Digital Trade for Africa’s Prosperity

Summary

This webinar, organized by Diplo Foundation, focused on digital trade and its potential for Africa’s prosperity. Panelists discussed various aspects of digital trade, including e-commerce, policy frameworks, infrastructure challenges, and financial services. Key points included the need for improved internet connectivity, especially in rural areas, and the importance of developing robust data protection and cybersecurity laws across the continent. The discussion highlighted the potential of mobile money services, like M-Pesa in Kenya, in facilitating digital transactions and financial inclusion.

Panelists emphasized the importance of adapting global digital trade practices to suit African contexts and needs. They discussed the challenges of last-mile delivery and the role of postal services in bridging this gap. The African Continental Free Trade Area Agreement was highlighted as a crucial framework for harmonizing digital trade policies across the continent. The need for digital literacy programs and capacity building, especially for youth and women, was stressed as essential for leveraging Africa’s demographic dividend in the digital economy.

The discussion also touched on data management challenges, the potential of emerging technologies like AI and blockchain, and the importance of cross-border cooperation in enforcing quality standards for digital trade. Panelists agreed on the need for public-private partnerships and incentives to encourage small and medium enterprises to digitize their services. The webinar concluded with calls for prioritizing infrastructure development, regulatory harmonization, and consumer empowerment to create a prosperous and secure digital trade environment across Africa.

Keypoints

Major discussion points:

– The potential and challenges of digital trade and e-commerce in Africa

– The need for improved infrastructure, both physical and digital, to support digital trade

– The importance of appropriate legal and regulatory frameworks for digital trade and financial transactions

– The role of data collection and management in supporting digital trade

– Strategies for adapting postal and logistics services for e-commerce

Overall purpose:

The goal of this discussion was to explore the opportunities and challenges of digital trade in Africa, and to identify priority areas for action to promote a prosperous and secure digital trade environment across the continent.

Tone:

The tone of the discussion was largely optimistic and forward-looking, with panelists highlighting the significant potential of digital trade for Africa’s economic growth. At the same time, there was a pragmatic acknowledgment of the challenges and barriers that need to be overcome. The tone remained consistent throughout, balancing enthusiasm for the opportunities with a realistic assessment of the work needed to realize them.

Speakers

– Christine Mwarenge – Postal Corporation of Kenya

– Gertrude Bandari – Business Planning Lead at Financial Services (M-Pesa), Safaricom

– Humphrey Njogu – Researcher at Kenya Institute of Policy Research, Nairobi

– Ingrid Serwah Asare – Legal and Compliance Division, Ghana’s Cyber Security Authority

– Katherine Getao – Moderator

– Kholofelo Kugler – PhD candidate (soon to be doctor), expertise in e-commerce

– Mwende Njiraini – Organizer from Diplo Foundation

Additional speakers:

– Alvin – Technical support

Digital Trade in Africa: Challenges and Opportunities for Prosperity

This webinar, organised by Diplo Foundation in late 2024, brought together experts from various sectors to discuss the potential of digital trade for Africa’s economic growth and the challenges that need to be addressed to realise this potential. The panel, moderated by Katherine Getao, included representatives from postal services, financial technology, policy research, cybersecurity, and academia.

Economic Potential and Current Landscape

Kholofelo Kugler, a PhD candidate with expertise in e-commerce, set the stage by highlighting the significant economic potential of digital trade in Africa. She cited estimates from the IFC and Google projecting that Africa’s digital economy could reach up to $180 billion by 2025, accounting for 8.5% of the continent’s GDP. The panellists agreed that Africa’s young population and rising mobile adoption present significant opportunities for digital trade growth.

Key Challenges

1. Infrastructure Deficits

Christine Mwarenge from the Postal Corporation of Kenya emphasised that infrastructure deficits, both physical and digital, hinder the growth of digital trade, particularly in rural areas.

2. Data Management and Collection

Humphrey Njogu, a researcher at the Kenya Institute of Policy Research, highlighted the issue of data deficits and inaccurate statistics, which impede decision-making in the digital trade sector.

3. Regulatory Frameworks

Ingrid Serwah Asare from Ghana’s Cyber Security Authority and Kholofelo Kugler stressed the importance of developing robust legal and regulatory frameworks for digital trade. Kugler pointed out that only 61% of African countries have data protection laws, and only 72% have cybersecurity laws.

Opportunities and Innovations

1. Mobile Money and Financial Services

Gertrude Bandari from Safaricom’s M-Pesa division discussed how mobile money platforms are enabling financial access and transactions across Africa. She highlighted M-Pesa’s features like the Fuliza overdraft service and plans for buy-now-pay-later options. Bandari also mentioned partnerships with remittance providers that enable international transfers.

2. Adapting Postal Services for E-commerce

Christine Mwarenge described how postal services are adapting to support e-commerce, including developing mobile apps for tracking deliveries and flexible delivery options. She emphasised the need for national addressing systems to improve deliveries and mentioned partnerships with the government to develop such systems.

3. Leveraging Technology for Data and Security

Humphrey Njogu and Gertrude Bandari both highlighted the role of technology in improving data collection and ensuring the security and reliability of digital platforms.

Policy Frameworks and Regulations

Ingrid Serwah Asare emphasised the importance of the African Continental Free Trade Area Agreement in harmonising digital trade policies across the continent. She also discussed the Malabo Convention, which provides a framework for cybersecurity and personal data protection in Africa. The speakers agreed that implementing these agreements should be a priority to create a cohesive regulatory environment for digital trade.

Key Recommendations and Action Items

1. Implement the African Continental Free Trade Area Agreement and Malabo Convention.

2. Prioritise cybersecurity and platform reliability to build trust in digital systems.

3. Analyse the digital trade ecosystem to inform targeted regulation that suits African contexts.

4. Provide incentives for SMEs to digitise their services and products.

5. Develop national addressing systems to improve last-mile delivery for e-commerce.

6. Invest in infrastructure, especially in underserved rural areas.

7. Modernise data management systems for more accurate decision-making.

8. Develop consumer empowerment programs to increase digital literacy and awareness.

9. Explore the potential of social media marketing and African-owned platforms.

Unresolved Issues and Future Considerations

1. Effective regulation of cryptocurrencies and digital currencies across Africa.

2. Addressing the high cost of internet access in many African countries.

3. Harmonising cross-border financial regulations to enable seamless transactions.

4. Developing continent-wide standards for data protection and cybersecurity.

5. Bridging the digital literacy gap, especially among older populations.

Conclusion

The webinar highlighted the immense potential of digital trade for Africa’s economic growth while acknowledging the significant challenges that need to be addressed. The speakers emphasised the importance of developing Africa-specific solutions rather than simply adopting global practices. As Kholofelo Kugler aptly stated, “We cannot copy and paste what everybody’s doing around the world because we’re not everybody around the world, we are Africans.”

Moving forward, the panellists agreed that a multi-stakeholder approach involving governments, private sector entities, and civil society will be crucial in creating a prosperous and secure digital trade environment across Africa. By addressing infrastructure gaps, improving regulatory frameworks, and leveraging technological innovations, Africa can position itself to fully harness the benefits of the digital economy in the coming years.

Mwende Njiraini: I hope you can hear me. We are set to begin right away. I want to welcome all of you today to this webinar that has been organized by Diplo Foundation. Diplo is an international non-governmental, non-profit organization established by the governments of Malta and Switzerland. We have several offices around the world. One in Geneva, one in Belgrade, one in Washington, D.C. And most recently set up the one in Africa, in Nairobi, Kenya. We are grateful that you are able to join us this afternoon for this very exciting topic that we are going to discuss on trade and for Africa’s prosperity. We recognize that technology is affecting or impacting all areas of our lives. and because of that we are looking for ways to enhance or embrace the use of technology in all areas of our lives. So in this webinar we are going to cover various topics on digital trade and we are going to talk about policy and agreements that African countries have entered into including the African continent of free trade area agreement that is in force right now I believe but the panelists will brief us and give us an overview of how or where the African free trade area has reached. We are also going to discuss market access and trade barriers that impact trade between countries within the continent. We’re also going to discuss economic development through trade and I recognize that it’s actually a fact that there is economic development that is enhanced through trade within the continent and out of the continent. So also we’re going to look at the logistics and the infrastructure and we have here Postal Corporation of Kenya who is going to help us just decipher what is required for us as a continent in terms of logistics and infrastructure to support cross-border trade. Then of course we’ll discuss digital trade and e-commerce and how digital trade is evolving in Africa and what are the opportunities and challenges that we face. And then also we’re going to talk about economic zones, including ECOWAS, SADAC, YACO, and many other trade blocs, even including Commercia, that have been set up to enhance. Just a brief of what we are going to cover today, and we’re going to invite, I hope you’ve joined, Dr. Kate Getao, can you hear us?

