Africa and the Digital Divide: Perspectives and Policies for catch up (Africa Trade Network)
8 Dec 2023 11:30h - 13:00h UTC
Knowledge Graph of Debate
Session report
Full session report
Africa Kiiza
The e-commerce industry in Africa is experiencing both positive and negative trends. On the positive side, Africa has generated close to $33 billion in e-commerce revenue in 2022, indicating the growing acceptance of online marketplaces in the region. As of 2020, Africa has a significant number of online marketplaces, with over 631 platforms recorded.
However, there are challenges that need to be addressed. Africa accounts for only 1% of global data centers, with the majority located in South Africa. To support data management and boost digital infrastructure, efforts should be made to establish more home-grown data centers across the continent.
Improving internet infrastructure is essential in driving the African digital economy, with the potential to increase digital services by over 70 billion. Therefore, Africa needs to focus on enhancing policy space and developing self-sufficient infrastructure to shape its own responsive data governance and e-commerce policies.
The African e-commerce landscape is characterized by an uneven playing field, with only ten countries responsible for a significant portion of businesses online. Additionally, there are structural and capacity issues that hinder e-commerce growth, such as mis-deliveries and delays due to addressing system limitations.
It is crucial for Africa to evaluate the effectiveness of current negotiations and rules in addressing the specific challenges faced in e-commerce. Agreements like the African Continental Free Trade Area (AFCFTA) and the Joint Statement Initiative (JSI) require careful consideration to address capacity gaps and competitiveness challenges.
In summary, Africa's e-commerce industry shows promise, but there are challenges to overcome. Establishing home-grown data centers, improving internet infrastructure, and fostering an inclusive e-commerce ecosystem are key steps to fully leverage the opportunities in the digital economy.
Wullo Sylvester Bagooro
The panel discussion on Africa's digital development addressed several key issues. One of the main points highlighted was the progress being made in bridging the digital divide in the continent. Examples from countries such as Kenya, Nigeria, Rwanda, and South Africa were cited as striking examples of how Africa is bridging this gap.
While progress is being made, it was also mentioned that there are policy measures that could hinder development in the digital sector. These policy measures were not specifically elaborated upon in the provided information, but it is clear that there are challenges that need to be addressed.
Another important argument raised during the discussion was that Africa is not only affected by the global digital divide but can also be part of the solution. This highlights the potential that Africa has to contribute to closing the digital divide globally.
The discussion also urged African countries to reconsider their approach to digital trade, as there are indications that the United States is considering withdrawing support for major trade rules. This highlights the need for African countries to adapt their strategies to these changing circumstances.
Structural economic transformation was identified as a priority for African countries. The panel emphasised that many African countries are heavily reliant on commodity exports, and this dependency extends to the digital sector. To meet the aspirations set out in Agenda 2063, which outlines Africa's vision for the future, the panel stressed the importance of economic transformation.
Collaboration between civil society, the private sector, and governments was identified as a crucial factor in driving digital development in Africa. This calls for the involvement of multiple stakeholders and the fostering of partnerships to ensure a comprehensive and inclusive approach.
Additionally, the panel highlighted the importance of public investment for the establishment of data centres across the continent. This highlights the need for governments and relevant stakeholders to invest in the necessary infrastructure to support digital growth.
The discussion also emphasised the need for increased interaction and relationship building at both the continental and multilateral levels. This suggests that collaboration and cooperation among African countries and with international partners are essential for advancing digital development in the continent.
A final noteworthy observation made during the discussion was the need for better collaboration between governments, civil society organisations (CSOs), and the private sector in Africa. It was highlighted that there is a growing trend of small and medium-sized enterprises (SMEs) complaining that big tech companies are not sharing data. This emphasises the importance of fostering better collaboration and information-sharing mechanisms among these stakeholders.
In conclusion, the panel discussion shed light on various aspects related to Africa's digital development. While progress is being made in bridging the digital divide, there are policy challenges that need to be addressed. Africa has the potential to be part of the solution to the global digital divide but needs to adapt its digital trade strategies to changing circumstances. Structural economic transformation, collaboration among stakeholders, public investment, and increased interaction and relationship building are crucial for driving digital development in Africa. Better collaboration between governments, CSOs, and the private sector is also necessary. Lastly, reducing commodity dependence and increasing production were identified as key factors in Africa's development.
Herbert Kafeero
The analysis highlights several key points regarding the digital landscape in Africa. Firstly, there has been progress in terms of Internet penetration, with the percentage rising from 36% in 2014 to 53% in 2020. However, despite this positive development, there remains a usage gap in Africa. Furthermore, it is concerning that only 28 African countries have consumer protection laws in place to foster e-commerce, indicating a lack of adequate safeguards for online transactions.
