Africa’s digital transformation: bridging the gap between potential and progress

By Jean Baptiste Ndabananiye

Africa’s digital transformation journey, despite attempting to progress rapidly in some areas, still lags behind the advanced world in several key aspects of this field. The comparison between Africa and more developed regions such as North America, Europe, and parts of Asia underscores both the challenges and opportunities unique to the continent. Different sources argue that digital transformation possesses the potential to reverse the trend of jobless growth in Africa and change the structure of African economies, by creating new job opportunities, enhancing productivity, and enabling economic diversification.

However, for this potential to materialize, these sources say that it necessitates investment in digital infrastructure, education, and policy frameworks that support innovation and inclusion. They highlight that this transformation can alter the structure of African economies, shifting them from relying heavily on agriculture and raw materials to more diversified and knowledge-based economies. Africa shows positive progress, with countries like Morocco and Libya carrying very high internet access rates of 90.7% and 88.4%, respectively. Globally, Northern Europe leads with 97.5% internet access, followed by North America with 96.9%. These percentages represent the proportion of the population in each region that enjoys internet access. This article addresses these subjects:

1. Explanation of digital transformation and internet penetration
2. Details on digital transformation role in reversing jobless growth
3. Some success stories in Africa

Explanation of digital transformation and internet penetration

Digital transformation constitutes the process by which organizations integrate digital technology into all aspects of their operations, fundamentally changing how they operate and deliver value to customers. It involves a cultural shift that encourages organizations to continuously challenge the status quo, experiment, and adapt to new technologies and methodologies.

Digital transformation includes the adoption and integration of digital technologies. The latter ones such as artificial intelligence and internet of things are driving gargantuan transformation across different aspects of organizations and industries.

The World Bank Group in its February 29, 2024 report says “Digital technologies are ushering in a new era in development—by transforming economies, creating jobs, and improving the lives of even the most vulnerable and remote populations.

They have dramatically changed the way we communicate with each other, how we conduct business, and our interaction with the environment. The international community has an unprecedented opportunity to help developing countries reap the benefits of digitalization while mitigating the risks and ensuring that, working together, through accelerated investments and policy reforms, we can close the digital divide.”

 This bank adds that embracing digitalization is no longer a choice, but instead a necessity. “The critical services that support development—like hospitals, schools, energy infrastructure, and agriculture—all run on connectivity and data.

Without access to the internet and the skills to use digital technologies effectively, too many, unfortunately, are essentially locked out of the modern world. A new digital era that is accessible to all holds the potential to shape a more inclusive, resilient, and sustainable world for generations to come.”

For the developed world to register gigantic achievements in this sphere, it has first taken certain actions. Those include infrastructure and connectivity, technology adoption, education and digital skills, innovation and entrepreneurship, economic integration, consumer adoption and e-commerce, investment and funding, and digital inclusion.

Though Africa is accomplishing strides in digital transformation, chiefly in mobile and financial technologies, it still lags behind the advanced world in those mentioned areas.

For instance, in the developed world occur high levels of internet penetration, widespread broadband access, and advanced telecommunications infrastructure. Though mobile penetration is high in Africa, with mobile phones being the primary means of internet access, broadband infrastructure is limited. Internet access is vital for several digital technologies, since they cannot be established and developed without it.

Statista- a German platform which is recognized as a leading online statistics portal providing access to statistics, reports, forecasts, and studies on a wide range of topics- conducted a worldwide survey in July 2024 and published the report on August 13, 2024.

The report reads “As of July 2024, Northern Europe ranked first by the internet penetration rate, with over 97.5 percent of its population using the internet. Northern America followed, with 96.9 percent. Overall, the global average internet penetration rate was roughly 67.1 percent. 

The ongoing development of telecommunication networks and infrastructure has directly impacted internet penetration on a global scale. Thanks to advancing mobile technology and the continuous modernization of previously less-developed regions, the number of internet users worldwide has been on the rise in recent years, reaching 5.3 billion as of October 2023. In the world-wide-web, Google’s Chrome still holds the largest market share for internet browsers, roughly 62.82 percent of the total market as of May 2023, followed by Apple’s Safari at nearly 21 percent.”

This report states that Asia bears the most extensive internet user base, with more than an estimated 2.9 billion internet users in this region alone and East Asia occupying most of this share. Statista has nevertheless observed a certain discrepancy in this region. “Despite this region’s large volume of internet users, Asia is far from being a leader regarding online penetration. Eastern Asia, for instance, had an online penetration rate of 75.3 percent as of April 2023.” Online penetration simply refers to the percentage of people in a specific area or group who employ the internet. For example, if an area consists of 100 people and 80 of them use the internet, the online penetration rate is 80%.