Katherine Getao: Yes, I can hear you.

Mwende Njiraini: Fantastic. Welcome, just to the session. You’re going to help us in the next session where we will be looking at Africa trade in various ways, and how that is impacting regional cooperation in Africa. So, Dr. Kate Getao, you’re welcome.

Katherine Getao: Okay, thank you, and it’s a great pleasure and a privilege to meet you all once again in this last quarter of 2024. And as Mwende has explained, we decided to focus on digital trade, which we believe is an area of great potential for our continent. So, without much further ado, we have five very distinguished panelists, and I’m sure you’re eager to hear from them. So, we’ll have Dr. Kholofelo Kugler, covering mainly issues of e-commerce. Dr. Humphrey Njogu, who is a researcher at the Kenya Institute of Policy Research in Nairobi, Kenya, covering issues of cybersecurity and legal issues. Ingrid from the Cyber Security Agency of Ghana Then for financial services, we are happy to have Gertrude from Safaricom, which you know is the famous purveyor of mobile money And finally, representing the postal corporation, we have Christine Mwarenge Now, because we have a lot to cover, I’ll just do the first question And as you answer the question, please introduce yourself briefly, maybe tell us your role, your name, of course, and your role in your workplace And then you can just tell us a little bit about this question, which is that digital trade holds tremendous potential for Africa’s growth With e-commerce as a driving force in this movement towards digital trade From your unique perspective, what do you see as the most pressing challenge and the greatest opportunity for advancing digital trade within the continent of Africa? So we’ll start with Dr. Kholofelo, and then we’ll go around. I’ll mention the name as we start

Kholofelo Kugler: Hello, good afternoon. Can you hear me?

Katherine Getao: Yes, we can. We can hear you very well. Welcome

Kholofelo Kugler: Thank you. Thank you very much for your invitation I just want to clarify that I’m not yet a doctor I’m at the very end of my PhD, which will be conferred soon So I’m soon to be a doctor But I mean, as you all know, the digital economy holds a lot of promise for Africa I’ll just add a few stats and highlight some of the most pressing challenges and probably the greatest opportunities that we may reap as Africans Already in 2020, the IFC and Google estimated that Africa’s digital economy could reach up to $180 billion by 2020 That’s next year, and account for 5.2% of the continent’s GDP By 2025, it was projected that potential contribution could reach $172 billion, or about 8.5% of GDP And one of the issues that we have, which I will also address in my pressing challenges is if African internet penetration rates could increase to those of the Global North in Europe, the US, Japan, etc. An additional 140 million jobs could be added to Africa’s GDP So this is huge, huge potential on a continent that faces in some countries, like my own South Africa, up to 40% of unemployment Most of that being youth unemployment, in fact, 60% youth unemployment in South Africa So what do I conceive to be the most pressing challenges? I think for me, it’s infrastructure And I always like to divide infrastructure into the digital or the physical infrastructure and also regulatory infrastructure So obviously, we still have limited internet penetration rates, especially in rural areas We still are facing unreliable power supply Of course, we need reliable energy in order for the digital economy to bloom We’re still facing, in this continent, the challenges that we face The highest data costs, which will not assist in trying to reap the benefits of the digital economy. And also, we still very much have a last-mile delivery infrastructure, which I will actually talk about when I speak more about the e-commerce side. The regulatory infrastructure that we face is that we have insufficient data protection laws. Only 61% of African countries have those. We have insufficient cybersecurity laws. Only 72% of African countries have those, about 39 of them. And also, we have insufficient consumer protection laws that apply to online transactions. And as you know, without this trust environment, it would be very difficult for anybody to even go online, not knowing that their rights and, obviously, their money is protected online. Obviously, for us as Africa, some of the things that we have really at our fingertips is the mobile and e-mobile and the mobile revolution that we’ve seen in Africa. I’m very much looking forward to hearing about this from my colleague from Safaricom. But we’ve sort of leapfrogged the landline revolution, right? We’ve already got mobile phones in our hands. You know, about 80% of Africans have got access to some sort of mobile device, which I think we should be using and thinking about how do we then grow the digital economy from, literally, from our fingertips. We have a young, savvy population. We have a rising mobile money adaptation rate, e-money adaptation rate. And also, we should not forget that in about 2075, one-third of the global workforce is going to be African. That’s 66% African and young. And so, how do we use that? How do we upskill the youth? How do we upskill women to be able to take advantage of those additional services that we can export to other countries in the world? I’ll leave it there. Thank you.

Katherine Getao: Thank you so much, Kholofelo, and we’re really looking forward to having your PhD under the belt. So I believe our address was prophetic. So now, taking on to those very provocative statistics which have come from Kholofelo, I certainly did not know that by 2025, 66% of the global workforce would consist of young Africans. That’s a very exciting statistic, but also a very daunting one.

Kholofelo Kugler: I just want to make a correction. 2075, 33%. So it’s not quite as high, it’s not quite as soon, but still very high.

Katherine Getao: Oh, 33% by 2075. Okay.

Kholofelo Kugler: Yes.

Katherine Getao: Yes, it’s still a huge percentage because certainly we are not 33% of the world’s population. So it’s still quite something. So thank you for the statistics and for that very rousing start. I will turn to Humphrey with the same question, the potential of digital trades for Africa’s growth and the challenges and opportunities that you see from your point of view. Humphrey, are you with us?

Humphrey Njogu: Yes, thank you very much, Dr. Kitt. And good afternoon, everyone. I think for me, I see digital trade as a very critical way of addressing the challenges that we have actually had with the traditional trade. Thank you. If you look at what a doctor or there would be a doctor, my fellow panelists, you notice that there is a lot of potential in this. And this is telling us that there is something that has to do or the potential that has to do with the digital trade. I’ve been following the discussion of the digital trade for some time. You realize that a lot of countries, African countries, there is something that they’re doing towards either coming up with a policy or a legal framework to support a digital trade. So I think this is something that has actually attracted the attention of the policymakers. And I know one of the things that maybe perhaps they so agree with my fellow panelists is that sometimes, even if we want to do the estimates, I think if there is anything that I think we are facing as a continent, is the accuracy of the data. So today, you find that this company, and I just want to pick an example of the IFC, they did a study of the potential of Africa in terms of the digital trade and the digital economy. They’ve given a figure. So recently, I’ve also seen a number of institutions have also carried out studies. So you find that there is a lot of differences in terms of the potential and the estimates of the digital trade. So for me, I think this is an area that I think, one, we haven’t been able to understand it clearly. And of course, this has to do with the level of preparedness that we are in as a continent. Now, there’s a lot of potential in it. We have a whole set of new jobs that we have started creating. So it’s a new way of looking at how we can be able to revolutionize how we do things. But when we look at the key challenges that we are facing as a continent, one, I would say that when it comes to the last mile delivery, that has always been the biggest challenge. We started seeing a number of companies having digital presence with their products and services. But when it comes to delivering these products and services to the end consumer, we find there is a very big disconnect. Yes, we have these big companies that have set up shops in urban areas. But what about the little person who wants to have their own home? I want to order something online on a website. So for me not to be able to get that product that I have just ordered, your guess is as mine that that product may take a lot of time for that product to reach you, or you may not be able to get that product. So I think there is a very big disconnect between how we are delivering the product and the services to the end consumer. And this has to do, one, we haven’t invested quite a lot in terms of our last mile connectivity in terms of roads. There are so many areas that we see, especially in rural areas, that are not well connected with roads. Similarly, also when it comes to something that is very patient that you have ordered, so you may need to have quicker ways of delivering that, and that’s air transport. So you find that very few towns and urban areas in the world have that. in Africa are connected to this kind of infrastructure. So you find that that product may not actually be able to reach to the end consumer or the customer who has actually requested for it. So there is a lot of challenges in terms of delivering that product and services to the end consumer who has actually requested for that product. Again, we also find that even in terms of even internet again. So yes, I can be able to order something online. But again, also, you find that because of the internet is so expensive. So when it comes to tracking of where my product is, I find that I’m not able actually to track where my product is. And therefore, I might actually lose my product. So I think there’s a lot of challenges in terms of delivering the end product or the product that the customers have requested and ensuring that this product is actually reaching to the end consumer. So I think this is one of the main challenges that I find in this space. But of course, there are also other challenges. I also find that also concern to the space. One, you find that…

