Amina and Yakubu grew up in the northern part of Nigeria in the 1970s. In early childhood, they experienced one of the worst droughts. They lost the quality of their infancy experience to poor nutrition due to the persistent drought in their childhood locations.

Amina, now unemployed, was conceived during the drought and lived it as a baby. This famine hurt her parent’s income and her mother’s nutrition. Yakubu, with limited labour market opportunities, recounts that the climate crisis made it difficult for his family in the rural area to foster their seasonal crops and rear their herds and livestock. Many members of his community lost thousands of herds due to this drought. Amina and Yakubu are fictitious characters. Yet, they represent the stories of thousands of persons born in the early seventies in northern Nigeria and who experienced the drought’s consequences.

How could one imagine that varying environmental conditions in early life could affect adulthood’s labour market outcomes? In developing countries, this is not far-fetched. The impact of climate shocks can be long-lasting for vulnerable, exposed groups. It is especially true in countries where the effects of climate change are severe, and the resources needed to cope with its consequences are scarce.

The 1972 – 1974 drought that affected the areas in Nigeria where Amina and Yakubu lived provides an appropriate case study. It is argued that it may have affected later labour market outcomes of those exposed to the shocks at the early stages of their life’s formation. How?

The consequences

The 1972-1974 drought is labelled the worst in recent Nigerian history. Affected areas saw a 60% reduction in farm production, 400,000 cattle deaths, a 13% decline in livestock population, and a 400% increase in food prices. The death of millions of animals and crop failures of between 80 and 100 % in certain affected areas had severe repercussions for women. They depended primarily on farm output for trade and subsistence.

Children born in periods coinciding with the droughts suffer the most severe effects from the climate shock’s economic and nutritional damage. The pre-and early post-natal age group is sensitive. Thus, current circumstances that affect stress levels and nutrition modify their condition for quality development. These circumstances have a lasting impact on the quality of later life. Other infants born in the period immediately before and after the drought are not left out, as the group still coincides with the formative stages of life. Since the group’s formative years coincided with the drought, its implications on household income and health indirectly impacted their healthy development.

Households who depend on agricultural products face a more significant impact, especially those in states more vulnerable to drought. In addition, rising food costs also impact non-agricultural households, affecting their food consumption (not to mention the direct health consequences of the famine). Such shocks to household finances, food intake, and health collectively account for infant stress. It hurts the Intelligence Quotient (IQ), later educational performance and attainment, health, and overall mental health. Such effects on human capital development are expected to impact the adult labour market, with “social consequences”, such as earlier marriage entry.

In contrast to Yakubu, Amina’s labour market risk may have been caused by her childhood household response during the drought. In other words, boys’ schooling takes precedence over girls in times of household economic hardship. Such gender-based reactions to shock incidence in families’ investments in their children’s education are usual in this part of the world. Despite their early life shock exposure in common, such differences in households’ resource allocation between boys and girls may affect outcomes in the long run. It could also be because of the pervasive barriers women face in entering the labour force compared to their male counterparts.

What can be changed?

The drought altered Amina and Yakubu’s early life, but Amina was also affected in adulthood. It tells us that a gender-focused policy approach is needed to address the differences in outcomes despite common life experiences. Policymakers and other public sector actors should be gender-intentional in policy designs to lessen adverse climate change impacts on the most vulnerable. A fundamental policy, for instance, could focus on attending to the nutritional deficiencies of pregnant women faced with climate shocks. Policies can also focus on mitigating the consequences of school interruption or human capital deficiencies that may have occurred due to climate change shocks, especially for the most vulnerable.

For people like Amina and Yakubu, these interventions might come too late. But in the light of rising climate change threats and increasing droughts, it is essential to mitigate the long-term effects for future generations around the globe.

