Ladies and gentlemen, it is an honour to witness the 10th Digital Africa Conference and Exhibition, Africa’s premier consumer technology show. For a decade, Digital Africa has been an advocate and breeding place of informed debate and independent analysis, on issues to do with tech and Africa, leading to the generation of new, incisive policy proposals. I appreciate our sponsors for supporting our global view in tackling some of the world’s biggest challenges, in the spirit of apolitical, rational thought. In today’s world, such collaboration is more important than ever before.
Ladies and gentlemen, in this presentation, I provide a picture of innovations and IT diffusions currently occurring in Africa and reflect on how technology and innovation can position the continent in the global tech race. As is well known, many interdependent factors come into play when discussing such a broad topic – some of which offer considerable advantages to Africa, while others may impede growth in the continent if not well managed.
Let’s begin with acknowledging the truths about some of our challenges in Africa. Africa is home to 17.51 per cent of the global population but makes up 3.6 per cent of global GDP and carries 25 per cent of the global disease burden. Moreover, our continent accounts for 4.95 per cent of total global health expenditures in 2019, 2 per cent of world research output, 1.3 per cent of research spending and 0.1 per cent of world patents. All the foregoing show that the continent has a long way to go, to catch up with the rest of the world.
Nevertheless, our strengths are considerable and profound. According to the World Economic Forum, by 2034, Africa will be home to the world’s largest population of working-age adults. While this is a demographic boon with profound potential, we can be sure that, without sound, forward-looking policies that derive their strength from science, technology, and innovation, it can become a bane. Therefore, our collective task is to shape the future so that the benefits of technological development will reach every African.
Africa is demonstrably doing things that are profound in isolated but critical areas of technology and innovation. It is starting to attract private equity and venture capital: 650 Venture Capital (VC) deals raising $5.2 billion in total, were recorded in 2021, marking a 104% increase from the 319 reported in 2020. This reflects a welcome maturation in Africa’s entrepreneurial space. The number of VC deals recorded last year alone corresponds to 70% of total VC deals recorded on the continent between 2014 and 2020, and 41% for the period 2014 to 2021.
New Tech-friendly Policies
Governments across Africa stepped up their policy legislative game around entrepreneurship in 2021 with a wave of FinTech-related regulations. Egypt introduced legislation allowing their Central Bank to allocate banking licenses to Fintech and digital commerce firms, a first for them.
Kenya’s Capital Markets Authority instituted a Regulatory Sandbox Platform through which they admitted nine FinTech startups to live-test their products and services in a controlled environment, free from the constraints of existing regulation.
Uganda’s Capital Markets Authority partnered with the European Union and FSD Uganda to establish the Deal Flow Facility. This technical assistance/match-making initiative is meant to address the gap emerging businesses in Uganda face when trying to access growth capital.
South Africa’s government introduced a startup visa programme to stimulate private sector growth. The proposed initiative would enable entrepreneurs to live and start a business in the country, potentially attracting high-impact investors and entrepreneurs to its shores.
The Nigeria Startup Bill was approved by the country’s Executive and is now pending Parliamentary approval. Co-created as a joint initiative between Nigeria’s tech ecosystem and the Presidency this law shows a way to create an enabling regulatory environment from the bottom up. “Nigeria’s example paves the way for other Regulators across the continent endeavouring to keep up with the momentum of the ecosystem’s expansion, to ensure legislation is enabling, adaptive and inclusive,” (Venture Capital in Africa report).
Start ups
According to Venture Capital in Africa report, the year 2021 experienced a proliferation of startups offering practical yet innovative solutions to address urban mobility challenges in Africa’s cities. Startups such as Kenya’s electric vehicle ride haling company NopeaRide. Togo’s transport technology platform Gozem and Nigeria’s motorcycle-taxi app Max.neg all leverage technology to improve the accessibility and affordability of mobility services and each raised funding in 2021. Meanwhile, six African tech startups have been named by the World Economic Forum (WEF) among its selection of the 100 most promising Technology Pioneers of 2022, three of which are from Kenya. They are e-health startup Access Afya, e-commerce fulfillment platform Sendy, and agri-tech solution Pula. The other startups named as WEF Technology Pioneers are Nigerian API fintech startup Okra, Rwandan e-moto platform Ampersand, and Cameroonian fintech Ejara.
Unicorns
Ladies and gentlemen, Africa is growing the unicorns. In 2021, 15 companies concluded deals valued at more than $100 million, 13 in the financial sector, 2 in industrials and one in the consumer discretionary sector. Five of the super-sized deals were in companies headquartered in the US (Chipper Cash, Tala, Andela, Zipline International); three in Nigeria (Palmpay, TradeDepot and OPay); two in South Africa (MFS Africa and Tyme Bank); one in Senegal (Wave Mobile Money); one in Egypt (MNT-Halan) and one in Britain (Zepz).
