The ICT sector has proven to be a strong driver of Gross Domestic Product (GDP) growth in nations across the world. From developing countries to developed nations – the ICT sector has played a part in the success of each of these nation’s economies, the advancement of its people’s skill-sets, capabilities and positioning the nations as a place for global firms to move efficiently conduct business.

Over the past decade – ICT has been a major economic driver to boost the social and economic landscape of the African continent. The ICT sector is better positioned to leverage businesses and the continent to some impressive growth of economies. The ICT sector witnessed double digit growth and if this trend continues upwardly – ICT expenditure in Africa could exceed $150 billion by 2016. The ICT expenditure would continue to include computer hardware and software, computer services (computer and network systems integration, data processing services) and communications services (voice and data communications services) and wired and wireless communication equipment. African countries have made positive progress on access to ICT services – however there is still work to be done in terms of ICT readiness. According to the International Telecommunications Union (ITU) Development Index – it indicated that the African region has made slower progress when compared to other regions in the past two years – with roughly half the improvement on an aggregate basis. Access to ICT still remains a huge challenge for most African countries.

ICT have become ubiquitous – as it now plays an important role in transforming people’s lives globally. In Africa – ICT is set to transform many lives on the social and economic level. Africa has witnessed success of ICT initiatives from mobile banking in East Africa to smart apps that are now being used across the entire continent – apps designed to fulfill different purposes and solving diverse issues. Africa has seen tremendous growth in the last decade and a half – ICT growth has been primarily fueled by mobile cellular communications; mobile penetration; affordability and access to mobile telephony; internet access uptake (one in six people are online in Africa); submarine cable have enhanced international connectivity – the continent now has more than 10 terabytes of submarine connectivity around Northern Africa since 2014; 7 terabytes around Eastern Africa and 4 terabytes around Western Africa. These developments in infrastructure and solutions in Africa – signify and represent a renewed confidence and optimism in Africa’s digital future.

A great amount of work still needs to be done though – as of 2014/2015 more than 80% people in Sub-Saharan Africa (SSA) were still offline – deprived access to the incredible knowledge wealth and riches that the internet can bring into their lives and also the ones who have access – it is still vastly expensive with mobile broadband costing 40-60% of average income in SSA.

The digital revolution has brought many private benefits and a look at a day in the life of the internet reveals some interests trends:

• 7 billion Emails sent
• 8 billion YouTube videos watched
• 2 billion Google searches conducted
• 3 billion Gigabyte (GB) of web traffic
• 803 million Tweets
• 186 million Instagram photos
• 152 million Skype calls
• 36 million Amazon purchases

This digital revolutions also has some benefits that economies can  reap from these trends – digital technologies are transforming more businesses (advent of e-commerce); digital technologies are transforming people’s lives – through digital payments/mobile money accounts/mobile remittances (number of mobile accounts worldwide stood at 300 million as of 2014/2015); digital technologies are transforming governments – with the implementation of digital identities in some parts of the world and also digital technologies promoting development on various scales – expanding the information base, lowering information costs and creating information goods.

We might be privy to these trends; however, a significant digital divide still remains as:

• 6 billion people still without Broadband
• 4 billion people still without Internet
• 2 billion people still without Mobile Phones
• 4 billion people still without A Digital Signal

The ICT sector is among the most profitable and successful – has revolutionized the way the world communicates. Through a combination of forward looking government policies and regulatory reforms; international standards; industry innovation and investment in infrastructure and new services – billions of people have been brought in to the information society in a remarkably short period of time.

ICT entrepreneurs, small to medium enterprises (SMEs) and start-ups have a specific role in ensuring economic growth in a more sustainable and inclusive manner – as they continue to be involved in the development and innovative ICT – enabled solutions with a unique potential to make a long lasting impact in national, regional and global economies and also as an important source of new jobs. The fundamental role of ICT innovators and SMEs is also reflected in the outcomes of the World Summit in the Information Society (WSIS) which was supported by the World Telecommunications and Information Society Day (WTISD 2016) which was celebrated on the 17th May 2016 – with a theme aligned to ITU’s work in unlocking the potential of ICT’s for young innovators, entrepreneurs, innovative SMEs, start-ups and technology hubs as key drivers of innovative and practical solutions for catalyzing progress in achieving international development goals – with a focus on SMEs from developing countries.

There is progress in Africa in the advancement of ICT in transforming the economy of the continent. Bringing Rwanda under the spotlight here – as the Global Information Technology Report (GITR) 2015 – ranked Rwanda first globally for government success in ICT promotion to drive social and economic transformation and according to the World Economic Forum (WEF) Report – Rwanda scored 6.2 points out of 7. Overall Rwanda was ranked No 83 out of 143 countries – positioning Rwanda as the first country in the region and the 5th in Africa. Upon the release of the GITR 2015 report – Rwanda’s Minister of Youth and ICT stated that “Rwanda continues to be one of the fastest growing African countries in ICT and there are several avenues for growth for the ICT sector – from e-commerce and e-services; mobile technologies; applications development and automation to becoming a regional centre for the training of top quality ICT professionals and research”. A robust ICT industry creates wealth, jobs and entrepreneurs.

New developments in Rwanda’s ICT scene include KLab, a youth innovation hub; Think, a technology hub in Kigali; Rwanda Media Hub; The Office and YouthConnekt. Also, the new Kigali Innovation City attracted the first Carnegie Mellon University campus in Africa.

