The future is looking rosy for Africa, with infrastructure – driven by the mobile telcos – starting to make an impact in attracting investment and new development.
Announcing the results of IBM's recent Global Innovation Outlook (GIO) focused on investment in Africa, IBM's GM for sub-Saharan Africa, Mark Harris says he is very hopeful for the future in Africa.
The GIO examined eight areas: value chain, infrastructure, wireless, skills, the informal economy, the role of women, finance and non-governmental organisations.
Harris says the study found that many sectors of the African economy have seen the need to move up the value chain.
“There are vast natural resources in Africa,” he says, adding that many of these resources are still exported while finished goods are imported.
For example, 10% of the world's crude oil is produced on the West coast of Africa – but Nigeria imports refined oil.
“There are resources like diamonds which are sent to Belgium to be polished and cut because we can't do the beneficiation in Africa.”
By bringing beneficiation closer to where resources are produced, Harris says governments and companies in Africa are realising that skills can be increased and obs created in their own countries.
Infrastrucure is vital to attracting investment and helping economies to move up the value chain.
African countries are starting to realise that the have to build infrastrucure and there are a number of projects underway, including the installation of undersea cables and fibre optic networks.
Currently, only 2% of Africans have access to electricity and 3% have access to telephony.
“This has an impact on economic development,” says Harris.
One technology that has had arguably the biggest impact in Africa is wireless.
“People thought the mobile telcos were mad to go into Africa,” Harris says. “Yet they have transformed the whole of Africa.”
He points out that while mobile operators entered the African market to tap into the human capital, their services have spawned any number of applications and business opportunities.