This article was Co-authored by Great O. Nnaamani

In 2020, Nigeria’s population was estimated to be above 200 million and about 61 percent (122 million) of the population were within the working age. Out of the 122 million in the working age group, 69.7 million are in the labour force and a significant proportion of them are without a job. The most recent unemployment statistics (2020Q4) shows that 33.3 percent of the labour force are unemployed and another 22.8 percent are underemployed. The situation is, however, worse for the young population (those between the ages of 15 and 34 years) as 42.5 percent are unemployed and another 21 percent are underemployed. Similarly, the unemployment situation is higher among those without education as well as those with minimal education as the unemployment rate among those that have not attended school and those with primary school education is 31 percent and 24 percent respectively, relative to 17 percent for those with post-secondary education (see Figure 1). With Nigeria’s population estimated to reach 250 million people by 2030, the unemployment situation is increasingly drawing the attention of relevant stakeholders as the country’s ability to create sufficient jobs for new entrants as well as those in the labour market is undermined.

Figure 1: Unemployment in Nigeria by Level of Education

Source: Authors’ computation from National Bureau of Statistics

IWOSS: the potential solution

The sluggish growth of Nigeria's manufacturing sector, which otherwise would have absorbed labour, has limited employment creation in the country, as it has in many other African nations. Recent studies highlight alternative industries, referred to as "industries without smokestacks'' (IWOSS), that have many similarities to manufacturing including their tradability, propensity to absorb significant numbers of low-skilled labour, potential to significantly contribute to output, and high productivity. Industries without smokestacks include tourism, horticulture, business services, trade, transportation and logistics, and some information and communication technology (ICT)-based services. In Nigeria, the IWOSS sector is quickly gaining prominence and contributing increasingly to employment from 17.6 percent to 24.9 percent of total employment between 2010 and 2018 (see Figure 2). Hence, the development of the IWOSS sector has the potential to generate an appreciable number of employment opportunities for Nigerians, especially the youths.

Figure 2: Employment in Nigeria: IWOSS and Non-IWOSS

Source: Authors’ calculation based on GDP estimates from the National Bureau of Statistics

IWOSS sectors: employment creation channels

Despite the role of IWOSS sectors in delivering jobs for the population, employment creation in the IWOSS sector is premised on three factors. First, the transition towards climate friendly activities will create new jobs. Also, technological advancement is resulting in new forms of jobs that were not in existence two decades ago and traditional jobs are eroding. Finally, the African Continental Free Trade Area (AfCFTA) is expected to increase the growth of new industries in African countries including Nigeria as well as increase demand for the services of existing ones.

Industries without smokestacks (IWOSS) by definition are low CO2 emitting industries. In CoP26, there was a renewed commitment by countries including Nigeria to net zero carbon emissions by 2063. In line with this pledge, Nigeria’s National Development Plan included the green economy as part of the five trends that would shape the world in the next decade. As a result, the Plan provided strategic support for the expansion and emergence of environmentally friendly industries. For instance, the Plan projected the increased use of smart techniques in agriculture. Simply put, commitment towards net zero carbon emissions would lead to the winding down of existing jobs and emergence of new jobs particularly jobs in industries that support the green economy. On this basis, government and business leaders are already making concerted efforts to create new industries that are environmentally friendly.

Moreover, structural change is taking place globally and these changes reflect the impact of technological progress and a changing global marketplace prospect of industrialization. The World Economic Forum identified five high in-demand roles, which are (i) IT and data, (ii) sales and marketing, (iii) operating and logistics, (iv) manufacturing and production and (v) customer facing and front office. Four out of the five identified job roles are related to IWOSS thus, indicating that the job of the future would be found in IWOSS. These opportunities IWOSS offers could be tapped into and accelerated if the Nigerian government amends policies to pave the way for greater investments into the IWOSS sector.