Some Key Sectoral Innovations
Let us briefly look at Africa’s technological innovations in various sectors:
- Agriculture: Ghana-based companies Farmerline and Agrocenta offer farmers mobile and web technology for agricultural advice, weather information, and financial tips. Zenvus, a Nigerian startup, measures and analyzes soil data to help farmers apply the right fertilizer and optimally irrigate farms. The “Sparky Dryer,” the dehydration machine invented by a Ugandan engineer, uses biofuel to dehydrate produce and reduce food waste. In Kenya, Twiga Foods sees technology as a solution to agriculture’s fragmented market problem. Twiga’s improved supply chain, cold chain and material handling have reduced high food wastage in the market. African entrepreneurs and startups adopt technology to help farmers optimize productivity and reduce waste through data-driven “precision farming” techniques.
- Financial services: Flutterwave is a Nigerian fintech providing payment infrastructure for global merchants and payment service providers in Africa. Chipper Cash builds software to enable free and instant peer-to-peer cross-border payments in Africa and Europe, as well as solutions for businesses and merchants to process online and in-store payments. M-Pesa is a financial services platform operated by Safaricom in Kenya and South Africa’s Vodacom. It also runs its services through its subsidiaries in Tanzania, the Democratic Republic of Congo, Mozambique, Lesotho, Ghana and Egypt. It has been a life-changing innovation for the remittance world. Since launching in 2007, the service has impacted local access to financial products and services: today, financial inclusion in Kenya stands at 83%—up from 27% in 2006. The most significant thing about M-Pesa is the fact that it is a reminder that you have to know your environment very well to create lasting and useful solutions to the existing problems.
- Energy: Azuri, M-Kopa, and Mobisol have systems that specifically enable solar-powered radios, as well as TV and mobile phone charging. M-Kopa pioneered and kick-started the wider pay-as-you-go (PAYG) solar market. It combines the power of digital micropayments with IoT (Internet-of-Things) connectivity to make financing more accessible to over 1 million customers. In South Africa, the iShack project is a Public-Private Partnership (PPP) that unlocks government electricity subsidies – known as Free Basic Electricity (FBE) – to support the adoption of Solar Home Systems (SHSs) in Enkanini. KopaGas brought its proof-of-concept to market and has, since its establishment in 2014, connected over 1,300 low-income households to LPG-fuelled clean cooking, impacting 6,500 lives. The KopaGas Pay-as-you-Cook (PAYC) service has made clean cooking fuel affordable for low-income households. The key KopaGas innovation is that they increased the number of times a cookstove’s cylinder is refilled and used in one year – 8.6 times compared to industry standards of 4 times a year in Tanzania.
- Health: Ilara Health, founded in Kenya, produces affordable diagnostic equipment using AI, including a portable ultrasound device and a diagnostic app that detects respiratory infections from the sound of a cough. Afya Rekod (Kenya) equips patients and providers with a decentralized, user-generated medical data storage platform, while mPedigree (Ghana) prevents and detects counterfeit medicine, and other products, within supply chains. mPharma’s newest product in Ethiopia is Mutti, a mobile money membership program that offers healthcare financing services to help patients, especially uninsured patients, pay for healthcare costs. Addressing the gap in digital infrastructure are mobile health (mHealth) companies like Zuri Health, whose offerings include SMS-based telehealth services for patients who lack access to the internet. In Uganda, where many patients had previously travelled long distances to reach clinics only to find that the needed medications were unavailable, a mobile health (m-health) system called mTRAC now provides information about medicine stocks in clinics across the country. Innovative fintech companies like MicroEnsure, Jamii Africa, and M-Tiba are bringing affordable health insurance policies to Africans as well, including microinsurance and cellular plan add-ons. GSMA mHealth has brought the mobile and health care industries together by bringing solutions to long-term health problems. Patients can access basic health information through their mobile phones. The main advantage of this technology is that it allows access to people in rural areas where people have been typically neglected. Another upcoming innovation that will be interesting to follow is the CardioPad. The tablet is expected to reduce the rate of cardiovascular disease mortality in countries with a shortage of cardiologists by using a cardio-pad medical tablet to perform cardiac examinations and permit remote readings. The founder of CardioPad has been nominated for a Rolex Award for enterprises. Specific devices utilizing sensors, the Internet of Things, and other 4IR technologies target to facilitate diagnoses of specific health conditions. For example, the Matiscope is a tool created by the Ugandan company Matibabu that fits onto the index finger and, without drawing blood, can detect the presence of malaria-causing parasites. In just a few minutes, the Matiscope determines the results and sends them to a user-friendly smartphone or computer application. Many digital health applications and devices use cloud computing to store and manage data on a network of remote servers. Such is the case with RxAll’s RxScanner, a device that uses AI and cloud computing to rapidly detect counterfeit drugs.