The report indicates that 75.9% of Southern Africa’s population holds internet access, compared to 70.1% in Northern Africa, 42.3% in Western Africa, 32.2% in Middle Africa, 26.8% in Eastern Africa, 94.5% in Western Europe, 90.2% in Southern Europe, 88.4% in Eastern Europe, 82.6% in Southern America, 78.4% in Central America, 77.7% in Eastern Asia, 77.4% in Oceania, 76.5% in Central Asia, 75.3% in Western Asia, 74% South-Eastern Asia and 70.1% in the Caribbean Region.

According to a survey also performed by Statista in Africa in January 2024 and whose reported published in March 2024, Morocco, Libya and Seychelles have achieved an outstanding level in internet penetration. It reads “As of January 2024, Morocco had an internet penetration of approximately 91 percent, making it the country with the highest internet penetration in Africa. Libya ranked second, with around 88 percent, followed by Seychelles with roughly 87 percent. On the other hand, South Sudan (12.1%), Burundi (11.3%), and the Central African Republic (10.6%)had the lowest prevalence of internet among their population.”

Other leading nations in this field in Africa include Tunisia (79.6%), Botswana (77.3%), Mauritius (75.5%), South Africa (74.7%), Gabon (73.7%), Algeria (72.9%), Egypt (72.2%), and Cabo Verde (72.1%). Internet penetration in other African countries ranges between 69.8% in Ghana and 16.9% in Niger.

The advanced world boasts elevated levels of investment in technology, both in private and public sectors. Advanced economies enjoy well-established venture capital ecosystems and government support for research and development. Investment in digital transformation in Africa is increasing, with growing interest from both local and international investors. Notwithstanding, the scale of funding remains much smaller, and numerous startups struggle to secure capital. Government investment in research and development also stands lower, compared to advanced economies.

For Africa to expedite its digital transformation and close the gap with more advanced economies, potentially unlocking significant economic and social benefits, it needs to ensure continued investment and policy support, among others.

Details on digital transformation role in reversing jobless growth

Citing a “new report” which, Life In Humanity found was released in 2019; the World Economic Forum with its Jan 9, 2024 article points out that 100 million Africans could be unemployed. According to Statista’s 27 May 2024 article, around 36 million people are unemployed in Africa as of 2024 from 28.65 million ones in 2014. The discrepancy in the two pieces of information can be rationalized by the time when these data were collected and released.

A report published by the World Bank Group on 13 March 2023 says “Generating good jobs is essential for the more than 22 million Africans joining the workforce each year. Digital technologies, from computers to apps to machine learning, offer new opportunities for people, businesses, and jobs.

Evidence presented in this report demonstrates that internet availability increases jobs and reduced poverty in African countries. To fully realize their potential, digital technologies need to become more affordable and easier to use. Governments should prioritize policies and investments that increase internet coverage, foster productive internet use, and enhance skills, jobs, and earnings.”

Energy for Growth Hub echoes it, yet still raises an issue necessitating attention in Africa in these words “By 2100, Africa’s working age population is projected to triple, rising to over 2.5 billion — and the number of Africans entering the workforce each year will exceed the rest of the world combined. This demographic boom could be a dynamic source of young, talented, tech-savvy workers to innovate and drive economic growth — if they can find jobs. Otherwise, the coming surge in Africa’s working-age population could be an immense burden and source of growing instability for the continent’s struggling economies.”

Energy for Growth Hub points out that job creation represents an urgent priority for all African economies. “Expanding the use of digital technologies (for example: smartphones, tablets, internet-enabled productivity-enhancing solutions in management, financing, training, etc.) creates jobs, boosts productivity, and raises incomes.

But while mobile internet coverage has expanded rapidly across Africa, actual usage of digital tools remains quite low. The lack of reliable electricity is one big reason why, among others. Efforts to expand digitalization should be integrated with support to strengthen and expand the power system (and vice versa). The future of work depends on it.”

The Digital Transformation Strategy for Africa (2020-2030) also underlines that this area of digital transformation constitutes a cornerstone for Africa’s development in all the continent’s sectors. “Africa presents a sea of economic opportunities in virtually every sector, and the continent’s youthful population structure is an enormous opportunity in this digital era and hence the need for Africa to make digitally enabled socio-economic development a high priority. Digital Transformation is a driving force for innovative, inclusive and sustainable growth.

Innovations and digitalization are stimulating job creation and contributing to addressing poverty, reducing inequality, facilitating the delivery of goods and services, and contributing to the achievement of Agenda 2063 and the Sustainable Development Goals.”

Agenda 2063 is a strategic framework developed by the African Union, aiming to guide Africa’s development over a 50-year period, from 2013 to 2063. It envisions a prosperous, integrated, and peaceful Africa driven by its own citizens and representing a dynamic force in the global arena.