Nigeria has long sought to increase its industrial capacity as a way of harnessing the benefits presented by the AfCFTA, generating employment opportunities, and stimulating GDP growth. The IWOSS sector presents exciting earnings that are geared towards expanding Nigeria’s industrial capacity.  The AfCFTA, which was launched on January 1, 2021, integrates 54 of the 55 African Union members, creating a market with a combined GDP of $3.4 trillion. It aims to create a single market for goods, services, and the free movement of labour, and it intends to abolish tariffs on 90 percent of the goods produced in the region. The implementation of the agreement is expected to enhance cross-border financial transactions, expansion of the agro-processing businesses, and increase the demand for transportation and logistics services. Significant number of jobs are expected to be created in these industries with implementation of supportive policies in line with the AfCFTA.

Imperative for Nigeria: the four C’s

To leverage the employment potential of the IWOSS sectors in addressing Nigeria’s employment challenges, these sectors require support from the government. Four ways have been identified through which IWOSS sectors can be supported. 

Competitive educational system

In Nigeria, the educational system is underperforming and less competitive. As a result, the students are poorly prepared for the in-demand skills. Except for a few educational institutions, the curriculum which serves as a manual that guides teaching are rarely updated. This phenomenon occurs at every level of education and in part explains the existing skills mismatch between the skills demanded by employers and the skills profile possessed by students graduating from educational institutions. The magnitude of the problem is high due to limited collaboration and coordination between educational and training institutions as well as various industries.

The government needs to provide a framework that strengthens the flourishing of a competitive education system. This is important in ensuring that students are taught in-demand skills. In other words, the educational system prepares the students with skills necessary for them to be competitive in the job markets. Also, the learning structure includes internship positions to intimate the students with industry demands.

Commitment to improvement in infrastructure

Nigeria’s infrastructural deficit is enormous and constitute a drag to economic growth and development. Recent evidence suggests that Nigeria still lags and needs to intensify efforts to improve its digital economy. In Nigeria, digitization opportunities are limited in a variety of ways. Some are the result of deficiencies in digital infrastructure and digital skills, while others relate to how the digital economy is controlled. In other words, the existing deficiency in digital infrastructure has constrained the competitiveness of Nigeria's e-commerce and logistics business, thereby lowering the extent to which they can expand, and suggesting that there are ample rooms for growth. In addition, the power and transportation are grossly inadequate and affects the efficiency of firms. Commitment to improve infrastructure should therefore include the power and the transportation infrastructure. The power sector infrastructure should aim at simultaneously expanding the country’s power generating capacity and transmission. Similarly, the investment in transportation is crucial in reducing congestion at port and commuting time, which indirectly increases the cost of doing business in the country. These interventions can transcend to positive IWOSS sector productivity. Governments, policymakers, and key stakeholders should collaborate to increase investment in infrastructure.

Coordination of climate actions

The Paris Agreement and Sustainable Development Goals emphasised environmental sustainability when describing economic growth. As a result, the direction has shifted from economic growth to sustainable growth or a green economy. While the green economy was incorporated in the National Development Plan, the government needs to create a structure that will ensure that the private sector acts in a coordinated way. In other words, the activities of the private sector targeted at achieving net zero carbon emissions needs to be coordinated to prevent repetitive activities and optimise actions towards achieving the goal. For instance, the government has to work more closely with the private sector and research institutions in creating knowledge aggregating platform and events to ease the dissemination of climate related information. These platform and events would create opportunity for different actors working on climate change adaption and mitigation strategies to have up-to-date information on new development, especially those within the country.

Creation of innovative financing options for MSMEs

Small businesses are the engine of economic growth and are very crucial in fostering job creation in the IWOSS sector. Recent evidence suggests that, in 2020, Micro, Small and Medium Enterprises (MSMEs) constitute about 96.9 percent of total number of businesses and contributes about 46.3 percent of the total GDP. However, their growth has been hindered by lack of access to finance with significant share of small business owners relying on their personal savings and borrowing from friends and family to support business operation. Small businesses account for less than 5 percent of commercial bank credit, which contributes in part to their financing gap estimated at about N617.3 billion annually. While there are existing funding schemes targeted to MSMEs, their scale of operation is very limited. Addressing financing gaps among the MSMEs is crucial in optimising their contribution to job creation, otherwise, firms with potential remain small or die within few years of establishment. The Development Bank of Nigeria, Central Bank of Nigeria, and Small and Medium Enterprises Development Agency of Nigeria need to partner with financial institutions to design additional innovative financing schemes (and expanding already existing ones) that would provide MSMEs with finance at scale and at affordable rate. The financing scheme should be designed in a form of cooperative structure such that the beneficiary of the funds is accountable to other cooperative members.