Secondly, the analysis points out the existence of a digital divide within Africa. This divide manifests in disparities among different categories of people, and in particular, a widening gap among women. This suggests that certain segments of the population are being left behind in the digitalization process, potentially exacerbating existing inequalities.
Another key finding is the lack of necessary policies for digital transformation in Africa. Only 33 out of all African countries have adopted e-transaction laws, signifying a limited legal framework to facilitate digital transactions. Additionally, data protection policies were only recently passed in many countries, implying a lag in implementing measures to safeguard the privacy and security of digital information.
The analysis also emphasises the need for a comprehensive approach to digital transformation, involving not only the government but also non-state actors such as civil organisations and the private sector. This highlights the importance of broad collaboration and partnership to effectively drive digitalization efforts in Africa.
Moreover, it is crucial for Africa to establish its presence in the global digital economy as both a producer and consumer. Currently, most African countries primarily consume rather than generate digital content, indicating a dependence on external sources for digital services and products. Fostering a culture of innovation and entrepreneurship will be paramount in enabling Africa to play a more influential role in the digital economy.
Financial constraints emerge as a significant barrier to digital transformation in Africa. The analysis reveals that budget allocations for ICT development are insufficient in countries like Uganda. This highlights the urgent need for sufficient funding to build digital infrastructure and support the growth of the digital sector across the continent.
Furthermore, the analysis suggests that addressing challenges related to competition, intellectual property, taxation, industrial policy, privacy, cybersecurity, and the labour market will require new ways of thinking. This implies the need for innovative approaches and strategies to overcome these obstacles and achieve meaningful structural transformation.
Lastly, the analysis underscores the importance of greater participation from African countries in global digital rule negotiations. Currently, there appears to be less involvement from African countries compared to other actors such as the technical community and civil society. This observation highlights the need for Africa to actively engage in shaping global digital governance frameworks to ensure its interests and perspectives are adequately represented.
In conclusion, the analysis provides valuable insights into the current state of digitalisation in Africa. It highlights both progress and challenges, ranging from Internet penetration and the digital divide to policy gaps, funding limitations, and the need for new approaches. By addressing these issues and actively participating in global digital rule negotiations, Africa can accelerate its digital transformation and unlock the vast potential that the digital economy offers.
Audience
During the discussion, several concerns and challenges regarding Africa's digital protocol and the implementation of international multilateral frameworks were addressed. The speakers emphasised that a one-size-fits-all approach does not work for Africa, as each country on the continent has its own unique circumstances. This highlights the need for a tailored approach to address the specific challenges faced by each country in Africa.
One of the significant problems discussed was the lack of data localisation in Africa. This refers to the storing and processing of data within a country's borders. The speakers pointed out that without proper data localisation, there are risks of data sovereignty and privacy breaches. Additionally, tax issues emerged as a challenge, with speakers highlighting the difficulties in regulating and taxing digital transactions in Africa. This poses a barrier to effectively benefiting from the digital economy.
Another important concern that was raised is the low trust in African consumables. It was noted that building trust in African products is crucial for their successful integration into the international market. To address this, it was suggested that Africa should focus on building and leveraging its unique digital products, such as Afrobeats, to overcome challenges and take advantage of opportunities in the digital economy.
The audience also expressed concerns about the financing of the African Continental Free Trade Area (AFCFTA), questioning who is funding the work of the AFCFTA. This indicates the need for increased scrutiny and transparency in the financing process to ensure the successful implementation of the AFCFTA.
A noteworthy observation from the discussion was the caution against the exploitation of Africa's own people. The speakers stressed the importance of avoiding exploitation and ensuring that the digital economy is inclusive and benefits all individuals in Africa.
Furthermore, the influence of big tech and platforms in Africa was regarded with wariness. The speakers highlighted the need to be cautious and ensure that Africa maintains its own autonomy and control in the digital space.
In terms of inclusive digital trade, dialogue between the trade sector and the financial services sector was seen as essential. This would foster cooperation and collaboration to manage risks, facilitate innovation, and enhance digital trade within Africa.
The integration between national payment systems and digital intermediation platforms emerged as a key aspect for successful digital trade. It was highlighted that instant payment receipts are crucial in digital trade, and an enabling environment can support this integration.
In conclusion, the speakers discussed the need for a tailored approach to address the challenges faced in Africa's digital protocol and the implementation of international multilateral frameworks. They emphasised the importance of data localisation, resolving tax issues, building trust in African products, financing the AFCFTA transparently, avoiding exploitation, and being cautious of the influence of big tech. Dialogue between the trade and financial services sectors, as well as integration between payment systems and digital platforms, were considered crucial for inclusive digital trade. The IMF and UNCTAD were proposed as facilitators of meetings and dialogues to support digital trade facilitation.