We Don’t have to Always Reinvent the Wheel
As with all the good news, it is not just the technology in itself that leads to its near adoption. It is the novel application of existing technology to specific local needs and limitations. Usually, such breakthroughs are solutions based on the ability of a local innovator to recognize a challenge, develop a deep understanding of its causes and opportunities, study the local landscape, scan the globe for the best practices, and design a creative, implementable approach that is relevant, adaptable and scalable.
Ladies and gentlemen, M-Pesa did not invent banking; M-Kopa did not design solar energy, and Twiga did not create three-wheelers to cut out middlemen by delivering produce directly from smallholder farmers to urban merchants. Instead, these companies and the innovators behind them took advantage of existing technology to develop and adapt business models that provided solutions to local problems.
The Need for Policies and Regulations
Governments and policy think tanks like Digital Africa and other organizations also have an indispensable role to play because sustainable development depends not just on resources or GDP but on a complex orchestration of legal, economic, regulatory and other factors. World Economic Forum highlights 12 pillars of global competitiveness. These include institutions, infrastructure, macroeconomic environment, health, primary education, higher education and training, goods market efficiency, labour market efficiency, financial market development, technology preparedness, market size, and business sophistication and innovation. These areas touch the daily lives of every citizen, family and community.
Positioning Africa in the Global Tech Race
The following key points are considered:
- Education: Government leaders must capture the benefit of our youth dividend by ensuring a modern education for all our young people. African countries should integrate emerging technologies into education more systematically to improve learning outcomes through adaptive and collaborative learning platforms, distance learning, increased availability of learning materials, and dissemination of advanced pedagogies. Education is a direct means to economic development because it creates the foundation of skills and analysis on which technology innovation everywhere in the world is dependent. At the highest end of the education spectrum, we must ensure that our most talented students can enjoy world-class higher education without being forced to seek it overseas. Too many of these young scholars understandably stay after obtaining advanced degrees to make their careers and homes in their adopted country. The only way to reverse the brain drain is to provide comparable professional and personal opportunities for our most talented daughters and sons at home in Africa. Only in this way will they stay in Africa or return home – not out of a sense of duty or sacrifice, or sentiment, or even adventure – but instead because their native country is a rewarding and exciting place to live and work.
- Capacity building: The increased pace of globalization and technological advancement is expanding in Africa. Machines are now doing more jobs, therefore people have to quickly learn new skills to do different jobs. This is where capacity building becomes crucial. The digital capacity of countries is only as effective as its digital infrastructure. It will be an impossible task to accomplish capacity building in Africa if the structures and infrastructures required to facilitate learning are not in place. Whilst human capital is important, Africa needs to invest heavily in its digital infrastructure. Young people should be the most targeted demographic to improve capacity building in the digital era. A reform of curricula and the introduction of courses in entrepreneurship and digital technology would be advantageous for individuals and society in general. The use of innovation hubs, for example, is an engaging approach not only to boost skill acquisition but to promote innovation and creativity in a dynamic and challenging community. By creating a conducive and inclusive ecosystem where they can interact and network, young people are more likely to come together to drive the innovation that is needed in the digital era. African governments are responsible for building technology capacity through the policies and processes that guide investment decisions in IT, innovation capacity, and IT products and services.
- Policy and regulation: African policymakers have made remarkable strides in developing regulatory frameworks for technology in Africa. These policies have helped nourish vibrant tech ecosystems and growing digital economies across many parts of the continent. Some policies are emerging as salient points of interest for African governments and institutions working to define their course within the larger global Tech policy debate and captured as strategic areas within the AU’s Digital Transformation Strategy. The emerging policy areas include Africa’s digital single market, digital taxes, digital rights, data protection and privacy, cybersecurity, fintech regulation, and the digital economy – start-ups and innovation. However, data infrastructure, cloud policy, AI governance and ethics, internet geopolitics and the future of the internet are also fast-evolving policy areas. Meanwhile, these fast-evolving policy areas are not prominently featured within the AU’s Digital Transformation Strategy. If the fast-evolving policy areas are fully considered by African governments and their supporting institutions, then Africa can leapfrog its way into the future of global technology.
