Mobile Industry To Contribute More Than US$50bn To West African Economy
West Africa’s mobile industry is forecast to contribute more than US$50bn to the region’s economy annually by 2025, on the back of consistent value to the tune of $37bn last year, or 6.7% of GDP.
This is according to a GSMA report, The Mobile Economy: West Africa 2018, which explores the impact of mobile and the industry’s potential over the coming years.
Currently, the impact on GDP is significant, but with the right support it could reach as much as a $51bn total worth, equivalent to 7.7% of GDP within five years. However, “more than half of West Africa’s citizens are not yet connected to a mobile service, excluding them from the socio-economic benefits that mobile delivers”, noted John Giusti, Chief Regulatory Officer at the GSMA.
The impact on jobs, the report argues, will be significant through productivity gains primarily, as efficiencies speed up key business processes. Greater connectivity will, many marketers believe, be significant for marketing, not only as a media channel, but increasingly as a payments channel.
Across the region, there were 176 million mobile subscribers at the end of 2017, equivalent to 47% of the population. Already, this is a major improvement on the beginning of the decade, when penetration was under a third (28%). Mobile subscriptions are growing in concert; 72 million additional subscribers are expected by 2025, taking penetration to over half (54%).
However, mobile internet penetration remains low at 21% across the region. Leading countries in mobile internet coverage as a percentage of population are Cabo Verde, Ghana, and Cote D’Ivoire.
With a young population – a demographic makeup, says GSMA, representative of much of Sub-Saharan Africa – and expanded network capabilities, including 3G and 4G networks. Fast mobile internet accounted for just 36% of mobile connections in 2017, but with around $8bn of infrastructure spending slated for the next two years, the report estimates that by 2025, 94% of mobile connections will employ fast internet.
Africa has, since 2007, and the introduction of M-Pesa, the mobile money platform, in the East African nation of Kenya, developed a steady stream of investment in technology across the continent. For some brands, also, early involvement has been important.
For a brand such as Guinness, Africa is crucial, as the continent accounts for over 40% of all volume sales. Speaking at Advertising Week Europe, Halie Ritterman, Global Digital and Data Lead at Diageo argued that in Africa, “mobile is leapfrogging what is happening in the rest of the world”.