Conclusion

In the National Development Plan, 2021 - 2025, the Nigerian government aims to create 21 million jobs by the end of 2025 through the private sector. This article makes a case about the capacity of the IWOSS sectors in driving employment creation in Nigeria, and the need to prioritise it. While the evidence about the IWOSS sector in Nigeria is scarce, this piece highlights the potential of the sector in addressing the employment crisis in Nigeria. As a result, the article notes four imperatives to upscale the impact of the IWOSS sector. They are (i) competitive educational systems, (ii) commitment to improvement in infrastructure, (iii) coordination of climate change actions, and (iv) creation of innovative financing options for SMEs. These actions would go a long way toward enabling the IWOSS sectors to catalyse employment creation.

Today, the increasing value of digitalisation and data to global development has received widespread attention. A great number of structural transformations have been driven by means of digital technologies. Digital technology has provided a marked boost to world economic output and created innumerable jobs. Following the recent COVID-19 disruption on the global scene, many other developmental impacts that digitalisation can perform have actually come to the fore. Data, the resource that drives digitalisation, has been figuratively described as ‘the new oil’, and its commoditisation necessitates a reliable data governance framework to make it retain its value. Data governance has the potential to enhance data value, as well as safeguard data-related harms/threats.

The big platform-based firms, regarded as ‘Big Tech’ monopolies that are established in Europe, the United States and China have dominated the global digital market space and their data governance models are defining modalities for interaction and trade in the digital space. For example, most African countries have modelled their respective national standards of data protection after the EU’s General Data Protection Regulation (GDPR). Consequently, the presence of these dominant players has made the global digital economy imperfect, as they tend to reap the most benefits from the digital economy, leaving less for developing economies like Africa. This imperfection has the potential to limit the gains to Africa from digitalization. Its digital economy is imperilled by highly worrisome threats which are causing a  crisis of trust in the digital space.

• Africa’s efforts in the fast-rising global digitalisation era

There is obviously no gainsaying that Europe, the US and China, as formidable digital governance models, have each made their mark in the global digital economy. Data, in the hands of these digital economy tsars, has been utilised for multidimensional purposes, such that it is now crystal clear that the use of data does not have implications, only for trade and economic development but also for human rights, peace and security. These nations’ approaches to governing the digital economy, and the regulatory frameworks developed by them to manage cross-border data flows truly distinguish them as the digital economies to beat. On its own, the United States, has an innovative entrepreneurship approach which promotes the private market-driven initiative in the global digital market. Through its liberal regulatory framework for cross-border data flows, the United States has succeeded, quite remarkably, in bringing about far-reaching innovations which have enabled it to maintain its leadership position in the global digital market. While China has a sophisticated blend of both security-oriented and digital development-oriented approaches, the European Union has human rights-oriented approach. While still building a multilateral support for its data governance model, the EU has demonstrated commitment towards championing the cause of digital justice for the victims of digital harm. One amazing outcome of this initiative is the mitigation, to some extent, of the risk of abuse and misuse of data in the digital space.