- Infrastructure: African countries should make IT infrastructures available. The first step in ensuring the availability of IT infrastructure in Africa is the provision of power. This is because electricity provides enabling environment for IT infrastructure to thrive. Apart from stepping up the game in the provision of electricity, African countries should invest in alternate sources of power, such as solar energy, etc. After putting power infrastructure in place, the governments can now make provisions for national IT Broadband infrastructure, Internet access, reasonable price access to IT, etc. The budgetary allocations for IT infrastructure should increase in Africa. Partnership with local IT technicians, operators, and investors is another viable framework to indigenize IT in Africa. The truth is that those IT companies in Africa know the IT needs and terrains for the continent. There are many mobile network operators in Africa, for instance, MTN, GLO, etc. Partnership with those mobile network operators will help to indigenize IT on the continent. This is because those mobile operators can add plans/tariffs that cater for IT needs of the local populace, even to the most remote areas, since mobile phone network coverage has penetrated the majority of the rural areas in Africa. In Tanzania, for instance, Jamii is a mobile micro-health insurance start-up. Jamii leveraged Vodacom Tanzania’s brand to drive the adoption of its insurance product. The start-up noted that Vodacom’s trusted brand has been instrumental.
- Collaboration at all levels: Collaboration is the process intended to foster sharing that is necessary among involved or affected groups or organisations in order to achieve collective gains or minimise losses. It is promoted by collective goals, mutual understanding, an informal activity, shared resources, and a common vision. Although technological collaboration occurs in many different forms and may reflect different motives, a number of generalizable assumptions underpin it.
The first assumption is the belief that it can lead to positive-sum gains in internal activities—that is, partners together can obtain mutual benefits that they could not achieve independently. These benefits may include increased scale and scope of activities, shared costs and risks, and improved ability to deal with complexity.
The second assumption is the way it helps with environmental uncertainty. Growing competition in global markets, and rapidly changing and emerging technologies mount pressure on firms to exist with and attempt to control these uncertainties. This is believed to be achieved more easily in collaboration than in isolation. The high level of collaborative activities at all levels may lead to the creation of technical standards which is a means of reducing these uncertainties.
However, collaborative IT strategies would be of tremendous benefit to African countries in making significant strides in reducing the digital divide and positioning Africa in the global tech race. The following elements could be helpful in having a successful implementation of projects and collaborative partnerships in Africa:
- Clear top-level sponsorship
- Complete involvement of collaboration partners
- Clearly defined collaboration plan and deliverables
- Practical and stringent monitoring of collaboration implementation performance
- Commitment to adequate resources
- Clear definition of roles and responsibilities
- Adequate technical and collaborative work training
- Clear change management and communication process
- Steering committee that adds value
- Bricolage Centres: Bricolage is a concept that, in many ways, embodies ideas associated with ‘make-do’, ‘do-it-yourself’ and improvisation as methods for manipulating scarce resources through ingenious ways to solve new problems and create fresh opportunities using whatever resources they may have at hand. Having bricolage centres in every district in Africa will resonate with the adoption of a ‘make-do’ attitude and improvisation as response mechanisms in the way we prepare for and manage our technological processes, reduce our reliance on western innovations and unlock African’s creativity. Baker et al. (2003)and Weick (1993) conceptualised bricolage as a process of tinkering and recombining available materials in creative ways. Countries that apply bricolage as a method in the way they operate refuse to be constrained by their resource limitations. Rather, they are always in search of ingenious ways to transcend them. This view resonates with the ideas expressed by Steffens et al. (2010) who expressed similar views stressing that “bricolage includes a refusal to simply accept existing standards and a willingness to experiment”.
Bricolage is essential for African entrepreneurs and small businesses because they constantly operate under resource constraint conditions. Africa will have to use bricolage to resolve issues of resource constraints and develop idiosyncratic relationships with their resource-poor environments. This is the right time to create more bricolage centres across Sub-Saharan Countries in Africa because the vast majority of studies specifically point to entrepreneurial bricolage as essential for firm survival, development and growth (Davidsson et al., 2017; Powell and Baker, 2014; Senyard, 2015). In other words, positioning Africa in the global tech race would require creativity, critical thinking, improvisation and flexibility. Thus, adopting such a mindset underscores the importance of bricolage as a way of life among micro and small enterprises and multi-national enterprises in Africa.
Conclusion
In conclusion, ladies and gentlemen, it all seems like a tall order, but we can do it! Our promising youth bulge will see to it. Moreover, they are showing great enthusiasm for technology and are rapidly accumulating incredible talents in various areas of new technology. There are many activities now taking place across Africa, both from the public and private sectors, to climb the ladders of digital maturity.
We pray for greater interest by our governments, organisations and wealthy entrepreneurs in these laudable epochal endeavours; that would immensely be useful in catapulting Africa to a deserved positi