The ICT sector has possibly the most to gain in an African economic boom, as ICTs underpin every development initiative in every industry. Connectivity in particular, is crucial for development. From agriculture and education to enterprise development, ICT is a crucial factor in modernising and optimising every sector.
And because nobody understands Africa like Africa itself, African ICT companies should be expanding across borders to deliver relevant solutions that support overall social and economic growth and development. Yet, we are seeing many African ICT players slow off the mark, hesitant to expand into neighbouring countries and losing the ICT market share race to major international players.
Ayanda Dlamini, Business Development Manager for LGR Telecommunications, says services such as e-Commerce and m-Commerce, telecommunications, advertising and social media are some of the end consumer services that depend heavily on good ICT infrastructure, policies and ICT enablement programmes. Spanning across multiple sectors; agriculture, health, education and government over and above commerce, African ICT must seize the opportunities presented on the continent.
Why is connectivity in particular crucial for development?
Connectivity is a development enabler: enhancing instant collaboration across borders (which improves the virtual workforce), enhancing data transfer and information sharing and facilitating the development of newer business models. Even within a country, the standard of living is better and grows faster in connected areas (these are typically urban areas) as opposed to areas without ICT facilities (typically rural communities). We have seen the impact of deregulation and the benefits that competition has had concerning the growth in the telecommunications sector in Africa. According to ITU, almost 20% of the population had access to the Internet by the end of 2014, up from 10% in 2010.
Why is it important for trade and industry that African ICT companies expand across borders
Connectivity drives economic growth and innovation. With the high smart phone penetration in Africa in the past five years we have seen mobile payment systems (mobile money) increasing tremendously, Sub Saharan leading with approximately 42 million active Mobile Money accounts, compared to the rest of the world at approximately 17 million active accounts combined (according to the latest State of the Industry report). Africa’s transportation prices are still relatively high, especially into land-locked states – and poor transportation can severely hinder trade. In cases where information and communication technology can replace traditional communication methodologies (like postal services) – it has often not only been faster, but also cheaper. Furthermore, Africa’s sustainable development will rely heavily on dependable connectedness for ease of collaboration, knowledge sharing, and skills development. This, in the long-term, can promote regional employment and raise living standards.
We are seeing many African ICT players slow off the mark, hesitant to expand into neighbouring countries. What effect will this have on our economy and on the sustainability of such companies?
There is a perception among businesses that doing business in Africa is unprofitable, complex or even dangerous. However, we see from the recent global economic crisis that companies that had expanded their operations into Sub-Saharan Africa were less affected, or not affected at all, by trouble in their western traditional economic hubs. Other slight barriers include cultural differences, language and business norms differing from country to country. While these can be mitigated through partnerships, a level of adapting is needed. While South African companies are correctly positioned and have an advantage over international players (although maybe not equal in financial muscle), Africa may be lost to international companies that are also actively chasing these opportunities in Africa. A missed opportunity would not only reflect in the direct revenue losses, but could also have an impact on related industry verticals and horizontals.
Can ICT contribute to improvements in education?
A pilot project in schools in Gauteng, enabling students to access textbooks, previous exam papers and library material on tablets, has recently attracted attention and is hailed as a success story. Learners and teachers have cited how this portal makes life easier from both sides; which is testimony that ICT can play a major role in education.
Can you please expand on the socio-economic benefits and disadvantages of ICT in Africa?
A lot of SMEs need an online presence to market their services and build a client base. In South Africa, SMEs are undoubtedly a livelihood for the economy at approximately 61% of the employment base. In Sub-Saharan Africa, successful SMEs will be those tapping into services like “Woza Online” to bridge the gap between them and their customers and growth; but internet access must exist. Keeping in touch with friends and relations is one of the major social benefits of ICT. The internet as an information super highway does however leave certain groups vulnerable – such as children being exposed to undesirable content in their innocent quest for information. The WWW and social media essentially have made everyone of us a publisher/journalist, able to distribute and share information with the least moderation. While we certainly appreciate easy flow of information, it is perhaps one of the weaknesses of today’s best inventions that we are slowly losing the aspect of moderation.
How do you see the role of ICT in business development and in trade and industry in Africa?
As observed in some of the African regional bodies (such as the SADC declarations ) and similar in East and Central Africa, barriers of electronic commerce open opportunities and increase access to markets, reduce administrative costs and improve Africa’s inclusion in the global economy.
To what extent has Africa embraced this relatively new concept and life-saver?
ICT has the ability to bring excluded communities such as rural areas into main stream economy, as the example of mobile money and USSD driven cellphone banking shows, however such communities do have challenges such as under developed ICT infrastructure, lower education (linked to inadequate skills ) and low usage of ICT based services and products.
Are policy adaptations needed to meet the end goals?
It would not only take conducive policies, but continuous capacity building programmes that are continuously aligned to the ever changing business landscape, to meet these goals. Effective engagement of customers and public as a whole (especially at grassroots level) would ensure that the key benefits are realised in the high impact areas (rural and under-served communities).
Are our policy frameworks, legislation and applications yielding results?
Good policy frameworks and legislations have started to emerge, but one believes a lot more can be done to apply these in order to realise results. A successful policy is one that addresses major concerns that arise with technological advancement; such as intellectual property rights, privacy, security, confidentiality, anti-piracy, censorship and info-ethics. Efforts have been made by individual countries – and there are success stories in some respects, but less progress have been made in other instances. Perhaps the time has come for enhanced collaboration across borders on the subject on a more implementation-focused approach.
Are policy/legislative changes desirable enough to make the transition happen? If so what needs to be amended?
Considerable steps have been taken towards improving universal access to communication, enablement of competition, improving efficiency, ensuring broadband access, fostering innovation and encouraging private sector investment in ICT. However a few challenges and questions still remain:
- Improving universal access to communication inclined policies such as geographically uniform tariffs can constrain regulators’ cost-based tariffing structure aimed at efficiency objectives.
- How may public investment step in to assist where gaps have been left, or deemed not so profitable, by private broadband service providers?
- VOIP and smartphone apps will continue to be game changers - but for the telecommunication operators some of these may undermine current service revenues.
If you were to be tasked to fix our ICT issues – what would be your plan?
I would ensure that the right skills exist through education and continuous training. International players do have a role in helping Africa develop skills and institutional support -- to boost confidence. It would be important to accelerate economic integration through fostering an accommodating climate; such as enforcing agreements (where they are in place) and setting trade agreements where they don’t exist. I would improve access to public information -- for instance by implementation e-government strategies; a by-product of this would be the promotion of transparency and democracy, ease of access to critical information for entrepreneurial initiatives and access to information can play a role in reduction of corrupt practises. ICT associated infrastructure like electricity, essentially one of the continents problem areas, would need to be improved as well.