Notwithstanding the giant strides which these digital governance models have taken in their respective approaches to digital economy, each of them (the models) is not without its shortcomings, which is why Africa needs to look beyond patterning its own digital economy approach after any of them. Basically, each of these models, in its manner of approach, reflects the contextual peculiarities of its economy. If not properly controlled, the United States’ free-market approach that Africa has been trying to replicate, will remain a wind that blows no economic good. For example, Africa has yet to develop a strong data governance framework capable of ending the current digital market inequality, whereby private companies and platforms enter the digital market and reap all the economic gains of the data economy, with little or no constraints. This type of development has made the African digital market susceptible to a wide range of threats and poor competition which are the bane of the continent’s long overdue structural transformation. So, for Africa to emerge as a digital market leader, it must do its  best to look inwards. For instance, there is a domestically unique way in which Africa can coordinate the private sector for strategic expansion in the digital space.  It is crucial for the continent to channel its data governance pillars towards supporting local or domestic experimentation of ideas that will  essentially drive its digital transformation. The truth is, Africa can leverage its enviable status as a champion of mobile technology to harness the potential of digitalisation for its economic transformation.  

• Africa’s steps towards being digitally governed

Africa needs to steer its states towards addressing, very thoughtfully, the issue of data protection legislation. Each of these states, in its own space, must demonstrate unflagging commitment towards enacting data protection and privacy laws which would regulate its domestic digital market. Data, as the ‘new oil’, must be effectively commoditised by the means of a well-thought-out and context-sensitive regulatory framework for its values to be unlocked in each state and, by extension, Africa. If the commoditisation of data is not effectively regulated by laid down laws, there are bound to be unhealthy outcomes. But how can effectively regulated commoditisation of data be ensured when there are still many African states that have yet to pass their respective data protection laws and regulations? The truth is that, for the African continent to have very strong data protection, all  policymakers and the private sector in each African state must, collectively work together. There must be collaborative efforts between them to create regulations and put in place  measures to ensure compliance with such regulations. In this regard, regulatory agencies need to be set up and  empowered to discharge their statutory duties very efficiently.  In addition, data policies which can guarantee best practices in the business of generating, storing and using data should be formulated, as well as well-monitored mechanisms for implementing these policies

Furthermore, African states must support the African Union (AU), the umbrella body for all African states, in its concerted efforts towards facilitating trust in the digital space, promoting regional digitalization and accelerating the achievement of the African Continent Free Trade Area (AfCFTA). Another impediment to the continent’s economic transformation , is the crisis of trust in the African digital space. As the strategic institutionalisation of intra-regional trade in Africa, AFCFTA necessitates  the development of an effective regional data governance framework. In the few African states where efforts have been made to enact a legislation/legal framework for data protection and privacy, the implementation of such legislations appears to be disparate, lacking a unified approach. Suffice it to say that Africa as a region has yet to produce a centralized data legislation which generally supports the concept of data protection in all states. While the AU Malabo Convention on Cyber Security and Personal Data Protection (the  comprehensive document which covers electronic transactions, privacy, and cyber security) promises to bridge this gap, the ratification of the outcomes of the Convention has not been fully achieved by the required number of states.

• Conclusion

African digital transformation is a catalyst for sustainable regional growth and development. The time for the continent to rise above the tide of economic backwardness, technological obscurity and digital inequality is overdue. Africa needs digital transformation which will grow economies, improve  service delivery and produce jobs and incomes for human survival. To improve digital revolution and inclusion, the necessary environment must be created. This development would stimulate organisations, businesses, institutions, and governments to move their operations, processes and practices to the digital space. When digital technologies are exclusively utilised to guarantee the provision of products and services, the expansion of existing services, generation of revenues and exploitation of opportunities for all, achieving transformation becomes seamless. To make all these possible, all  African digital economy stakeholders and change-makers must create the change needed for digital transformation to occur.

