By Yinka Adegoke,
Sources: Culled from Quartz Africa
The internet is a good thing for Africa. But it could be an even better thing.
That seems to be the subtext of an Internet Society report, out this month, titled Promoting the African Internet Economy.
The economic case for the internet in Africa is unsurprisingly strong, but the report points out there’s still plenty of room for improvement and growth. In developed countries, the internet contributes up to 3.7% of GDP on average while in Africa countries it’s just 1.1%. When it comes to employment the internet sector makes up 3% to 5% of the workforce in OECD countries but only 1% in developing countries.
Internet Society says a focus on building the internet sector, “while critical for development, will have a beneficial, but an ultimately limited impact on the size of the economy, in and of itself.”
The point is not that more internet directly leads to a bigger economy. Instead, the report argues the improved efficiencies for an Internet-enabled economy—particularly one in Africa—can be significant. Looking at six key sectors: education, healthcare, financial services, agriculture, retail and government, McKinsey estimated the internet can deliver productivity gains in Africa valued between $148 billion to $318 billion by 2025.
For African governments, many of which are still pen and paper pushers in their day-to-day interactions with citizens, there could be cost savings of 60% to 75% just on administrative tasks. Mauritius, Tunisia and South Africa are already leading on that (pdf).
The lack of local content infrastructure, such as data centers, routers, servers and content delivery networks (CDNs) is one of the key challenges Internet Society identifies as being needed to drive wider and deeper internet usage in African countries.
It’s one thing for a local blogger to create original content that people want to see, but it’s quite another for the content to get served up to someone in the same country in a rapid and seamless fashion. That often doesn’t happen because that story or image or transaction is being routed halfway across the world through internet exchanges in Europe or North America before being delivered to your reader, friend or relative who only lives a few doors down the road from you.
This doesn’t just mean internet delivery is a slower and more unreliable experience than elsewhere but also ends up making it a more expensive and discouraging experience. Fixing that problem would a be a big step in the right direction.
About the Author:
— Yinka Adegoke is Quartz Africa editor