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Africa Braces for the Fourth Industrial Revolution

Technological advancements promise to change the world, but the African continent is not yet ready for it, say experts.

Africa's Fourth Industrial Revolution

Workers are seen at the warehouse of the e-commerce platform Kilimall in Nairobi, capital of Kenya.(YANG ZHEN/XINHUA NEWS AGENCY/GETTY IMAGES)

COUNTRIES IN AFRICA ARE seeing economic progress and regional integration that could support the spread of transformational technologies such as artificial intelligence or the internet of things. Yet a deep lack in digital skills, coherent leadership and basic infrastructure could make the continent miss out on a major industrial revolution – this time with dire consequences, experts warn.

The Fourth Industrial Revolution is characterized by a fusion of the digital, biological and physical worlds, where artificial intelligence, cloud computing, robotics, 3D printing, the "internet of things" and advanced wireless technologies see increased development worldwide. This revolution promises to bring about transformative changes that Africa cannot afford to miss, say experts from the Brookings Institution in a new report.

"Failure to recognize and capitalize on Fourth Industrial Revolution opportunities, conversely, will impose considerable risks on African stakeholders," warns Brookings. "Without attempts to move beyond existing models of innovation, entrepreneurship, and digital growth on the continent, African businesses risk falling further behind, exacerbating the global 'digital divide' and lowering their global competitiveness."

While historically lagged on earlier industrial revolutions, countries across the continent have a better chance of taking advantage of the opportunities arising from technological advancements, experts say. Yet for this to happen, countries need to work together for the region's prosperity and governments need to allow for opportunities and innovation to flourish.

"(At the moment) how governments are trying to keep up with innovation is by devising policies to stop, control, and tax," says Viola Llewellyn, co-founder and president of Ovamba Solutions, a U.S.-based fintech company operating in Africa. "They actually don't know what they're doing, and so industries shrink very quickly and don't hit sustainability."

According to the Brookings report, the continent needs to ensure skills match labor demand and vice versa, enhance governance for better managing the challenges and opportunities arising, and integrate into the global value chains. Africa also needs to secure investments in basic infrastructure, experts say.

"Access to electricity in Africa is 45%," Armando Manuel, former minister of finance in Angola and World Bank alternate executive director for Angola, Nigeria and South Africa said at a panel earlier this month. "You can't develop in the darkness and you can't go to the Moon when you have constraints to go to the next corner."

Can Africa Make It?

The technology sector is far from being a top priority for African economies, analysts say. According to the management consulting firm McKinsey, African countries spend about 1.1% of gross domestic product on digital investment, less than half the share of what developed economies spend. Internet penetration is also low, averaging less than 40% compared to 62.7% in the rest of the world.

African economies not only differ from developed countries, they are also unique among their neighbors. Countries such as Kenya have far more advanced technology sectors than other African countries, with an internet penetration rate of about 90% and innovative projects such as M-Pesa that made Kenyans pioneers in smartphone payments.

On the opposite side of the spectrum, countries such as Burundi, the Central African Republic, Chad and the Democratic Republic of Congo report low internet penetration rates below 10%, with Eritrea at the bottom with only about 1% of the population having internet access.

Taking the basic steps toward a digital transformation is crucial for putting Africa on the global technology map before even considering implementing other sophisticated new forms of technology, experts say. The African population, the youngest and fastest- growing in the world, needs to develop adequate STEM skills to meet the requirements of the global market.

"Every elementary school needs to start teaching some basics of programming and coding," says Brahima Sangafowa Coulibaly, senior fellow and director of the Africa Growth Initiative at the Brookings Institution.

After completing such studies and degrees, Africans should also be able to find the appropriate opportunities on the job market.

"There are plenty of young people who have STEM degrees, but ride motorbikes for a living," says Llewellyn. "The job opportunities and the economies have not evolved to meet that expectation, STEM hasn't actually been integrated by African governments, and these very old men (in the government) who are on average 42 years older than the public don't seem to understand where the youth have to go."

Eventually, the region should support its youth to train and get the necessary skills abroad, by locating and placing talent in top economies in the world, say experts. This would not deplete the continent of talent, but rather foster talent that could ultimately contribute to their home communities.

"Remittances that come back (from youth and diaspora) boost the African economies more than anything other than internal GDP development, and far outstrip even aid and NGO money," adds Llewellyn. "The need to come back and start a business is (also) something I've seen and (now) people are developing industries at a rate that's actually really irritating the government because they can't keep up."

If adopted, digital technologies could help firms grow, and create more jobs for everyone, "not just a privileged few," the World Bank says in a report on the future of the work in Africa, but this can only happen if governments respond appropriately and keep up with the new trends.

What Will It Take?

By 2030, artificial intelligence is forecast to contribute $15.7 trillion to the global GDP. Of this, $6.6 trillion is expected to come from increased productivity and $9.1 trillion from consumption effects. For Africa to not be left behind, experts warn that there is an increased need for speedy actions. According to Brookings, governments in Africa should encourage economic growth and structural transformation, fight poverty and inequality, increase financial services and investment, and modernize agriculture and health care.

African economies should also close the gap for mobile and internet access and put in place policies for data protection and intellectual property, crucial in the age of artificial intelligence, experts say.

"(At this time) Innovation cannot be patented in Africa and a lot of inventions are patented by entities outside Africa," said Beatrice Pacunega Manano, chief of the policy analysis and monitoring branch for the Special Adviser on Africa at the United Nations.

Based on previous technological development, some voices estimate that the next 10 years will be fundamental for the African progress. Experts say it is also imperative for Africa to move faster than the rest of the world to catch up.

"It took on average 20 to 25 years to make the transition from regular phones to smartphones," says Youssef Travaly, vice president of science innovation and institutional partnerships at the Next Einstein Forum, an initiative of the African Institute for Mathematical Sciences in South Africa. "Going fast enough means at least being able to make a (technological) transition in less than 10 years."

If this doesn't happen, Africa will become dangerously dependent on outside economies, Travaly says. It will increasingly rely on new sources of energy coming from the developed world, while local economies still operating on oil will become irrelevant on the global market. Consequences will also be seen in health care, with Africans failing to tackle important medical problems with innovation that would be accessible to other, more developed regions.

"And 5G (fifth generation) is also a massive opportunity and we're going to be dependent on those technologies (coming from China)," Travaly adds. "So basically we will have a skill gap, we will have a technology gap, and we will have a knowledge gap if we don't do anything, and because of this we will have a clear prosperity gap."

By Sintia Radu, Staff Writer Jan. 23, 2020, at 7:00 a.m.


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