This blog was written by  Kunle Balogun

‘Tobacco use is killing us and our planet’! Annually, tobacco use kills about 8 million people globally and 29,000 people in Nigeria. The economic costs of tobacco attributable disease on the Nigerian economy is estimated at US$1.71 billion per annum including the direct and indirect costs of tobacco. Tobacco smokers’ life expectancy is at least 10 years shorter than that of non-smokers. Exposure to second-hand smoke is a serious health hazard causing more than 41,000 deaths annually. Pregnant women who are exposed to secondhand smoke are more likely to have a complication before and after child delivery. Children are not immune to this danger; each year, 150, 000 children under the age of five are killed by secondhand smoking. The deleterious effect of tobacco extends to smokeless tobacco,  also a known cause of cancer. The nicotine in smokeless tobacco increases the risk of sudden death due to irregular heartbeat (ventricular arrhythmias).

Tobacco use is not only killing people, it is poisoning our environment! Tobacco endangers the health of the planet with an environmental burden of 600 million trees cut down annually for tobacco production, 200 000 hectares of land cleared, 84 million tonnes of CO2 emitted, and 22 billion tonnes of water consumed. Moreover, agrochemicals used in tobacco cultivation poisons the land, soil and water, and tobacco production saturates the air with tonnes of toxins. Cigarette smoking alone pollutes the air ten times more than gas emissions. In the year 2019 alone, about 4,211,962 cigarette butts were collected from beaches and waterways globally. This implies that tobacco butt is the second most common type of environmental litre after food wrappers. The cigarette butts contain toxic chemicals such as nicotine and heavy metals which endangers aquatic life and microorganism. 

Tobacco Taxation can mitigate these challenges

Tobacco taxation, passed on to smokers in the form of higher cigarette prices, has been acknowledged not only as one of the most effective control strategies for decreasing smoking and its adverse health consequences but also as an effective strategy for reducing the environmental burden of tobacco. Unfortunately, tobacco tax as an effective measure which encourages smokers to quit and prevents others from taking up smoking is the least effective in Nigeria. This ineffectiveness majorly is a result of the low tobacco excise tax rate. In addition, despite the magnitude of the health and environmental burden of tobacco consumption in Nigeria, the overall performance of tobacco tax policies is very poor. The recent 2018 special excise tax on tobacco products only raises the excise tax burden from 12 percent to an estimated 17 percent. This is contrary to best practices and far below the ECOWAS and WHO recommended benchmark of 50 percent and 70 percent respectively. The current tobacco tax structure in Nigeria is too low to discourage tobacco use and protect the environment.

Poor quality tax governance in terms of accountability, responsiveness and sound public finance management is one of the underlying causes of Nigeria’s ineffective tobacco tax system. The tobacco industry takes advantage of the administrative loopholes to undermine tobacco tax reforms. Strong tax administration as well as improving enforcement capacity enhances the impact of higher tobacco taxes (WHO).

Moreover, tobacco industry interference posed a challenge in implementing effective tobacco taxation in Nigeria. The Tobacco industry is one of the booming industries in Nigeria. Domestic market share is around 66 percent, imported market share is approximately 24 percent and illegal market share accounts for 10 percent of tobacco market supply in Nigeria. Given its vast resources and market power, the tobacco industry is a powerful force that is not deterred by government actions. The tobacco industry employs several strategies to influence policy and postpone regulation. Delaying tobacco control laws and authorizing new tobacco products are all examples of these interference. Nigeria's legislative authorities should be active to ensure that the tobacco industry does not play a decision-making role in tobacco legislations.

Increased tobacco taxation and an effective tobacco taxation system should be elevated by the government as top health policy priority in Nigeria. The key viable elements to address the weak tobacco tax system in Nigeria are (i) implement a broad-based, uniform tax that is difficult to avoid (ii) extend regulations and tax policy on tobacco products and sales to eliminate single-use filters and reduce post-consumption waste. (iii) beware of tobacco industry interference and (iv) earmark tobacco tax revenue to improve public health and safeguard the environment. Nigeria's national health systems require a paradigm shift away from fragmented response approach and toward more improved systemic approaches. This could significantly increase funds for health care, improve environmental conditions, enhance public trust, accountability and welfare.

