Africa’s internet economy is projected to reach $180 billion by 2025, increasing from $115 billion in 2020, thus creating new job opportunities and contributing significantly to Africa’s GDP.
Dr. Jumoke Oduwole, Nigeria’s minister of Industry, Trade and Investment said that the country remains a leading force in the ‘Africa’s Digital Trade Revolution’.
In her recent article shared by the African Media Agency (AMA), Dr. Oduwole said;
“Digital trade and trade in services are recognized as key drivers of Africa’s economic transformation, helping to diversify economies, increase competitiveness, and improve productivity”.
She emphasized:
“The African Continental Free Trade Area (AfCFTA) is expected to catalyze the creation of new job opportunities across various sectors, including services, manufacturing, and agriculture through regional trade.”
This aligns with a World Bank report highlighting that increased internet accessibility has the potential to drive job creation across African countries. AfCFTA is expected to play a significant role in the creation of new job opportunities across various sectors.
To achieve this, AfCFTA focuses on reducing trade barriers, cross-border investment and also aims to create a dynamic trade environment by expanding manufacturing bases and adoption of the Digital Trade Protocol.
This protocol aims to unite digital trade across member states, thereby reducing barriers and fostering a conducive environment for digital innovation, with the internet services sector contributing more to African GDP.
The Minister of Trade also identified the contribution of fintech, the creative economy, and e-commerce to the continent’s development, adding that:
“Digital finance, e-health, and e-learning are also growing rapidly in Africa. Driven by the increasing adoption of digital technologies and the need for innovative solutions to address the continent’s development challenges. Companies like Andela, valued at $1.5 billion, which provides remote work opportunities for African software developers, and Esusu, valued at $1 billion, which offers credit building services for tenants, are examples of this growth.”
However, several challenges have impacted the development of the digital economy. This includes regulatory fragmentation, inconsistent standards across borders which make it difficult for digital service providers to operate seamlessly across different countries, limited access to financing for digital services, and cybersecurity concerns.
To address these challenges and ensure the continuous growth of the digital economy, various solutions are being implemented.
“AfCfTA is currently harmonizing regulations and standards across the continent, facilitating the growth of digital trade. Also, initiatives like Afreximbank’s Pan-African Payment and Settlement System, the AfDB’s Digital Africa Initiative and World Bank’s Digital Economy for Africa initiative are working to improve digital infrastructure, enhance digital skills, and promote digital inclusion”, the Minister of Trade said.
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