Katherine Getao: Sorry, Humphrey, I’m interrupting you because, you know, we have quite a few panelists. So you’ve made two very good points regarding the last mile, and also about the policy and the legal frameworks. So I’ll give you another chance later. But for now, I really want to do the round. So I hope you’ll forgive me for that. So given, you’ll give me a bit of latitude. And Humphrey has brought us to the issue of legal. And so I’d like to turn to Ingrid. I’m trusting that you’re with us because that is one area that has been referred to both by Humphrey and by Kholofelo. What do you see as the smart legal provisions that are needed to protect Africans using e-commerce services within and across the continent? And are there specific gaps in current policies that leave e-commerce traders exposed? And how might we address these vulnerabilities to foster a safer digital trading environment? Please go ahead, Ingrid.

Ingrid Serwah Asare: Okay, good afternoon, everyone. I’m Ingrid, and I’m with the Legal and Compliance Division of Ghana’s Cyber Security Authority, and thank you for having me. So with respect to the discussions that we’ve had, what we’re having with them about digital trade, the potentials in Africa, the challenges also, the regulatory framework around these issues are also important. There’s the need for us to have robust and harmonized legal provisions that address electronic transactions in themselves. So for instance, the rules, the laws that will govern delivery, for instance, one of the panelists was talking about actually getting your product, or if there’s a breach with regards to the transaction itself, the commercial transaction, or even regulatory regimes around secure payment systems across borders, having interoperable systems that are secure across borders. There’s the need also for the protection of So consumer rights, but basically consumer protection rights, what happens in terms of refund policies if, you know, if even the product that’s got to you was not the best thing or the ideal thing. And then also we talk about cybercrime laws as well, again with digitalization, there is the incidental, unfortunate incidental risk of being prone to various cyber threats or attacks by various actors. And even as digitalization, we’re improving in that regard, the criminal actors are also being more sophisticated with their attacks and their threats to cybercrime, cybersecurity regulation around the space in terms of cybersecurity. And then, of course, also data governance rules or policies as well. So we would, in line with this, you would have the, you know, there’s a legal framework that’s the the African Convention on Free Trade Area Agreement, which is aimed at harmonizing some of these legal regimes that exist across the continent. And also it’s supposed to, particularly if you look at the digital trade policy, supposed to foster or boost e-commerce across the country. And then, of course, in terms of, we have the Malibu Convention, which is also supposed to ensure that in terms of cybersecurity provisions, we are implementing it across the continent for our online safety as well. So with respect to that, that’s what I’ll say for now. Thank you. Thank you so much.

Katherine Getao: Ingrid, and especially for enlightening us about some African legal frameworks that are designed to really foster trade. However, there’s a second point that Humphrey raised regarding the logistics. And Kholofelo had talked about last mile, and I also saw a question in the chat. And by the way, I saw people are raising their hands and so on. We will give some time in the last 20 minutes or so for questions, but please feel free to put your question in the chat. I’m looking from time to time, so I’ll try and pick it up. But we hope there’ll be a chance for one or two people to also raise their hands and we hear their voice. So I’d like to turn to Christina now from the Postal Corporation because of that last mile concern, because it is also about telecommunications networks and so on, but there’s also the issue of roads, rail, air travel, and all that, and all the means that are needed to quickly deliver physical goods to the clients. So this being a crucial aspect of digital trade, could you share some of the complexities, opportunities, and challenges of transporting goods across Africa in a timely, safe, and secure manner? And then if you have a little time after answering that one, just tell us what unique advantages the postal services, because I think all countries have a postal service, might bring to the table as we try to meet this challenge. Go ahead, Christine. Thank you.

Christine Mwarenge: My name is Christine from Postal Corporation of Kenya. For the first question on the complexities, logistics is actually very crucial for digital trade and goods in Africa. We have quite a number of complexities and challenges. The one that I see that mostly affects when it comes to the logistics is the infrastructure deficits. Because many regions in Africa, Kenya included, suffer from inadequate roads, rail and port infrastructure. Therefore, this can lead to delays when it comes to moving items from one point to the other. It also increases costs. And costs is a major challenge in the African continent. Secondly, when we look at the inter-countries, we have also political instabilities, where some areas experience political unrest, which can disrupt transportation routes and create safety concerns in as far as logistics is concerned. Another critical area that we have also seen as a challenge or a complexity, especially like in Kenya, the connecting flights within Africa. Pretty difficult because sometimes we don’t have those connecting flights. Hence, it brings about delays in delivery of goods to the intended persons. Human capital is also skilled human capital and shortage of personnel can also affect the efficiency and reliability of transportation of the e-commerce items especially. and there is that need of speedy transportation of e-commerce items for our customers. When it comes to other challenges, high cost of transportation costs due to the infrastructure that is in place, Kenya included, are often higher than in other countries outside Africa. So this will affect the high fuel prices for our fleet and also maintenance charge, maintenance fee of maintaining our vehicles. I don’t know if you asked about the opportunities. We have the technology advancement, the adoption of digital technologies such as enhanced tracking systems and automation will improve our logistics efficiency and transparency. There will be e-commerce growth in Africa which will open avenues for many logistical companies and in the process, especially in the last mile delivery services, in the process have employment for various categories of people, women included, so we’ll be able to open industries in this logistics, in the e-commerce platform. On the issues of the advantages that postal services would have on this, the advantages that we have on this, accessibility because of the wide network that postal services across the world have, especially in Africa, an extensive network to the remotest of places, meaning that we’ll be able to serve even those ones who the customers who are in the interiors. So this really helps and it’s an advantage, accessibility for postal services. We also have a universal service obligation, USO. Many postal services are mandated to provide that affordable and reliable services to all its citizens by the government. So that to us is also an advantage. Affordable rates also for the postal operators vis-a-vis the competition that we have, i.e. for us in Kenya, the EMS offers competitive pricing, especially for small packages. Hence it is a better option that is relied on by most of the customers. The brand name also, having been there in history for a long time, helps a lot because the customers believe in us, there’s that believability and trust by the public. So that is one key advantage that we have. We have also regulated services under the government regulation and we have the government really participating in delivering of these services, supporting the postal services. For instance, for now, the only challenge that I see is the national addressing, which has now been taken up and is being done, like for instance in Kenya, where there’s a committee that has been put up to have the national addressing systems in place, where we have offices that are addressed and automated in a way for last mile delivery. Thank you very much.

Katherine Getao: Okay, excellent. Thank you so, so much, Christine. That was certainly very helpful and you’ve raised issues which I actually had not thought. Thank you very much. So it’s now last but not least, of course, we have Gertrude and finances because if these goods and services have to move, usually there’s a cost implication and there has to be a transaction where one person pays and another person receives the payment. So Gertrude, tell us a little bit about these financial transactions that are so essential to digital trade. There have been complaints that they can be insecure, costly and inconvenient. How are new digital financial solutions such as mobile money addressing the challenges of transacting money across geographies and supporting seamless trades within Africa? And what further improvements are needed to ensure accessibility, affordability and security in financial transactions? Gertrude, please go ahead.