Digital innovations are advancing at a rapid pace, connecting businesses, individuals,  governments around the world and creating exciting opportunities. These opportunities provide numerous benefits and major gains in terms of structural transformation for the majority of economies. However, African economies are yet to benefit from these opportunities.

The global digital market is generally uneven and imperfect, with African countries contributing little to the market's value creation. For example, in 2017, ICT export from Africa stood at approximately four percent globally. Also, accessibility to the internet remains minimal in Africa, with about 47 percent of the continent's population having access, compared to a global average of 63 percent. The issue of digital skills shortages, high-cost structures and deficits in ICT infrastructure are also among the key challenges facing Africa’s digital economy. As a result, it is estimated that most African countries are poorly prepared to capitalize on global digitalization.

Since many African economies continue to struggle with institutional and structural challenges that impede digital adoption and growth, the economic benefit of digitalization remains disproportionate — concentrated  in a few comparatively better-off economies. Closing this digital gap is crucial for preventing many African countries fromfalling behind in the digital space.

Understanding the level of digital preparedness and development across various facets of African economies is the starting point for developing suitable intervention policies. Hence, the Centre for the Study of the Economies of Africa (CSEA) has developed a series of indicators for tracking African countries' digital preparedness, digital development, and data governance regulations. This is known as the Digital Governance Portal.

The Digital Governance Portal has a user-friendly interface that makes it simple to navigate. In addition, datasets and methodology notes are open to the public for download in excel and portable document format. The Portal allows users to visualize digital and data governance indicators over a period, gain access to presentation-ready maps and conduct comprehensive analysis on national and regional levels. 

The Digital Governance Portal

The Digital Governance Portal, a one-of-a-kind portal about the African digitalization space, collects data on digital indicators from a variety of sources. It demonstrates how African countries have advanced in their digital transformations. The Digital Governance Index reflects the trajectory towards building an inclusive digital economy and serves as a resource for policymakers. The Portal is built on three pillars that capture African digital evolution and progress.

First is the Digital Preparedness pillar, which measures an economy's readiness to transit to a digitized world, which is facilitated by improved digital skills, ICT infrastructure and business dynamism. This pillar assesses a specific set of indicators (education, infrastructure, business, regulatory and macroeconomic) that make it easier for a country to integrate, apply, and develop digital technologies locally and within the global value chain that revolves around the ICT sector. The second pillar is Digital Development, which provides specific digital indicators on the depth of development of the country's digital space.

Among the indicators covered in this pillar are the e-government index, the ICT development index, and the proportion of households with access to the internet and computers. Finally, the Data Governance pillar describes the processes, laws, and regulatory framework available for managing the availability, usability, transfer, integrity, and security of the digital space within a country. On each pillar, users have access to statistics on several sub-components from over twenty individual sources covering 38 African economies.

Figure 1: The Digital Governance’s Pillars

Zoom in on the Digital Preparedness Pillar

The summary of African countries performance on the Digital Preparedness pillar is summarized in Figure 2. The highest ranked country is Mauritius with a score of 0.66, while Chad has the worst performance with a score of 0.32. The average score on the Digital Preparedness Index among African economies is 0.47. No country obtained a perfect score of 1 on the Digital Preparedness Index. There are 54 African countries, however, from the data on the digital preparedness index, data is only available for 36 countries which can be viewed on the chart below.

Figure 2: Digital Preparedness in Africa

Zoom in on the Digital Development Pillar

The Digital Development Indicator shows that only 11 percent of African households have access to a personal computer. Also, Africa has an average speed of 6.09 kilobit per second of International Internet bandwidth. In relation to the extent to which businesses in Africa use ICTs for transactions with other businesses, Africa has an average of 4.13 points out of 7 points, indicating an average performance. Also, the heat map (See Figure 3) indicates a strong ICT usage by businesses in West Africa and Southern Africa economies than in other regions. 

