In recent years, Africa has witnessed remarkable progress in harnessing the power of the digital realm to drive economic growth and foster innovation. From the bustling tech hubs of Nairobi and Lagos to the remote villages where mobile connectivity is transforming lives; the continent is experiencing a digital revolution that holds immense potential.
Skimming through my social media pages in my home office in Nairobi Kenya, I can attest that remarkable stories are unfolding, and new products are being launched showcasing the transformative power of technology, innovation and entrepreneurship.
Africa, a continent, once considered a latecomer to the digital revolution, has rapidly transformed itself into a thriving hub of innovation and technological development.
Investment to Increase Access
In 2022 the continent had around 570 million internet users according to Statista, with Nigeria, Egypt and South Africa topping the chart. Although the number more than doubled compared to 2015 mobile access to broadband internet in some parts of the continent remains low and requires investment.
“ While the reach of the internet, via mobile 3G+, has expanded significantly in recent years, there is still a coverage gap of over 800 million people who live in areas that are not covered by networks”
“Access is key, we are sitting at about 43% access compared to global trends at 66% access - we have work to do. To achieve it, we need fast-tracked investment in digital infrastructure” says Ryan O'Grady, Chief Executive Officer of Kush Investments.
Investments of nearly $97 billion in Sub-Saharan Africa could make internet access to the whole of the region a reality according to a recent UN study
Thriving Tech Ecosystem
According to the World Economic Forum, Africa’s digital economy could contribute nearly $180 billion to the region’s growth by 2025, accounting for 5.2% of the continent's GDP. This will be driven forward by increased access to faster and better quality Internet connectivity, a growing tech talent pool, a vibrant startup ecosystem, and Africa’s AFCFTA commitment to creating the world’s largest single. The rapid proliferation of mobile technology and internet access will further strengthen Africa’s tech ecosystem and birth new innovative solutions to tackling developmental challenges.
“Africa’s startup ecosystem and entrepreneurs continue to bridge the digital divide and drive innovation through impactful solutions across the board. They are providing innovative and impactful digital solutions from the likes of M-Pesa and other fintech solutions that have given access to the previously unbanked parts of the population,”
“When a livestock farmer in rural Somaliland can access markets in Saudi Arabia via their mobile data, booking a sale, setting a price, arranging shipments from Berbera – that is the impact of mobile technology. This is a great example of what we would think of as “non-digital” sectors making use of the digital economy today,” says O’Grady
High internet costs
Despite the boom in Africa’s connectivity, high internet cost remains a stumbling block. The prevalent issue of affordability is often the cause of individuals being "covered but not connected" to internet services. According to the Worldwide Mobile Pricing 2022 report, which surveyed 233 countries and territories, sub-Saharan Africa is home to five of the top 10 most expensive countries for purchasing mobile data.
In these countries, mobile data prices are exorbitantly high, with 1GB costing at least $10. This cost is approximately 250 times more expensive than Israel, known for having the world's most affordable data rates.
“We need to focus on lowering the cost of accessing the internet in Africa. Many companies across the continent face very high infrastructure deployment, borrowing and operation costs. Stakeholders need to pay attention to the innovation that needs to be built into the infrastructure deployment to lower these costs and enable higher inclusion through lower pricing”
“We at Kush Investments Africa are working with our partners at Al Qalaa Group to drive investment onto the continent to increase access to the digital space. Strong digital infrastructure means affordable and reliable access to the digital spectrum. With that we can talk better and higher inclusion” says O'Grady
In June this year, Kush Investments partnered with AlQalaa Group’s Sparkle to provide long-term solutions in the upcoming Blue & Raman Submarine Cable Systems to serve the East Africa region.
“Together we are bringing expertise and support along with financial strength to an overall digital play in Africa. We will offer some of the fastest connections and the best prices for connecting Africa globally. We also have an integrated suite of infrastructure services that we are preparing to deploy that builds on this initial connectivity and enables us to play a significant role in key markets across the continent”
Continuous investments in subsea cables are pivotal for establishing reliable internet connections, particularly in the first mile within a country. These "backhaul infrastructures" empower mobile operators to boost data capacity, reduce network costs, and improve performance. However, to bridge coverage and usage gaps, investments are needed in the middle, last, and invisible miles. By strategically investing in these areas, African countries can extend internet access beyond its entry point and bring connectivity to those currently without it.
Enabling Africa's digital connectivity transcends mere opportunity cost; it is a profound calling. Recent data shows that countries such as Norway, Saudi Arabia, and the United Arab Emirates have attained the highest global internet penetration rates. The correlation between their economic advancements and internet access is evident. Ensuring widespread internet access for all individuals carries the significant potential to deliver benefits to virtually everyone on the continent.
“Africa and innovation go hand in hand, its ingenuity and perseverance is the hallmark of the history of this continent. The digital economy will be no different, it will be a story of hard effort leading to leapfrogging of growth in the next few decades,” insists O’grady