Naidu Vahini
Upon closer analysis of the provided statements, several key points and arguments emerge. One significant concern raised is the belief that digital trade rules do not adequately support the development of domestic e-commerce in Africa. The argument suggests that these rules are designed to benefit foreign firms operating outside of Africa, underlining a negative sentiment towards digital trade rules. Additionally, it is mentioned that approximately 80% of African marketplaces are national marketplaces, highlighting the need for support in developing the domestic e-commerce sector.
Another important point raised is the potential impact of trade agreements on Africa's creative industry. While no specific agreements are explicitly mentioned, it is suggested that these agreements may have a significant influence on the industry. For instance, in 2022, Afrobeats tracks experienced a substantial increase in streams on Spotify, with a 550% rise since 2017. This suggests that trade agreements can play a role in shaping the growth and success of Africa's creative industry.
There is also a call for policy space within trade rules to encourage digital industrialization. It is mentioned that the United States recently withdrew its support for major trade rules, citing the need for policy space. This action is presented as evidence to support the argument advocating for policy space within trade rules.
On the other hand, there is criticism of the cross-border data transfer provision from the WTO Joint Statement Initiative on e-commerce, which is considered ill-suited for Africa. The provision is deemed to be lacking the necessary provisions for African countries to effectively use and secure their data. This criticism highlights a negative sentiment towards the current provision and calls for a better understanding of how to handle data in the context of trade agreements.
Furthermore, there are concerns about international agreements hindering the African Continental Free Trade Area (FCFTA) negotiations. It is proposed that a moratorium on trade rules should be implemented until the FCFTA negotiations and protocols are finalised. This stance indicates a neutral sentiment towards trade rules and emphasises the importance of ensuring the success of the FCFTA by avoiding potential conflicts with existing international agreements.
Implementation of Africa's policy instruments is identified as a challenge, despite the presence of numerous policy instruments such as the Agenda 2063. The statement highlights the discrepancy between the existence of these instruments and their actual application, suggesting that more efforts are needed to effectively implement them and achieve their intended goals.
The analysis also points out the need for Africa to adopt a more defined and strategic approach in engaging in multilateral platforms. It is stated that the African group in the World Trade Organisation (WTO) needs to be strengthened to reflect its decreased power, indicating a negative sentiment and a call for stronger representation in multilateral platforms.
An interesting observation is the potential benefits of shifting to African platforms for services like streaming. It is suggested that African platforms can provide better revenue for artists compared to foreign platforms like Spotify, where the revenue per stream is relatively low. This perspective highlights the potential for African platforms to promote economic growth and reduce inequalities within the creative industry.
Another noteworthy argument is the positive perspective towards the moratorium on customs duties as a significant policy perspective. The argument suggests that the moratorium on customs duties can limit market access and foster an inward-looking perspective, indicating a positive sentiment towards the potential benefits of this policy approach.
Finally, there is criticism towards Kenya's decision to negotiate a Free Trade Agreement (FTA) with the United States. It is argued that this decision contradicts the principles agreed upon by African heads of state, who had encouraged member countries to refrain from entering into agreements with countries outside of the continent until the FCFTA was fully implemented. This criticism reflects a negative sentiment towards Kenya's decision and underscores the importance of unity and alignment in African trade strategies.
Additionally, it is noteworthy that African artists, such as Davido and Rama, earn minimal revenue from foreign platforms like Spotify. The evidence provided suggests that these artists receive around 0.01 cent per stream on such platforms, indicating a negative sentiment towards the current revenue distribution and the impact it has on African artists' earnings.
In conclusion, the analysis of the provided statements reveals various concerns, perspectives, and arguments related to trade agreements, digital trade, data transfer, policy instruments, and the creative industry in Africa. These discussions highlight the need for comprehensive and strategic approaches within Africa's trade policies and underline the importance of considering the impact on domestic industries and artists when engaging in international trade agreements. Additionally, the analysis emphasizes the significance of the African Continental Free Trade Area (FCFTA) negotiations and protocols, calling for the avoidance of potential conflicts with existing international agreements until the FCFTA is finalised.
Speakers
AK
Africa Kiiza
Speech speed
143 words per minute
Speech length
2918 words
Speech time
1228 secs
A
Audience
Speech speed
135 words per minute
Speech length
959 words
Speech time
425 secs
HK
Herbert Kafeero
Speech speed
149 words per minute
Speech length
1870 words
Speech time
754 secs
NV
Naidu Vahini
Speech speed
155 words per minute
Speech length
4662 words
Speech time
1803 secs
WS
Wullo Sylvester Bagooro
Speech speed
181 words per minute
Speech length
1688 words
Speech time
561 secs
Related event
