Africa’s Internet economy has the great potential to reach $180 billion by 2025 according to the e-Conomy Africa 2020 report by Google and the International Finance Corporation (IFC). Currently, the digital economy contributes nearly $115 billion to the continent. The sector is expected to grow to $712 billion by 2050.
This would differ from an earlier 2013 report by McKinsey which estimated an annual 40% growth in the continent’s digital economy to reach over $300 billion by 2025 on the back of massive mobile penetration, among other technologies.
Internet access has in recent years brought transformation to the African continent. According to the e-Conomy Africa 2020 report, since 2000, the number of people with Internet access has grown to over 520 million, or 40% of the population; and 60% of the population accesses the Internet via mobile.
Much progress has occurred between 2010 and 2019 with more than 300 million Africans gaining access to the Internet, Increasing Internet access to reach 75% of the population could create 44 million jobs.
Kenya leads all African countries in iGDP potential (which is the contribution of the internet economy to GDP). It is estimated that the internet economy will contribute $7.2 Billion to Kenyan’s GDP in 2020, representing 7.70%. By 2050, it is projected to contribute up to 15.17% of the GDP.
As per the report, A 10% increase in mobile Internet penetration increases GDP per capita by 2.5% in Africa, compared with 2% globally. Zimbabwe has an internet penetration of over 62% according to a 2019 POTRAZ report but the contribution of the GDP remains in the doldrums
Africa has a talent pool of 700,000 professional developers who are fueling the rapid expansion of the internet economy. The continent’s Fintech companies, E-commerce firms, Healthtech sector, Media and Entertainment industry, and E-mobility companies are also leading in the digital transformation. A key gamechanger is the much anticipated African Continental Free Trade Area, the world’s largest single market which is expected to create more value for Africa
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