The top countries in terms of access to digital technologies are Seychelles (52%), Morocco (43%), and Mauritius (41%). In addition, Kenya, Tunisia, and South Africa are the top African economies with the fastest international internet bandwidth of 23.72kb, 18.75kb, and 18.11kb, respectively. Again, the information elicited from the data points to a few top-performing countries and large underperforming countries, which is a pointer to a high digital divide similar to those observed between developed and developing countries.

Figure 3: Digital Development in AfricaSource: Centre for the Studies of Economics of Africa

Zoom in on the Data Governance Pillar

On the Data Governance pillars, 61 percent (33) of African countries have legislation on privacy and data protection. A similar regional approach to data privacy, the Malabo Convention, has only been ratified by 7 countries.  Also, only 33 out of 54 African economies have existing legislation on electronic transactions, and 46 per cent have laws regarding consumer protections. Data governance is the core instrument to deliver sustained and robust digital development, yet the data from the Digital Governance Index point to Africa’s modest progress in these areas.  The preceding analysis points to the diagnostic and descriptive power of the Digital Governance Platform to policymakers and other stakeholders in Africa.

Figure 4: Data Governance in Africa

How To Galvanize Digital Development in Africa

Statistics from the three pillars (Digital Preparedness, Digital Development, and Data Governance) suggest that Africa still lags and needs to intensify efforts to improve its digital economy. In Africa, digitization opportunities are limited in a variety of ways. Some are the result of deficiencies in digital infrastructure and digital skills, while others are how the digital economy is controlled. Considering these issues, policymakers and stakeholders in the digital economy must collaborate to make decisions that can harness the potential of digitalization to spread its benefits more equitably and empower the economy to combat rising inequalities. To remedy this, governments and policymakers can prioritize digital skill development in their various countries. Evidence suggests that there is a strong need to develop such relevant skills and other related competencies for the African economies to participate actively in the digital economy.

It is also critical to strengthen digital infrastructure. So far, the scope and pace of the direct benefits of improved access to the Internet and related digital technologies on local economic development in most African nations have been modest. Therefore, it is critical to provide access to steady Internet in digitally-enabled sectors in order to support more value creation in the digital economy. Similarly, collaboration and investment partnerships with more advanced digital economies and private sector actors will provide Africa with access to capital and digital technicalities/resources for long-term digital infrastructure development. 

Developing and implementing a legal regulatory framework for digital space control is essential. Unfortunately, many African economies lack the regulatory environment required to support digital development. A good starting point would be to initiate a regulatory gap assessment, which would constitute the basis for a comprehensive approach to formulating laws and regulations for the digital economy, and then incorporate baseline digital legislation or update  relevant regulations in accordance with global best practices.

Finally, boosting techpreneurs will act as a driver for digital economy growth in Africa. Gaining the most out of the digital economy involves strengthening the digital sector and initiatives that allow businesses from all sectors to take more advantage of digital technologies. In many African economies, the usage of ICTs by businesses, particularly micro and small businesses, is still minimal. With rising levels of digitization in several sectors, including agriculture, energy, health, e-commerce, and electronic payment, techpreneurs have a lot of potential to develop innovative digital solutions for those sectors. Firms that invest in and use digital technologies are more productive, innovative, and lucrative.

Final Remarks

Digital development could be the game-changer  for the African continent. It has the potential to  boost economic development and industrialization while also improving the business environment and alleviating poverty. Thus, Africa’s digital economy must improve. To improve the performance of the African digital economy and maximize the potential of digitalization, governments, policymakers, and key stakeholders should  collaborate to establish soft/hard digital infrastructure as well as a favourable regulatory environment for private sector investments and data protection. 

Beyond policy collaboration, the CSEA's Digital Governance Portal will act as a tracker for digital evolution in Africa. This will provide  annual trends and snapshots of Africa’s digital preparedness, development, and data governance. In addition, it keeps policymakers and governments up to date  on  current events in Africa's digital space.