Andile Ngcaba’s solution to Africa’s digital lag unveiled

Against the background of a global economic squeeze, which has also affected South Africa, President Cyril Ramaphosa and his Cabinet will not regret giving Andile Ngcaba an audience.

Among a revered team of international digital gurus and captains of industry to address the prestigious Africa Tech Festival 2023 in Cape Town this week, the much sought-after Ngcaba – South Africa’s first post-apartheid era telecommunications director-general-turned-businessman – had the audience, including Communications and Digital Technologies Minister Mondli Gungubele, nodding.

It was Ngcaba’s refreshing response to a question from economist Dr Miriam Altman on whether driving a steep change in Africa’s digital enablement required finance, that had the audience clapping.

With South Africa’s internet penetration below low-capital countries like Vietnam, what needed to be done?

While Ngcaba conceded that the industry required a lot of capital, an innovative strategy – and not money – was required. “We have to be innovative in the way in which we address the digital divide gap.

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“In 2050, we will have 2.5 billion people in Africa – literally in the next 30 years we are adding another billion people,” he said.

“If we continue at this rate of investments, the gap is going to increase – requiring capital market instruments to be used to build our digital infrastructure for the next generation.

“You cannot look at a 20-year investment model with the current instruments that we see in the market today.

“One of the projects we are looking at is putting a digital bond in the market – designed on a blockchain platform – a 30-year bond to finance digital infrastructure in Mount Ayliff and other areas.

“Unless we take that long-term approach where we have purposeful capital market instruments to use in long-term digital infrastructure, we will play catch-up all the time.

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“Strategy, not money, is a problem.”

How refreshing it was to hear from the executive chair of Convergence Partners and Solcon Capital.

Informa Tech’s James Williams summed it up: “No emerging market is better positioned to take advantage of that than Africa.

“The story of African tech in 2023 has been one of new challenges – a slowing global economy and tech layoffs, which have meant start-ups have secured just 50% of 2022 investment – with reverberations across all sectors.

“The continent’s projected GDP growth for 2024 is 3.9% against a backdrop of contracting growth globally.

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“A larger, wealthier, consumer class now spends $1.9 trillion (about R34.5 trillion) a year, more than double since 2005 and expected to be $2.5 trillion by 2030.”

While by the end of the decade Africa will have the world’s largest working age population, adding 300 million workers, there is the likelihood of labour market declines in other competitive regions.

Statistics “will continue to mean very little if Africa’s workforce is not trained and skilled and if businesses and start-ups don’t have access to finance and global markets”.

In the forefront of accelerating a digital Africa, Leo Chen, president of Huawei sub-Saharan Africa, laid out how two transformative forces – digitalisation and decarbonisation – were driving humanity towards an intelligent world.

He said the infrastructure “should be more advanced, more future-proof and more inclusive and accessible”.

“Achieving the first of these simply means ensuring African countries have access to the same leading-edge connectivity technology as the rest of the world, such as Huawei’s 4G, 5G and even 5G advanced solutions.”

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