Gertrude Bandari: Thank you, Katherine. And good morning. Good afternoon. My name is Gertrude Bandari, a business planning lead at financial services at Safaricom. Financial services here means M-Pesa. So it’s been very interesting conversations and looking at how we then enable digital trade. For me, I would look at it from also an access perspective. So the biggest challenges then you find is around access. Mostly, if you look at Africa in general, I think we’ve lagged behind from financial or banking access for most people. And in some parts of Africa, Kenya being a leader in that, and in other parts, we have Uganda, Sudan, and all those. When mobile money then came into play, that really elevated the financial access to most people. But that, as much as it has elevated most African countries, you find that some people are still excluded from formal financial services. So then you find that how we move then to enhancing digital trade becomes a bit of a problem, because even inter-country locally trading then becomes a challenge in some countries. Because if you look at, for example, Sudan, I think the financial inclusion is below 10%. So in such areas, you find that then even traditional trade becomes a problem, and digital trade even more difficult. So looking at how then can we enable financial access to most people, how can we influence consumer behavior, for example, for people to then know that they can use financial services? And then that brings me to the second point around security. Security is also a very critical part of this ecosystem, because then that ensures that the consumer is comfortable using this digital finance type of capability that is in place. So ensuring that platforms that are safe and secure is very critical, because without that, then it means people might lose money in the process of trying to trade. So for organizations that then provide in providing regulations that then govern how money moves in and out of the ecosystem to prevent fraud that happens in the ecosystem, but also any participants that are not of goodwill. Additionally, around what I’ve seen a lot in the African ecosystem and Kenya to be very specific is around social engineering, where we have a lot of customers that duped into thinking that whoever was speaking to them is a financial services expert or employee of either a bank or mobile money operator. And through that, then you find that most of them are actually duped and they lose money. So how will players or participants then ensure that, one, their customers are aware of such activities so that then they can safeguard themselves, but also continuous education, customer education around fraud activities, how to secure, for example, if it’s your PIN, how do you ensure that then these customers then do that? So for me, I would look at it around how do we ensure there’s access? And once they have access, how do we ensure that their money is safe?

Katherine Getao: Thank you very much. for raising some very pertinent issues. And every panelist is actually raising issues that make me want to go down a rabbit hole. But for now, let me just try to get the broad view of most of the issues and the opportunities around this digital trade. So I’ll turn back to Kholofelo and just ask about something different. And this is social media marketing. We’ve seen e-commerce around the world being driven by these very clever algorithms that are able to target customers with advertising to lead them to certain products and services. However, most platforms that are commonly used, and I can see somebody in the chat is talking about ClickBank and other platforms. None of them are African. And indeed, the person has even said that we are blocked from trading in some of those platforms. So can we rely on the current global ecosystem of platforms to promote African intracontinental trade? Or should we consider empowering African traditional and electronic media to take on the role of driving e-commerce on this continent? And if so, what strategies would you recommend for engaging African media in this digital trade agenda? Kholofelo, please go ahead.

Kholofelo Kugler: Thank you. This is actually a very, very important and pertinent to how Africans conduct e-commerce question. So I just want to deal with the reasons why Africans are precluded sometimes from trading on some international platforms. And then I’ll address the other questions. And it all boils down really to trust, right? A lot of African countries do not have the regulatory and the enforcement mechanisms to ensure that all of the transactions are trustworthy and customers and also the buyer, I mean, the seller on the other side will have recourse should they require recourse. This is a major reason why there are such restrictions or when they are, they’re either high costs or there are restrictions as I saw in the chat as to what kind of accounts you can open. Something in the chat highlighted that PayPal, you can open an individual account but not a business account. But I know in some countries and I can point to my own South Africa, there has been a move to partnership with some financial institutions. For example, a few years ago, one of the biggest bank in South Africa, First National Bank, you were able to open a PayPal account in which you could freely transact no matter what. So I think the solution’s there. If we do want to trade on these big international platforms, there has to be domestic changes, there has to be domestic partnerships in order to ensure a secure environment of trust essentially. And then I go back to the issue of the platforms, international platforms versus African platforms. I think first of all, number one, we have to come and maybe think about a balanced and maybe even hybrid approach. It’s true that some of the biggest social media and I’m not even talking about the e-commerce platforms like your Amazons or Ebays or whatnot, but a lot of trade happens just on Facebook marketplace. And in fact, WhatsApp, I just attended a Metta conference a few weeks ago and in the global South, especially in Africa, a lot of trade is happening on WhatsApp. And we cannot as a continent ignore the fact that a few billion, a couple of billion people are conducting transactions on WhatsApp. And we can also use it as a tool for ourselves to enhance our own businesses, e-commerce trading. So I don’t think that we should or must, in fact, ignore the big platforms that are already established. We should use them and leverage them, but also at the same time invest in our own domestic and African-owned digital media platforms. These are things that we can adapt to African specifics, adapt to African languages, adapt to African domestic idiosyncrasies of how we trade and how we do businesses, which I believe that you cannot really adapt, you know, Facebook or whatever it is. Although, of course, you can trade as much as you want, but sometimes the language and sometimes the regulatory environments around these big platforms are not local or localized enough. What I think we should really do is, you know, when you mention things about the traditional media, something that we forget even that traditional media still holds a very, very strong influence on how we consume media. A lot of Africans still consume media through traditional means like the radio and television. And although you and I are online and all of our lives are online, this is not the typical African person, which, you know, we might be quite shocked to think, but the typical and many African people are not in the urban centers. They don’t have access to all of these digital medias that we’re talking about. So we’re still talking about newspapers, televisions, radios, et cetera, et cetera. And I think this is when we should really start to think about promoting African champions, e-commerce champion, business champions, ensuring that, you know, that there’s partners between the media houses, obviously digital media houses that also have multiple outlets, right? It could be print media, it could be radio media, it could also be TV. See how we can start, you know, advertisement, highlighting the, you know, the businesses that are doing well, the juniors of this world, of course, each and every country has got its own, you know, e-commerce giants. You know, you just have to go to one country and ask them which is the e-commerce giants. And I think we really have to start thinking about how are we creating and enabling an environment where African platforms can flourish in Africa and that we don’t only rely on those international giants to provide, you know, a conducive business environment for Africans. So I’ll leave it at that.

Katherine Getao: Okay, thank you very much, Holofellow, for broadening our viewpoint. I see there’s a question that we did not define digital trade at the beginning. Digital trade is broader than e-commerce. E-commerce is just one aspect of digital trade where you have marketplaces on the internet. But digital trade is any kind of trade that is automated or uses digital systems. So the whole Kabon, the port systems, the logistic systems, and all the types of system that support trade even when it’s not business to customer or business to business, e-commerce falls under digital trade. So we just thought that we’d make it a bit broader than just e-commerce because we believe that Africa can benefit from this broad definition of digital trade for prosperity. I hope that’s enough. If not, you can indicate in the chat. So let me move to Humphrey. So I really liked the words that Kholofelo used, words like balanced approach, words like leveraging, but investing locally, and words like exploiting the opportunities that we already have, even in the traditional way. So there’s one thing which I’m not sure we have in place, but you’ll tell me more because I think you’ve already referred to it. The digital world feeds on data. You need a lot of data, especially for the emerging technology. It feeds on large amounts of data of which we are already informed that… very small percentage is actually generated on the African continent. So what do you see us doing about Africa’s data deficit and can traditional methods of data generation effectively address this gap or is this an area where we should be encouraging young Africans to innovate? Yes, there will be some. I will turn to legal and regulatory frameworks, so the concern is seen. But Hamphrey, just turn to you right now and please talk a little bit about the data deficit.

