Mobile Connections Will Spur Development In Africa – World Bank Economist

“When it comes to mobile connectivity, rich and poor countries are increasingly looking alike,” a senior World Bank economist, Borko Handjiski, in a blog post this week.

According to Handjiski, growth in mobile connectivity will bring Africa closer to other developed countries by the year 2020, especially when the public sector steps in with support. 

At the moment, Africa still has the lowest mobile penetration rates than any other region.

According to GSMA, a consortium of mobile operators and companies, 39 per cent of the adult population in sub-Saharan Africa in 2014 had access to a mobile device, a rate known as mobile penetration, compared to the global average of 49.9 percent. However, as the global average jumps to 59.3 per cent by 2020, sub-Saharan Africa will be at 48.7 per cent.

“Developing markets such as sub-Saharan Africa and parts of Asia Pacific have seen mid- to high-single-digit revenue increases, reflecting ongoing strong subscriber growth in the regions with the lowest penetration rates,” according to the report. In many countries, phones have become a resource to connect people who don’t have a computer or a television to entertainment and services.

Handjiski acknowledges that a dearth of resources such as electricity, roads and medicine “makes it difficult for developing countries to produce goods and services that are energy-intensive, or need efficient land transport or a healthy workforce,” he wrote, citing World Bank data that shows just 32 per cent of the population in sub-Saharan Africa have access to electricity and just 26 per cent are able to tap into financial services. “However, in today’s modern economy we are witnessing a rapidly expanding array of services with mobile technologies as their backbone,” he noted.

Africa currently has the smallest portion of adults who have access to a banking institution. But in January analysts at Frost & Sullivan predicted that the mobile-payments market in the region could be worth $1.3 billion by 2019. The projected growth could be the key to solving this financial inclusion problem.

Banks are moving online, retailers are moving online, entertainment services are online; governments are not,” Handjiski wrote, recommending that officials should focus on using mobile networks to help citizens access services such as education. A new reliance on telecommunications infrastructure could help businesses and citizens bypass older systems, which are often riddled with corruption.

“Developing-country governments need to continue to work hard to fill their infrastructure gaps in order to move up the development ladder, but at the same time they can capitalize now on their greatest infrastructure asset — mobile phones. They are too great of an opportunity to miss.”

NP/ibtimes