In the meantime, it is estimated that within the next 10 years, 9/10 jobs worldwide will demand digital skills. Digital skills refer to abilities and knowledge required to effectively use digital technologies and tools. These skills are crucial for navigating the modern digital landscape which encompasses everything from basic computer operations to advanced data analysis such as internet navigation, email communication, word processing, spreadsheet management, presentation tools, online research, digital marketing, graphic and artificial intelligence.

In its 09 October 2020 article, the African Development Group says that digitalization forms the foundation of Fourth Industrial Revolution technologies like big data, the Internet of Things, 3D printing, artificial intelligence, cloud computing, and advanced materials, among others. “It has become very clear that the combination of the Covid-19 pandemic and the need to catch up with digital transformation is creating the foundation for tectonic shifts in how business is conducted. This is not just in Africa, but globally.

This revolution will determine the economic winners of the future. Africa cannot afford to be left behind if African countries hope to advance their industrialization and development agendas as this industrial revolution cuts across the entire production value chain.”

There exist different fields in which people can create jobs, owing to digitalization. Digital content creation constitutes one of these fields. The rise of digital platforms has generated opportunities for content creators including bloggers, vloggers, podcasters, and influencers who create content for social media, streaming platforms, and other online channels. The digital channels have created the demand for visually appealing digital content that has, in turn, resulted in job growth in graphic design, video production, animation, and other multimedia fields.

Some success stories in Africa

You can rarely find an African country which does not have people engaged in digital technologies. The advanced world forms a home to major tech hubs like Silicon Valley, in the USA, with robust ecosystems supporting innovation, including venture capital, incubators, and a strong legal framework for intellectual property protection. However in Africa, tech hubs are also emerging in cities like Nairobi, Lagos, and Cape Town, fostering innovation, especially in financial technology, health technology, and agricultural technology. Although investment levels, availability of venture capital, and support for startups are still limited compared to advanced economies, these African hubs constitute a positive sign of progress.

International Finance Corporation (IFC) in its May 2024 article headlined “Going Digital: Five Young People Leading Malawi’s Tech Transformation” says “ Meet Wangiwe, Sithembile, Kelvin, Daniel and Bright. These five young people are pillars in Malawi’s growing tech community who are connected to the digital world to a degree that no generation before could have imagined.

Shaped by the internet and mobile phones, they are utilizing technology to help build brighter, more prosperous futures, not just for themselves but for millions of other young people across Malawi.”

Digital Opportunities in African Businesses,a new IFC report shows how Africa’s digital startup ecosystem is still “nascent but stands out as one of the fastest growing worldwide, underscored by a sevenfold increase in deals between 2015 and 2022.” “While 60 percent of tech firms in Africa are less than 10 years old, as in other regions, younger tech firms are more disruptive than their old peers.”

This report suggests policies to help tech entrepreneurs formulate and adapt or adjust digital technologies to the local operating context, in order to attract top talent and foster entrepreneurship.

Wangiwe Kambuzi is founder and managing director of Mzuzu E-Hub. IFC says that this hub forms a vibrant business development support service in Mzuzu, Northern Malawi, which assists young entrepreneurs to find their footing in incubating and opening a business. “Now, having helped more than 430 emerging entrepreneurs, Kambuzi has unleased the potential of a community of new business leaders,” states the corporation.

The IFC adds that one major pillar of Mzuzu E-Hub’s mission is to facilitate technological and digital integration. The latter one is “critical in a country with high rates of unemployed youth.” “We find that many young people are waiting for someone to come and solve their problems. They don’t have access to diverse opportunities and skills that can actually give them something to do,” says Kambuzi noting that her company has already reached some 5000 clients in the local community. “That is why we are here.”

The IFC says that tailoring Mzuzu E-Hub’s mission to the local Malawian context has fulfilled a critical role in the group’s success. Kambuzi says “It is important not to have people bring solutions from elsewhere to Malawi. Rather, they should be homegrown, scaled and then sustained to become solutions that are helping all of us.”

Mzuzu E-Hub is a business incubator, buttressing startup businesses and entrepreneurs by furnishing them with essential resources and services to help them grow and succeed. It says “We believe that small business growth will create sustainable incomes and foster a healthy and diverse entrepreneurial environment in Malawi. Mzuzu E-Hub exists to provide the capacity building, linkages, and networks required to amplify startup and early-stage businesses for growth and success.”

This social enterprise, Mzuzu E-Hub, specifically implements various interventions for its customers. The interventions, among others, include mentorship and training, networking between entrepreneurs with industry experts and potential investors, and facilitating access to funding for startup businesses by helping them to connect with potential funding sources and investors, and marketing assistance.

To be informed about the other four young Malawians, you can read the IFC article.