Humphrey Njogu: Yeah, thank you very much. Yes, indeed, data is a concern that we have in the digital trade sector, because if today you are to ask anyone in the African country, where are we in terms of the digital trade? How much have we generated in the last one month? How much have we generated in the last one year? What is our projection looking like in the next five years, 10 years? So I think this is a question that we are likely to see a lot of uncertainties, a lot of inaccuracies, and this is because we don’t have very robust ways of collecting data. So you realize that a lot of us across African countries, we’re still using the traditional ways of collecting data. So a case in Kenya here, the data that I would say is the most up-to-date at the national level, when we talk about e-commerce or digital trade, I could say it was actually collected about maybe four or five years ago. That’s when we did it. I think that’s the time we did the national census. So this is something that is telling us that When it comes to having accurate data, reliable data, complete data, it’s a concern that we need to really take into account. And now that we are in a space where we are dealing with data-driven decisions, so when we are dealing with updated data, data that is not complete, definitely it means that there will be negative implications when we are making a decision. So yes, we can’t continue relying on the traditional ways of collecting data, where you’re using a questionnaire, the hard copy questionnaire, you move from one place to the other, one household to the other, you move from one business to the other, collecting hard data. I think that time, that’s an approach that I think we really need to share, you know, work with it. Now, technology has given us a lot of opportunities in terms of enhancing how we can collect data. So for instance, when you look at the emerging technologies, the artificial intelligence, AI, now that we have many tools that are AI-enabled, so we could be able to integrate solutions that consumers are using, services that consumers are using, in a way that we are able to collect the data about our consumers, about the suppliers, about the producers, about the distributors, and channel that information to where it’s actually needed. So for me, I still feel that this is an area that we need to really ensure that we are leveraging on the emerging technologies, the likes of artificial intelligence, and now the blockchain, and you can imagine that with the digital currency, we can be able to do even further analytics about it. Motef. So in terms of analytics, I think we can take advantage of the emerging technologies that we do have, and therefore, able to have representative data that could be able to help us to make informed decisions. So in addition to that, we also have the social media, which is a part and parcel of most of the African people. We’re not making use of it. So social media, by doing analytics of social media, we can actually be able to do so much, collect the preference of these people, understand what they want, do a survey and all that. So social media is a good platform that we can be able to leverage on. So in a nutshell, I would say that the emerging technologies and the technologies that we are seeing today, if we take advantage of them, then definitely we are able to overcome the challenges and the shortcomings that we have with the traditional ways of collecting data. That’s the question here. And therefore, we’ll actually be speaking of big data, and this big data definitely is really going to contribute in terms of making well-informed decisions, and we’re also able to serve our consumers quite well. And more importantly, we’re also able to direct the producers, the distributors quite well, where gaps are. So definitely, I think there’s so much that we can be able to do if we’re able to apply these technologies, especially the emerging technologies, quite well to address the gaps that we do have in our data collection systems and our bureaus. By the way, I should also have mentioned that we still have the traditional bureaus or the bureaus in every country collecting data. And you still find that most of these bureaus haven’t been able to migrate to the new technologies of collecting data. And I think this is also a concern that if we want to build robust data systems, data management systems, then definitely it’s not just about the producers, but also even the official custodian of the data. Those bureaus, they also need to also to modernize the way they collect the data. And we also need to do the analysis of this data so that we are able to communicate, create other stakeholders in this digital ecosystem. Back to you, Katherine.

Katherine Getao: OK, thank you very, very much, Humphrey, for just giving us an overview of the challenges of traditional data collection methods and also how the new technology can help us to capture data in real time. I’m sorry, it’s raining cats and dogs here in Nairobi, so I hope you can still hear me. Please do indicate if you’re struggling because we’re having, I think, our first big rainstorm of the season, complete with thunder and lightning. So I don’t know whether it’s God approving of this webinar or objecting to it. So there are questions in the chat about the financial regulations or legal framework that will enable the transfer and transaction of money between different countries. And just as you’ve already referred to the Malibu Convention and. Africa free trade area policies. I’d really covet Ingrid’s advice on what’s going on in the financial area to make sure that things are harmonized and people can trade safely under a safe legal framework in the continent. Over to you Ingrid.

Ingrid Serwah Asare: So we find that in terms of digitalization, it happened along the way. So you have, at least in the case of Ghana, you have Fintechs who sprang up and they were not being regulated like mainstream financial institutions by the central bank. But with time became important or relevant for the central bank to also pay attention to some of these systems that are being used and then put in place the regulations to, you know, try to monitor or ensure that their operations are within the framework of the law. And so now, again from a Ghanaian perspective, you have some form of regulation that is happening in the Fintech space, ensuring that they are properly licensed. And there’s a lot of monitoring going on such that if you find that some of these platforms that end up online are not even being used in the proper sense. There are instances where we had loan apps, for instance, that were encouraging people to take loans. However, because you are not properly aware of how to use your phone, how to protect yourself online, you would find that they then tend to, in trying to recoup or get back the amount that they had given out, then because they have access to certain permissions on your phone or whatever data. system you use to take the loan, blackmail you on other, you know, other, they have access to your camera, so blackmail you based on the information they have on you sometimes. And with that, in Ghana, when that happened, for instance, given that in this space, there’s also the need to collaborate and the Central Bank with the Economic Organized Crime Office and the Cyber Security Authority in collaboration, went after, identified all these loan apps, all these systems that are not even being used properly for trade, and then put them all down and also went after, found the perpetrators behind it and went after these ones. Subsequent to that, emphasizing on the need for these systems to be properly licensed so that they adhere to proper regulation. Embedded in that is also the adherence to data protection laws. How are the personal data, definitely in transactions, personal data comes into play, financial data comes into play. How are these entities adhering to the data protection rules and laws such that the information, your personal information that you’re putting on these systems are being protected, then again? And then, of course, in terms of breach, the various sanctions that would be applied to such entities, should you, should they not use your data properly? And actually even inform you, the user, of how your data that is being collected is going to be stored and how it’s going to be used or even disclosed to a third party, if that is what happens within their transactions. And then, of course, the policies that have been put in place to ensure your online safety. and I’m going to talk about the capacity building and awareness creation. If you look at the status quo act of Ghana, for instance, there’s room for capacity building and awareness creation for the public. One of our colleagues did mention social engineering for the public in the systems in engaging in trade. You are very much aware of how to engage, have a sense of who you’re even verifying, who you’re even engaging with. There are also, once you have cybercrimes being committed around to fraud, for instance, the room for reporting criminals which are in existence and then the prosecution of these crimes bringing the perpetrators to book. Unfortunately, given that we are in an online space, I mean the rules are there, they are being implemented, the prosecutors are doing their job, but there’s still that challenge of trying to identify these criminals given that we are in the online space and that’s, for them, the advantage of anonymity. Thank you.

Katherine Getao: Thank you very much, Ingrid, for educating us on some of the challenges around the use of digital forms of transaction in Ghana. I think it’s still at the nascent stage for the person speaking about continental regulation. You can see that each country is almost struggling on its own. with emerging challenges and issues. So this is something which can come out of this webinar that we need also the regional approach to look at some of these challenges and see if we can have model legislation or cross-cutting legislation that would help us address these challenges across geographies. Now given that money is where it hurts, I’ll turn to Gertrude once again and just ask her that an ideal digital financial transaction should be low-cost, secure, and provide an unalterable receipt for the pair. With new technologies like cryptocurrency being used and competing with even the older forms of digital money like M-Pesa, how are companies like your company adapting to meet the trader’s demands for affordability, speed, accuracy, security, and documentation in these financial transactions? What will be your competitive edge going into the future? Gertrude?