Whereas South Africa is ranked No 5 in ICT infrastructure in Africa – after Seychelles, Libya, Mauritius and Algeria, Rwanda’s high performance was boosted by its One-Laptop-Per-Child policy which saw a distribution of more than 200,000 laptops to grade schoolers.

Various ICT initiatives have also leveraged the transformative opportunities presented by this sector in Africa. The initiatives borne by the ICT sector in developing Africa’s digital economy include:

• Connect Africa Initiative: a global partnership mobilizing the human, financial and technical resource needed to bridge major gaps in ICT infrastructure across the continent which saw a pledge of more than $55 billion.
• International Fibre Connectivity: a number of submarine cable backbone projects proposed in recent years with coverage of 70, 000 km coastal line and estimated cost of $6.4 billion (East African Submarine Cable System; SEACOM; The East Africa Marine System TEAMS)
• East African Broadband Network (EABN): implementing an integrated East African Broadband ICT Infrastructure Network – providing cross border connectivity between 5 East Africa Community partner states (Burundi, Kenya, Rwanda, Tanzania, Uganda)
• South Africa Region Backbone – SATA Backhaul: aimed at improving cross border links that would interconnect the SADC member states through optical fibre networks and link them to submarine cable system including the Eastern African Submarine cable System (EASSY).

In conclusion,  ICT’s has the potential to transform businesses and governments in Africa – driving entrepreneurship, innovation and economic growth. ICT has and plays a pivotal role in enhancing African regional trade and integration as well as the need to build a competitive ICT industry to promote job creation, innovation and the export potential of Africa companies. The future looks certainly bright as Africa seizes the opportunities and employ the transformative power of ICT’s to accelerate its development. ICT driven Africa is a continent where its people prosper – where communities connect and flourish – where businesses thrive – where government enable strong and sustainable development. Africa’s ICT is certainly poised for stupendous growth.

By Dipolelo Moime, CEO, Legato Consultancy Ltd.

Follow him on twitter: @DipoleloMoime 

Pan-African Ecobank is partnering with Orange Cameroon to allow the telco’s customers with accounts at the bank to transfer cash between the two services. The two firms are already working together in Mali and plan to introduce the service in four other African countries.

Banks partnering with mobile companies is the latest attempt by financial firms to tap into the continent’s large populace of the “unbanked.”

In sub-Saharan Africa, only a third of adults have access to bank accounts. Compare this to Latin America, another emerging market, the figure stands at 51%, according to the World Bank. There are a lot of people whose money simply never touches the region’s financial systems.

The mobile phone revolution and the rise of mobile money, especially in east Africa with platforms such as M-Pesa, has changed this.

Mobile money is now big business in Africa. Last year, the market generated $656m in revenue and in the next four years this is expected to double to $1.3 billion, analysts say.

Until recently, financial firms ceded this space to telecom companies. But the clear growth of the sector has compelled a re-evaluation. Now banks are not only trying to compete in this space but also offer new products that promise access to banking services to those who up until this point were excluded.

So in Nigeria, for example, GT Bank are getting in business with Etisalat Nigeria, the country’s third biggest mobile operator, to create GTEasySavers, a savings account that can be opened via mobile phones. For the 57% of the country with no access to formal financial services, that’s a small step in the right direction.

And in Kenya, in 2011, only 42% of people had bank accounts. That has risen dramatically, driven by mobile money platforms.

A battle for supremacy

New mobile products coming into the market promise to deepen financial inclusion even further. Equity Bank are introducing Equitel, its telecoms unit, that will allow customers to access credit loans, perform cross border money transfers and send and receive money from other commercial banks, reports Reuters.

Equity is one of the biggest banks in east Africa and since the soft launch of Equitel in October of last year, the service has attracted a millions subscribers. The bank aims to increase that figure to 5 million by year’s end.

And the market is there. Mobile money transfers claim 85% penetrationin Kenya and $23 billion passed through the platforms in 2014 alone, according to Kenya’s central bank–equivalent to 42% of the country’s GDP.

And the dominant player in this space is Safaricom, controlling two-third market share with over 20 million subscribers generating $318 million of revenue. But with the launch of Equitel, powered by its rival Airtel Kenya, Safaricom’s number one status may finally start to get challenged.

“Competition between Equitel (banks) and Safaricom ?(telcos) will benefit end consumers and financial inclusion in general as mobile money has a platform to reach those who are not included,” Martin Warioba, a tech consultant with the World Bank, told Quartz. “As long as pricing is low enough to include the unbanked, mobile money services and healthy competition will benefit consumers and increase financial inclusion.”

With Equitel being free of charge and interoperable across banks and other mobile money services, Equity Bank could challenge Safaricom’s dominance in the market, especially since they charge a fee for the use of M-Pesa.

But the company’s CEO is not worried. “We welcome competition; it is a true indicator of the free and robust operating environment we have in Kenya,” Bob Collymore said in a statement.

Safaricom has its own partnerships, with Commercial Bank of Africa (CBA) providing M-Shwari, a platform whereby people can access banking services such as saving accounts and small loans via their mobile phones. And in March they launched KCB M-Pesa with Kenya Commercial Bank, a mobile phone-based loan repayable platform.

By Omar of Quartz Africa