The African Continental Free Trade Area (AfCFTA) is a potential game-changer for promoting Africa’s inclusive growth and sustainable development. Credit: United Nations Office of the Special Adviser on Africa
By Deodat Maharaj
GEBZE, Türkiye, Dec 11 2024 (IPS)
Africa, the world’s youngest continent is brimming with creativity, talent and innovation. With more than 60% of its population under the age of 25, Africa’s youth are fueling entrepreneurship and job creation across the region.
Over the past five years, the number of businesses and start-ups has grown by 20% with 2021 seeing a record US$2.15 billion in tech investments. There are now more than 1,000 tech hubs across Africa catalysing digital, social and economic transformation and rewriting its development narrative. This is the story of Africa’s future, brimming with optimism.
Despite challenges, sub-Saharan Africa has made remarkable progress towards digital transformation. A World Bank report cited a 115% increase in Internet users between 2016 and 2021 while 191 million additional Africans made or received a digital payment between 2014 and 2021.
Africa’s cities are also the fastest-growing and youngest in the world – and changing rapidly. This urbanisation coupled with The African Continent Free Trade Area (AfCFTA), the world’s largest free trade zone in terms of number of countries, create unparalleled opportunities for development and economic integration, according to the African Development Bank.
Harnessing Africa’s demographic dividend for economic growth
Across the continent, young entrepreneurs are tackling deep-rooted development challenges in sectors from healthcare and education to agriculture and finance:
Rwanda has just launched a HealthTech accelerator hub. This accelerator aims to advance health innovations across Africa to solve some of the continent’s health challenges, particularly in low-income and underserved communities. Etudesk, a Côte d’Ivoire-based Ed-Tech company, is an interactive platform designed to make professional training more accessible.
The platform offers a wide range of online courses in Business, IT, Economics, Civil Engineering, and Sciences. In Uganda, a young woman engineer has designed a backpack with solar-powered torches, so that students are able to study at night.
In Botswana, Brastorne Enterprises connects nearly 5 million underserved Africans across four countries to vital information using a suite of products that deliver internet capabilities to feature phones.
Mobile money platforms are flourishing with Africa hosting nearly half of the world’s mobile banking services and accounts. Zambian fintech company eShandi is on a mission to serve millions of unbanked adults in sub-Saharan Africa by leveraging artificial intelligence and mobile technology to break down traditional banking barriers, such as credit history checks.
It’s recently expanded its services to Kenya, South Africa and Zimbabwe and is a clear example of how technology has enabled communities in developing countries to leapfrog traditional service infrastructure.
As one commentator noted: ‘Banks’ customers don’t need face-to-face contact in Africa because they’ve never had it.’ Money transfer not only benefits individuals – it also benefits business and unlocks new forms of economic growth.
Technology, the enabler
Inclusive technology has the power to transform the lives of Africa’s 1.48 billion citizens and the potential to eradicate poverty. It can help bridge the education divide and expand access to healthcare. It can boost economic growth and foster new employment opportunities. And it can promote greater transparency in governments and improved public sector productivity – all good news for investors.
Yet there are very real barriers to overcome. Less than 40% of Africans have broadband internet access and rural areas are poorly served, while inadequate infrastructure and high data costs restrict connectivity. The global average for internet access stands at 66.2%.
In Least Developed Countries (LDCs) , the average smartphone costs 95 per cent of an average monthly income, making online access inaccessible to most.
The continent also faces a skills gap and gender disparity, with women disproportionately excluded from digital opportunities. The International Finance Centre estimates that some 230 million jobs in Sub-Saharan Africa will need digital skills by 2030. Closing these gaps is not just an opportunity, it’s an imperative for Africa.
Policy and partnerships
If the continent is to capitalize on its youthful entrepreneurship, it needs a policy environment that fosters and quickly delivers digital infrastructure development. It also requires focused investment in education with curricula integrating science, technology, engineering and mathematics and exposure to frontier technologies at an early age.
Partnerships are vital too, including with companies and universities both within the region, and internationally. Centres of excellence, which link academia and business also have an important role in promoting local solutions and creating that vital link between research and industry.
There are excellent best practices in Africa and in the Global South, so it is about time they start connecting and collaborating on a systematic basis. Of course, establishing and deepening partnerships with Centres of Excellence in the developed world will continue to be important.
Achieving these goals call for scaled up financing and collective effort from governments and development partners with business playing a vital role. Support to young entrepreneurs in the tech sector must be accorded a high priority since they have already demonstrated that even with the deck stacked against them, they can deliver innovation, creating jobs and opportunities for the continent.
Looking ahead, policy makers have a clear choice. Either it is business as usual or create the environment with incentives to let youth and innovation deliver on the promise of Rising Africa.
Deodat Maharaj is the Managing Director, United Nations Technology Bank for the Least Developed Countries and can be reached at: deodat.maharaj@un.org
IPS UN Bureau