Gertrude Bandari: Thank you. I think I would look at it also from a regulatory perspective, financial services being a heavily regulated industry. So as the new forms of payments, for example, like crypto come into play, I think it’s how we provide value to the customer. So I know from a regulatory perspective most African countries are still trying to figure out how crypto works. A lot of central banks have done research and papers. around the digital currency and which is still in nascent capacity in most African countries. So how we’re looking at it, if I can give an example from an M-Pesa perspective is, how do we provide more value to the customer? So if you look at how customers today transact, we have enabled customers to be able to send money across each other, which we call P2P, so person-to-person. We’ve integrated with banks to enable customers move money to and fro from banks, what we normally call bank-to-customer and customer-to-bank. So as a customer, you’re able to fund your account through M-Pesa. As a bank customer, you’re able to fund your wallet, move money from your bank to M-Pesa and vice versa. So with such availability, so you find that at least you’ve enabled customers to be able to transact from a reliability perspective. And also back to access for customers who have physical cash and would like to cash in or change the money to e-value. I think from an M-Pesa perspective, we’ve ensured that we have one of the largest agency networks in the country of around 266,000 agents cutting across all regions. With that, then that means that we’ve brought the agency network close to where the customer is. If you look at how banks have also done it, they’ve tried the agency model, they’ve also have branches, but you find that the coverage is not sufficient. So with our agency network, then you find that we have at least every two kilometres, you’ll find an M-Pesa agent. With that, then we’ve enabled… We provided access to customers who probably would have cash that they would like to convert to e-value. And also, the other piece that we’ve done is around providing payment points, touch points, which we are calling merchants. So at the moment, we have over 600,000 merchants. So with this, then you’re able to pay for things, if it’s shops, if it’s restaurants, we’ve been able to work with all industries so that then a customer is able to pay through mobile money. So with all this, then you find that at least from an access perspective and a distribution perspective, we’ve enabled the customers to be able to, one, they can do cash in, cash out conveniently, but also you don’t have to also do cash out. You can, with money that you have in your wallet, you’re able to pay at any point. We have a running joke that says that in Kenya, if you live with your phone and you have Mpesa, you have your wallet with you. You don’t have to work with a physical wallet that has money. And that’s how we’ve managed to revolutionize the industry. Additionally, also looking at also the businesses, because also we have to enable the businesses. That’s how you look at the full ecosystem. So we’ve looked at how businesses operate today in Kenya. So we have micro businesses, we have SMEs, we have large corporates. So we work across all the businesses, where for big businesses, medium businesses, we’ve provided them with what we call merchant tills and pay bills that they’re able to then accept payments. But then we realized that there’s an interesting lot which we call micro merchants. So in Kenya, we call them Boda Boda, the motorbike guys who then enable guys to move around. We have what we call Mamambo guys, which are the small scale kiosk traders that also sell goods in either estates or in the rural areas. So we realize there’s a need. So then what we’ve done with that also is to provide a separate wallet. So today, if you are a small trader, then you don’t need because the requirements for having a merchant till is also quite high, where you’ll need a carry pin for you to be able to open a till. So what we’ve done then is ensure that for these small traders, then if you have a phone number, you have a Mnempesa wallet, then we are able to separate your funds, whereby you have your personal funds where you’re able to trade, but also where you’re able to send and receive money. But also we’ve enabled a separate wallet, what we call pochi, which is a Swahili word for a pouch. It’s like a wallet. So it’s a separate wallet for small customers to then be able to receive funds. So with that, then you’re able to separate your personal funds and your business funds. With that, then we’ve also enabled the small traders to also be able to receive funds. This then ensures that anywhere you go, you’re able to transact as little as 10 shillings, you’re able to then pay or receive funds. What now we are currently doing as we’re looking forward, we’ve enabled customers to move money, pay money. So we’re getting into the credit business, whereby we have products like Fuliza, which is an overdraft facility. And how we are looking at this product is to provide dignity to a customer. So if you’re paying and you have insufficient funds, you’ve been credit scored, you’ve been given a limit, if you go to a shop, you’re able to pay, you’re able to overdraw your wallet. We are moving into buy now pay later type of products, where if you have a vision of revampishing your, okay, you have some wonderful products that I think could go on for a while. Yes.

Katherine Getao: But I think what I’m getting from you is that by having products which are very appropriate to our local environment, we can compete with global products, because they’re very young. So thank you for that. Perhaps only in one sentence, you can tell us, if I want to send money to another African country, do you facilitate that? Because I think there are questions arising about that. How do we send money, not just within a country, but also outside, very briefly?

Gertrude Bandari: All right. So what we’ve done also is to partner with players in international money remittances. We have partners like TerraPay, Western Union, that connects us to over 200 countries. So with that, then we’re able to enable customers and PESA customers to send and receive money. As a country, I will give an example of Kenya, as a country, we are net receivers of international money remittances, whereby we have, most people have relatives outside the country that then send money back home, where we, I think around over 50% come from the US corridor. So if you look at how even Central Bank then has looked at in bond. I would say M-Pesa contributes to over 70% of the funds that come into the country. So we continue doing this through partnerships for all to enable movement of money in and out of the countries. And eventually what then we’re looking at is to integrate to all through APIs, to integrate to most African mobile money platforms such as MTN, Momo, Airtel money in other countries. So that then we are able to wherever you go to a different country, then you are able to move freely and you’re also able to move funds across wallets, mobile money wallets in Africa. Thank you.

Katherine Getao: Thank you very much Gertrude. Obviously the question doesn’t answer everything because we’re evolving, but I think by APS you meant the African payment system. So there is an attempt through the African free trade area to really buttress up the idea of enabling money to move freely between African countries as we trade and tour and work together. So I haven’t forgotten you Christina, maybe I’ll give you the last chance because I can see we’re almost 15 minutes, just over 15 minutes from the end and I do want to give a chance for a few participants to ask their questions and direct their questions to the panelists. So Christina, could you just briefly tell us anything that the postal corporations are doing to move from the post box model where you have a box and then in a specific place and you have to go and collect your mail there. Given that we have a young mobile population who move around and who also want goods and services to be delivered to them regardless of where they are. Is there anything that you have in the pipeline to serve this young dynamic and largely informal population, Christina?

Christine Mwarenge: Yeah, thank you, Dr. Tari. Yes, it is true. The private letterboxes was the traditional method, and it still is. That is still in use here in Kenya and I believe in other African postal services. Because there’s still some age bracket that still uses it. That’s notwithstanding. Due to the youth and other age brackets that have moved to digital, wanting the digital services, and they want convenience. And because of the changing customer needs, people prefer to have their deliveries or their e-commerce items and packets down to their doorsteps. We call it door-to-door deliveries and or last mile delivery. What we have done, we as Postal Corporation of Kenya, we have developed mobile apps where now you can be able to track and trace your item and we can deliver to your doorstep. Moving further, we are partnering with the communication, the CA of Kenya Authority and other ministry partners to have the national addressing system working. And it’s still work in progress through the government. This will enable us to reach all the areas where even the young are. We are also coming up with flexible delivery options, offering flexible delivery times and locations, such as designated drop-off points, which can accommodate the youth on that bracket. Leveraging also as I’ve said on the mobile technology and apps where we can be able to help track deliveries and provide real-time updates to our customers both the sender and the recipient. Partnering also with local businesses or individuals who can act as intermediaries or pickup points. This can streamline our delivery process and which the youth really prefer. Implementing smaller more agile delivery vehicles that can also navigate as I said our infrastructure in Africa where we have encrowded streets can also come in play. Yeah I think basically drop-off points in designated areas like for Nairobi in areas where we customers do not have to come to the post offices they can actually get us in designated places. The other thing that I can talk about those drop-off points easily accessible to the customers. We are also establishing postal hubs for cross-border trade between our neighboring countries to be able to reach people would want maybe to like the youth to push their items maybe from Tanzania to Kenya becomes very very easy through this cross-border trade. The other thing is align we are aligning the postal services with a booming e-commerce sector where we offering online solutions for online marketplaces and also last-mile deliveries. We are also leveraging on understanding the new trends. for instance, the data-driven insights to understand our customer behaviours and the new trends. And, well, optimise the routes to be more efficient, the routes that we have to be more efficient and removing all the bottlenecks therein. Yeah, I think that’s what I can say for now.

