Advancements in technology have had a significant impact on the global economy. The African economy has been included, and technological advances are gradually transforming various sectors of the economy. This white paper will examine how technological advancements impact the African economy and the potential benefits and challenges of the technological revolution.
Africa is adapting to changes fast, and its population demographic (higher population of youths) has made it even easier for adoption.
The current state of technology in Africa
In recent years, there has been a significant increase in technology adoption in Africa. According to the World Bank, the number of internet users in Africa increased from 2.1% in 2005 to 28.2% in 2020. Mobile phone penetration has also increased, with over 500 million mobile phone subscribers in Africa. Additionally, the continent is seeing an increase in investments in technology, with various tech startups and accelerators emerging across the continent. Today, Africa has produced more unicorn companies from technology than any other in shorter times.
Increased access to information and communication
Advancements in technology have provided Africans with greater access to information and communication. With the rise of mobile phones and the internet, individuals and businesses can communicate and access data anywhere. This has improved productivity and efficiency in various sectors, such as healthcare, agriculture, and education.
Improved access to financial services
The rise of fintech startups in Africa has increased access to financial services, particularly for the unbanked and underbanked populations. Mobile money platforms, such as M-Pesa in Kenya, Paga, Flutterwave, MonniePoint, and ConnectPoint in Nigeria, have revolutionized how people send and receive money, pay bills, and access credit. This has provided opportunities for entrepreneurs and small businesses to access financial services, which has led to increased economic growth and reduced poverty levels.
Increased job opportunities
The rise of technology in Africa has created new job opportunities, particularly in the tech industry. The growth of tech startups and accelerators has led to the creation of jobs in various fields, such as software development, data analysis, and digital marketing. This has also led to increased innovation and competition, which has led to improved products and services across various sectors. In Nigeria alone, the Central Bank of Nigeria has licensed over 150 financial technology companies offering numerous services, creating at least 5,000 direct job opportunities supporting more than 500,000 Micro, Small, and Medium businesses nationwide. Technology has helped the African economy more than we thought, and there is still space for unexplored areas in manufacturing, Agriculture, healthcare, housing, etc.
Challenges of technology in Africa
One of the significant challenges facing technology adoption in Africa is the need for adequate infrastructure. Governments and private sector stakeholders need to invest in infrastructure to support the growth of technology in Africa. Many parts of Africa still need access to reliable electricity and internet connectivity, which limits the potential of technology adoption in various sectors.
There is a significant skills gap in the African tech industry, particularly in software development and data analysis. This limits the potential of the tech industry to create more jobs and contribute to the economy’s growth. Governments and private sector stakeholders need to invest in education and training programs to bridge the skills gap in the tech industry.
The rise of technology has also increased the risk of cybercrime and cybersecurity threats in Africa. Many African countries lack adequate cybersecurity policies and infrastructure, which puts individuals and businesses at risk of cyber attacks. Governments and private sector stakeholders need to invest in cybersecurity infrastructure and policies to mitigate the risks of cyber attacks.
Education & Research
The current infrastructure of our educational sector needs to provide adequate support for research that could drive innovation. Whether it’s the education policies, infrastructure, or lack of appropriate research fellows, the impact and potential of such research still need to be explored. Despite the presence of technology and research investment by several companies in universities, they tend to offer grants to a select few who need proper oversight on utilizing such funding.
The government must intervene and provide support to unlock research and innovation potential in manufacturing, aerospace, drone technology, 3-d, and artificial intelligence. The government’s involvement in this sector can significantly shape the educational infrastructure and policies required to facilitate impactful research that can drive innovation and have real-world applications.
Africa needs to build her own using her talent and her resources.
Technology advancements can transform the African economy and create new opportunities for growth and development. However, to fully realize the potential of technology in Africa, there is a need for governments and private sector stakeholders to invest in infrastructure, education and training programs, and cybersecurity policies and infrastructure. By addressing these challenges, Africa can leverage technology to drive economic growth and improve the lives of its citizens.
You can also read my recent article here Rising Africa and her Opportunities
Lawrence is a Cards, Payments, Project Management and Sales Expert with over 16years in the Financial Sector. He is passionate about Excellence, Leadership and Innovation, currently chasing interest in digital Payment solutions, blockchain technology, financial Inclusion & tech startups.
Author of the book, Discover, Develop, Deploy
Lawrence has founded several businesses including a Licensed Fintech in Nigeria. He loves writing and sharing knowledge with his audience.
You can reach him on any of his social media handles for enquiries and collaborations.