opportunities in the global technological space.

Unlocking Africa’s Digital Potential

African leaders must prioritise digital infrastructure development and bridge the significant gaps in fixed broadband access, affordability, and digital skills. By addressing these challenges head-on and fostering collaboration across the continent, Africa can unlock the full potential of its digital economy and drive inclusive growth for itself.

In Africa’s current socioeconomic climate, digitally driven development initiatives are crucial.

There have been notable woefully inefficient mobile Internet access in African countries, hampering poverty reduction and job creation. Limited access to sufficient capital and poor digital infrastructure have widened the problem.

A report by the World Bank indicates that Africa has the world’s youngest and fastest-growing population, an indicator that by 2100, Africa will have the largest share of the global workforce.

This demographic potential will be significantly enhanced by the thriving tech hubs emerging in urban centers where many business people are joining forces to teach and deliver affordable and sufficient digital access, skills, and technologies tailored to the local needs of people in different regions.

Promising solutions emerging in digital inclusion

Digital technology is a fundamental right. Tele-cel Group has been expanding its operations across the continent to facilitate widespread mobile broadband access, including in the poorly connected West Africa region, notably Senegal, Liberia, and the DRC.

Public policies supporting leading tech innovation hubs in Africa are demonstrating the reality of homegrown tech in international trade and integration in unlocking africas’ social and economic growth.

For instance in Cape Town, the South African government’s technology fund and tax incentives have spurred a significant growth of fintech and e-commerce start-ups. At the same time, Nairobi’s thriving “Silicon Savannah” ecosystem has significantly benefitted from the Kenyan government’s International Financial Center, which supports investors and helps local fintech start-ups identify funding opportunities.

Digital automation in trade for economic growth

Digital automation in trade has proven to be a valuable asset in safeguarding Africa’s social and economic growth. Due to recurrent global shocks, it was predicted that the trade industry, primarily the import and export industry, would collapse due to the effects of global borders and trade routes lockdown. However, through the leveraging of import/export platforms such as Single Window, for instance, during the COVID-19 pandemic, Nigeria was able to overcome this barrier as operations continued unabated.

Additionally, the creation of online international trade administration portals has made trading easier for many stakeholders, including customs officials and entrepreneurs importing and exporting finished goods or raw materials for manufacturing globally.

Nevertheless, blockchain technology, Artificial Intelligence (AI), state-of-the-art payment solutions, fraud detection and prevention, and digital warehouse management solutions are helping in easing the complicated procedures in trade, streamlining border management, identifying and potentially solving issues that impact timeframes, logistics, and transportation.

Conclusion

Policymakers and governments in African nations are committed to building a better digital economy to improve the lives of young people on the continent.

There are notable strides towards digital integration across Africa. However,  harmonising policies and regulatory frameworks, regional funding for digital infrastructure, and investment in developing digital public infrastructure are vital.

Being more agile than their extensive and complex business counterparts, SMEs can quickly change their marketing plans and adopt new technologies to enhance their operations. Digital innovation gives SMEs opportunities and empowers them to implement new market strategies with a greater line of sight across their business, improve traceability in moving cargo, meet their customers, provide services, and meet logistics partners on the same page.

In developing the digital trading space, solutions such as import/export digital platforms, automated cargo-tracking systems, and digital reporting platforms of non-tariff barriers provide efficient cross-border trade, giving SMEs an efficient playing field. This is good for entrepreneurs, customers, and communities as they serve the continent’s economic growth on a broader scale.