Katherine Getao: Thank you very much for telling us how technology in a variety of ways can increase the efficiency and cost-effectiveness and convenience of the logistics. And I think in Africa, as we said at the beginning, there’s endless potential. We’re the young continent with many young people. So, I can see time is really going, so I’m not going to summarise, because that would take quite some time. For those who are asking whether the notes of the meeting will be available, there is a recording on the website, and I’ll ask Mwende, please, to share the URL for the Africa page of the Diplo portal. So, you can not only watch this particular, but you can also watch previous webinars, which have been quite interesting and on a variety of topical issues. So, please, Mwende, share the URL so that people can get there. I’m not sure about the meeting notes, but perhaps you can answer that question also in the chat. So, I think we have time for maybe just two people to raise their hands and ask their questions. And I believe Alvin is in the room, so he can enable them to speak. I’m not sure you can unmute at the moment, but please do raise your hand. And as we select your hand, then you can direct the question either generally or to a specific panelist. Okay, so is there anyone who would like to raise their hand and ask a question verbally? Okay, we don’t seem to have any takers. So perhaps then I can use the last few minutes to ask my last question and just quickly go around. Basically, you have not more than two minutes to ask a quick answer to this. So maybe we’ll begin the other way around. So beginning with Christina and moving to Ingrid and then Gertrude, Humphrey and Kholofelo. Looking ahead, what would you identify as the top priority for achieving a prosperous and secure digital trade environment across Africa? And what immediate actions should stakeholders focus on to make this vision a reality?

Christine Mwarenge: For me, a quick one. Re-engineering, especially on the logistics area, would really be very, very crucial, especially for postal cooperation of Kenya in moving forward. Partnering with other people so that with other players in the industry or in the market so that we leverage and ensure that we give proper timely deliveries to our clients and to our customers. That is pretty, pretty key for us so that we can also save on costs on infrastructure and on fleet. That would really be key for us. Thank you.

Katherine Getao: And we can move on to Ingrid.

Ingrid Serwah Asare: Okay, so for me, prioritizing the African Continental Free Trade Area Agreement and actually implementing it because a lot of the provisions, particularly with respect to the digital trade policy, would, at least if we start as a continent, would begin to address some of the issues we’ve raised here today and also prioritizing the implementation of the Malibu Convention so that all these investments we make around digital trade infrastructure is also secure and that, as a continent, we’re able to benefit from the funds, the resources that we put into these systems and also it will enhance and boost digital trading among member states as a continent. Thank you.

Katherine Getao: Thank you very much, Ingrid, and I hope we’re all downloading these agreements because they could answer some of the questions which I see in the chat. I move on to Gertrude, your priority area.

Gertrude Bandari: Thank you. I think prioritizing partnerships around cross-border is critical. So what Ingrid has mentioned around implementation of the African free trade, I think it’s very critical because then that brings up about public-private partnerships, governments, businesses, and any private sector engagements. And also cyber security and reliability is very critical. How do we ensure that the platforms that we give are secure, they are safe, but also they are always on in terms of whenever people need this service, then they are available. And I think also another piece is around the digital infrastructure that we talked about, internet connectivity. Also, once we have the internet connectivity, how do we have smartphones available for people? So around either providing for device financing or ensuring that we have affordable smartphones that then this can enable digital trade. And then the last one is around digital literacy, because we’ve spoken a lot about digital trade. So how do we ensure that people are actually digitally literate for them to be able to move into the digital trade? Thank you.

Katherine Getao: Thank you very much. And I’m hearing the word partnerships a lot. So I hope it’s going to be one of the outputs of this. I think you’ve seen who is on the call, and there’s certainly room for partnerships to arise. Humphrey, please go ahead. What is your priority?

Humphrey Njogu: Yeah, my priority one is to think of investing in infrastructure, especially in the unserved and underserved areas, especially in the rural areas, so that we’re able to have a successful digital trade. Secondly, we also need to… who invest in data management, especially the modern ways of managing data so we have accurate data that will inform our decisions as we progress in this digital trade. is to promote consumer empowerment programs because at the moment we are not doing well. Last but not least, to promote the close border enforcement cooperation so that in case we have illegal goods or things that are of low quality, we are able to contain them even with our neighbours when we work together. So those are my four priorities. Last but not least, we also need to think of some incentives that we need to give, especially to the small and medium enterprises so that they are able to digitize their services and their products and therefore supporting a digital trade in Africa. Thank you.

Katherine Getao: Okay, thank you for introducing that idea of incentives towards digitization. And of course, a lady should always have the last word, so Kholofelo, I would be very, very glad if you would just summarize what you think are the priorities we need to work on from tomorrow.

Kholofelo Kugler: Yes, I mean, I think my colleagues have already covered the most pressing ones, the regulatory and the infrastructural ones, but I think on top of that, we really should understand what is the digital trade ecosystem in Africa. What are companies doing? What are they doing well? Where are the hubs? Why are there hubs? Why are they successful? Why are some areas not as successful? And really start to think about how do we then expand the positive models, the success models to other places and whether they can as well, or can at all. And then we think about regulation. Sometimes we can overregulate, which will kill innovation, but we should think about all the tools that we have at our disposal, like regulatory sandboxes, as Gertrude was talking about, how do we expand access to finance? And how do we expand digital literacy? How do we support the systems whereby anybody who’s sitting in Ghana can sell their cloth to anybody sitting in Kenya, knowing that the good will get there when it’s supposed to get there. and this is the last mile. So really we should, I think every country in Africa and also collectively through the AFCFTA really start analyzing and seeing what is the situation analysis. What exactly are we trading? And then we can start thinking about how do we actively and how do we effectively regulate some of these areas and sometimes have priorities as to this might not be a priority area right now because there’s not much activity here but this is definitely a priority area. I think this is when we can start the effective implementation of the AFCFTA digital trade protocol. I think the agreement is great. We’ve got lots of innovative and also sort of sound provisions in there but obviously we’ve got budget limitations, we’ve got capacity limitations. So we should really start with A, what is those low-hanging fruit and B, what are the needs that we have, the pressing needs and sort of prioritize what is it that we need so that it really works for Africa. We cannot copy and paste what everybody’s doing around the world because we’re not everybody around the world, we are Africans. So we really should adapt regulation and the ecosystem for our own idiosyncratic environment in Africa. So thank you so much.

Katherine Getao: Very, very much to all the panelists. You’ve really enlightened us. I am by no means an expert in digital trade. We just choose topics that we believe are very current and very important for our continent and then the experts here are really the experts. I’m just the moderator. However, if you want to get in touch, please leave your email in the chat so that we can capture it and get in touch with you. I’ve seen a few requests, so just kindly leave your email address in the chat and we’ll be able to capture it and get in touch with you for more. Many of you I think can be future panelists because you’re experts in your own area. Thank you very much to each panelist. I thank Kholofelo, I thank Humphrey, I thank Gertrude, I thank Christina, I thank Ingrid. You’ve done a masterly job of telling us what’s happening in your own country as a best practice. You’ve also told us about the urgency of this African agenda and the things that we need to do and so we’re very thankful to you. So being one minute late, I think I can declare this webinar officially closed. Please look out for the advert for the next quarter which will next year 2025 between January and March. We will have a new webinar and if you’d like to share a topic please do get in touch with us through Diplo and we will take into account your preferences of what you would like to see. Thank you very much to everyone and thank you to the technical team for the work they’ve done, Arvind and your team. We’re very grateful. We’re also grateful to Mwende. She’s done a lot of the administrative work and all our colleagues at Diplo. Thank you to all the Africans who are so passionate about this continent for attending our webinar and we look forward to working with you again. God bless you and good morning, good evening, good night. you

Agreement Points

Infrastructure challenges hinder digital trade

Christine Mwarenge

Humphrey Njogu

Gertrude Bandari

Infrastructure deficits hinder digital trade

Data deficit and inaccurate statistics impede decision-making

Mobile money platforms enable financial access and transactions

Multiple speakers highlighted how inadequate infrastructure, including physical and digital, poses significant challenges to the growth of digital trade in Africa.

Need for improved data collection and management

Humphrey Njogu

Kholofelo Kugler

Data deficit and inaccurate statistics impede decision-making

Traditional data collection methods are outdated

Analyze digital trade ecosystem to inform targeted regulation

Speakers agreed on the importance of improving data collection methods and analyzing the digital trade ecosystem to make informed decisions and implement effective regulations.

Importance of legal and regulatory frameworks

Ingrid Serwah Asare

Kholofelo Kugler

Legal frameworks needed to regulate digital financial services

Implement African Continental Free Trade Area Agreement

Analyze digital trade ecosystem to inform targeted regulation

Speakers emphasized the need for robust legal and regulatory frameworks to govern digital trade and financial services in Africa.

