Africa Goes Digital – IMF F&D
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Bibliographic details
- Authors: CRISTINA DUARTE
- Published: March 1, 2021
Overview
- Author: CRISTINA DUARTE, special adviser on Africa to United Nations Secretary-General António Guterres and former finance minister of Cabo Verde.
- Publication: F&D Magazine, March 2021.
- Core thesis: As Africa rebuilds from COVID-19 disruptions it must not return to a pre-pandemic reality; it must build a better reality that recognizes the need for innovation, particularly digital technologies, as a prerequisite for addressing poverty, health, productivity, competitiveness, economic diversification, food security, climate change, and governance.
Key statistics and findings
- Rwanda: 90 percent of the country has access to broadband internet, and 75 percent of the population has cell phones.
- Continental internet usage: Only 28 percent of Africans use the internet.
- Technology hubs: More than 600 technology hubs have emerged across the continent; three have achieved international recognition: Lagos (Nigeria), Nairobi (Kenya), and Cape Town (South Africa).
- AfCFTA: The African Continental Free Trade Area aims to create a single market with a combined GDP that exceeds $3.4 trillion and includes more than 1 billion people.
- Entrepreneurial activity: The World Economic Forum’s Africa Growth Platform noted entrepreneurial activity was 13 percent higher in its initial stage than the global average.
- Policy gap: According to a 2018 WEF report, 22 of 25 countries analyzed had no public policies focused on an ecosystem for innovation.
- Economic impact: An International Telecommunication Union study found that 10 percent greater mobile broadband penetration would generate a 2.5 percent rise in Africa’s GDP per capita.
Digital divide and structural constraints
- The digital divide is multifaceted: access to the internet is only one dimension; electricity, literacy, financial inclusion, and regulatory frameworks are often missing and limit effective use of digital solutions.
- Millions face overlapping deprivations—conflict, food insecurity, lack of electricity, clean water, education, and health care—leaving them unable to benefit from online services, a situation exacerbated by COVID-19 lockdowns and social distancing.
- Civil society and the private sector have driven much of the digital progress (incubators, start-ups, tech hubs, data centers), while top-down policymaking and public investment in digitalization lag.
Opportunities accelerated by COVID-19
- The pandemic contains opportunities to innovate and reimagine Africa’s economic structure, service delivery systems, and social contract, accelerating trends such as digitalization, market consolidation, and regional cooperation.
- Examples of digital responses to the pandemic:
- Kenya: FabLab created Msafari, a people-tracking application to trace spread of infections.
- Morocco: Wiqaytna6, a similar application.
- Rwanda: real-time digital mapping to track COVID-19 spread, expanded telemedicine, and chatbots for public updates.
Ongoing initiatives signaling receptivity to change
- African initiatives cited as indicators of receptivity:
- AfCFTA (see above).
- South African government’s new Centre for the Fourth Industrial Revolution of the World Economic Forum (WEF).
- WEF’s Africa Growth Platform to help companies grow and compete internationally.
Policy recommendations and priorities
- Shift focus from managing poverty alone to retaining and creating wealth, better resource management, inclusiveness, moving up global value chains, economic diversification, optimizing the energy mix, and centering human capital.
- Prioritize investment in research, development, and innovation (R&D&I) to reboot economic structures and close technology gaps.
- Scale up digitalization forcefully by policymakers—digitalization cannot be left mainly to civil society and the private sector.
- Build an ecosystem for innovation that includes:
- Well-calibrated regulatory frameworks.
- Investment in digital infrastructure.
- Investment in digital skills and human capital.
- Promotion of financial inclusion.
- Address legal and ethical implications of technology adoption, including privacy, data governance, and tax evasion, recognizing that weak institutions may struggle to protect citizens’ rights against market forces.
Source: Africa Goes Digital – F&D Magazine, CRISTINA DUARTE, March 2021.
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