Digitization, a catalyst to the exponential growth of African Small Businesses
September 28th, 2020 – The year 2020 came with lots of hopes and expectations for individuals and businesses, interesting economic projections across most of the world’s thriving industries, a landscape of growth and meaningful insights for what seemed like the most productive year ahead, leading onto the end of yet another decade.
What many did not envisage however, is a global public health emergency – the worst economic downturn since the great depression as described by the International Monetary Fund, a truly global crisis where no country is spared.
Evidently, the impact of the Covid-19 has significantly hindered economic and social development across Africa, with individuals and businesses having to unlearn and learn new changes in lifestyle habits, business restructuring, adoption of innovation and technology and most importantly digitization in the way people live and work. In the last few months, the pandemic have now become a situation countries and people have to live through, with the hopes of an economic recovery.
If Africa is to recover, then a spotlight on small businesses, which make up a large percentage of global and local economies, will be pivotal to this transitioning. This business-led recovery will majorly revolve around digital technology; a catalyst for inclusive growth.
But how do we enable African SMEs to become digitally enabled? Clearly, the introduction of technologies can improve SMEs’ productivity, growth and improve quality of life for consumers, in regards to convenience. According to data from the World Bank in the Foresight Africa 2020-2030 report, GDP growth in the continent could increase by 2% per year if the African Union’s goal of universal and affordable internet coverage is reached, and fast internet could increase the probability of employment to 13.2% from 6.9%.
While this is a major challenge to the growth of Africa’s digital economy and would require years of policy implementation, corporate Africa can begin to support (in their ways) the digital transitioning of SMEs.
Written by CNBCAFRICA
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