Similar Viewpoints

Both speakers highlighted the importance of partnerships in leveraging existing infrastructure and enabling cross-border transactions.

Christine Mwarenge

Gertrude Bandari

Partnerships can help leverage existing infrastructure

Partnerships with remittance providers enable international transfers

Both speakers emphasized the role of technology in improving data collection and ensuring the security and reliability of digital platforms.

Humphrey Njogu

Gertrude Bandari

Emerging technologies like AI can improve data collection

Prioritize cybersecurity and platform reliability

Unexpected Consensus

Importance of adapting to local context

Kholofelo Kugler

Christine Mwarenge

Analyze digital trade ecosystem to inform targeted regulation

Postal services developing mobile apps and flexible delivery options

Despite coming from different sectors, both speakers emphasized the importance of adapting digital trade solutions to local contexts and needs, rather than simply copying global models.

Overall Assessment

Summary

The speakers generally agreed on the importance of improving infrastructure, both physical and digital, enhancing data collection and management, and developing appropriate legal and regulatory frameworks for digital trade in Africa. There was also consensus on the need for partnerships and adapting solutions to local contexts.

Consensus level

The level of consensus among the speakers was relatively high, with most agreeing on the key challenges and opportunities for digital trade in Africa. This consensus suggests a shared understanding of the issues at hand, which could facilitate coordinated efforts to address these challenges and capitalize on opportunities for digital trade growth across the continent.

Overall Assessment

Summary

The speakers generally agreed on the main challenges and opportunities for digital trade in Africa, with each contributing complementary perspectives from their areas of expertise.

Disagreement level

Low level of disagreement. The panelists presented aligned views on the need for improved infrastructure, legal frameworks, financial services, and data management to support digital trade in Africa. This alignment suggests a common understanding of the key issues, which could facilitate coordinated efforts to address challenges and capitalize on opportunities in the digital trade landscape.

Similar Viewpoints

Both speakers highlighted the importance of partnerships in leveraging existing infrastructure and enabling cross-border transactions.

Christine Mwarenge

Gertrude Bandari

Partnerships can help leverage existing infrastructure

Partnerships with remittance providers enable international transfers

Both speakers emphasized the role of technology in improving data collection and ensuring the security and reliability of digital platforms.

Humphrey Njogu

Gertrude Bandari

Emerging technologies like AI can improve data collection

Prioritize cybersecurity and platform reliability

Key Takeaways

Digital trade holds significant potential for Africa’s economic growth, with e-commerce as a key driver

Major challenges include infrastructure deficits, data inaccuracies, and regulatory gaps

Mobile money platforms are enabling financial access and transactions across Africa

Improving logistics and last-mile delivery is crucial for digital trade success

Legal frameworks need to be developed to regulate digital financial services and ensure cybersecurity

Africa’s young population and rising mobile adoption present opportunities for digital trade growth

Resolutions and Action Items

Implement the African Continental Free Trade Area Agreement

Prioritize cybersecurity and platform reliability for digital trade

Analyze the digital trade ecosystem to inform targeted regulation

Provide incentives for SMEs to digitize their services and products

Develop national addressing systems to improve deliveries

Invest in infrastructure, especially in underserved rural areas

Modernize data management systems for more accurate decision-making

Unresolved Issues

How to effectively regulate cryptocurrencies and digital currencies across Africa

Addressing the high cost of internet access in many African countries

Harmonizing cross-border financial regulations to enable seamless transactions

Developing continent-wide standards for data protection and cybersecurity

How to bridge the digital literacy gap, especially among older populations

Suggested Compromises

Balancing regulation to ensure security without stifling innovation in digital trade

Leveraging partnerships between public and private sectors to improve infrastructure

Using a hybrid approach of international platforms and African-owned digital media platforms

Adapting global best practices to fit African-specific needs and contexts

Already in 2020, the IFC and Google estimated that Africa’s digital economy could reach up to $180 billion by 2020. That’s next year, and account for 5.2% of the continent’s GDP. By 2025, it was projected that potential contribution could reach $172 billion, or about 8.5% of GDP.

Speaker

Kholofelo Kugler

Reason

This comment provides concrete statistics about the potential economic impact of digital trade in Africa, setting the stage for the importance of the discussion.

Impact

It framed the conversation around the significant economic potential of digital trade for Africa, leading to further discussion on challenges and opportunities.

We have insufficient data protection laws. Only 61% of African countries have those. We have insufficient cybersecurity laws. Only 72% of African countries have those, about 39 of them. And also, we have insufficient consumer protection laws that apply to online transactions.

Speaker

Kholofelo Kugler

Reason

This comment highlights specific regulatory gaps in Africa’s digital ecosystem, providing a clear picture of the challenges faced.

Impact

It led to further discussion on the need for robust legal and regulatory frameworks, which was picked up by other panelists later in the conversation.

So you find that at least from an access perspective and a distribution perspective, we’ve enabled the customers to be able to, one, they can do cash in, cash out conveniently, but also you don’t have to also do cash out. You can, with money that you have in your wallet, you’re able to pay at any point. We have a running joke that says that in Kenya, if you live with your phone and you have Mpesa, you have your wallet with you.

Speaker

Gertrude Bandari

Reason

This comment provides a concrete example of how digital financial solutions are changing everyday life in Africa, making abstract concepts more tangible.

Impact

It shifted the discussion towards practical applications of digital finance and how they’re impacting daily life, leading to further exploration of financial inclusion and innovation.

We cannot copy and paste what everybody’s doing around the world because we’re not everybody around the world, we are Africans. So we really should adapt regulation and the ecosystem for our own idiosyncratic environment in Africa.

Speaker

Kholofelo Kugler

Reason

This comment challenges the notion of simply adopting global practices and emphasizes the need for Africa-specific solutions.

Impact

It prompted a shift in the discussion towards considering uniquely African approaches to digital trade challenges, encouraging more context-specific thinking.

Overall Assessment

These key comments shaped the discussion by grounding it in concrete economic potential, highlighting specific regulatory and infrastructure challenges, providing real-world examples of digital finance impact, and emphasizing the need for Africa-specific solutions. They moved the conversation from abstract potential to practical challenges and opportunities, while consistently emphasizing the unique African context. This led to a rich, nuanced discussion that covered economic, regulatory, infrastructural, and cultural aspects of digital trade in Africa.

How can we create and implement a continental approach to digital financial regulations?

Speaker

Katherine Getao

Explanation

This is important to address the challenges of cross-border financial transactions and create a harmonized regulatory environment across Africa.

How can we develop and promote African-owned digital media platforms for e-commerce?

Speaker

Kholofelo Kugler

Explanation

This is crucial for creating platforms tailored to African needs and reducing dependence on international platforms that may not fully serve African markets.

What strategies can be employed to improve data collection and management systems for digital trade in Africa?

Speaker

Humphrey Njogu

Explanation

Accurate and up-to-date data is essential for informed decision-making and policy development in the digital trade sector.

How can we accelerate the implementation of the African Continental Free Trade Area Agreement, particularly its digital trade provisions?

Speaker

Ingrid Serwah Asare

Explanation

Full implementation of this agreement is critical for addressing many of the challenges discussed and fostering intra-African digital trade.

What incentives can be provided to small and medium enterprises to encourage digitization of their services and products?

Speaker

Humphrey Njogu

Explanation

Supporting SMEs in digitization is crucial for expanding participation in digital trade across Africa.

How can we improve digital literacy across different demographics in Africa?

Speaker

Gertrude Bandari

Explanation

Enhancing digital literacy is fundamental for broader participation in and benefits from digital trade.

What are the most effective models for public-private partnerships to develop digital trade infrastructure in Africa?

Speaker

Gertrude Bandari

Explanation

Partnerships between governments and private sector are crucial for developing the necessary infrastructure for digital trade.

How can we map and analyze the current digital trade ecosystem in Africa to identify successful models and areas for improvement?

Speaker

Kholofelo Kugler

Explanation

Understanding the current landscape is crucial for developing effective strategies and regulations for digital trade in Africa.