Nairobi, Kenya, 26 – 27July 2010
RELIABLE TELECOMMUNICATION SERVICES FOR ECONOMIC AND SOCIAL
DEVELOPMENT IN AFRICA
Paul Kiage,Manager/Projects M&E
CCK
ITU-T Workshop on Delivering Good Quality Telecommunication Service
in a Safe Environment in Africa (Nairobi, Kenya, 26 July – 27 July 2010 )
Agenda
Overview Analysis of Key factors for
Telecommunications Growth in Africa Economic Benefits Social Benefits Regulatory Approaches Conclusions
2
Telecommunications Overview
It is estimated that 370 million people in Africa are connected through mobile prepaid services 85% (2009) Penetration of about 42% by Q1 of 2009Africa has >80% of the population in the rural. But only 60% - 70% of population coveredExtensively voice service but evolving to data broadband and mobile InternetThe dominant technology: GSM, GPRS/EDGE; 3GSM:- W-CDMA and HSPA.
Nairobi, Kenya, 26 – 27 July 2010 3
ICTs Statistics for top 15 countries in Africa
Country
(source: ITU, 2009)
No. of cellular subscribers in million (2009)
Penetration % (2009)
No. of fixed subscribers in ‘000 (2009)
Penetration % (2009)
Nigeria 73’09 47.24 1’419.0 0.92
South Africa 46’43 92.67 4’319.8 8.62
Egypt 55’35 66.69 10’312.6 12.42
Algeria 32’73 93.79 2’576.2 7.38
Morocco 25’31 79.11 3’516.3 10.99
Kenya 19’36 48.65 664.1 1.67
Tanzania 17’46 39.94 172.9 0.40
Sudan 15’33 36.29 370.4 0.88
Libya 5’00 77.94 1’100.7 17.15
Ghana 15’10 63.38 267.4 1.12
Tunis 9’75 94.96 1’278.5 12.45
Cote d’Ivoire 13’34 63.33 282.1 1.34
DRC 10’16 15.39 40.0 0.06
Uganda 9’38 28.69 233.5 0.71
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Africa: connections per 100 people
Africa’s Digital Divide TrendsAfrica’s Digital Divide Trends
The fixed remains fixed: Therefore Africa must adopt wireless
ICTs Coverage Gap Analysis: 24 AICD
10/04/237
The Governments Regulatory Reforms – Liberalization and increasing competition – Market orientation
Changing customer needs : Voice to broadband services, Mobile Internet, MMS
Globalization /internationalization : International gateways liberalization/Submarine cables and roaming services
Substitute products and technology evolution:
One Network enhancing communication across countries in Africa e.g. Zanin
Key Growth Factors : Industry Forces
10/04/238
Capital Investments: Enabling investment policies
Human resource development initiatives:Technical and managerial skills : development of local poolMotivation and retention to avoid brain drain
Creativity and Innovations: New usage, new markets in rural : For example money transfer services; e-agriculture, e-health, e-education, e-government etc
Technology innovations: LTE, new products, quality, and reliability, affordability of services
Key Growth Factors : Resource Based View
9
Relating ICT Policies to Development There exist positive correlation between
telecommunication and economic development ICT policies in Africa recognises the central
importance of reliable access to telecommunications in the achievement of economic and social goals
Reliable, affordable and easy access to telecommunication services have been identified as key pillars to social and economic development in African countries Kenya included (Vision 2030), Ghana, Rwanda etc
Analysis
Economic Benefits
Contribution to GDP: Telecommunications generates 3.5-5.6 percent of National GDPs in Africa, a significant positive fiscal impact on development
0
1
2
3
4
5
6
2000 2001 2002 2003 2004 2005
Non-liberalized countries Liberalized countries
Source: AICD
Revenue for Governments: License fees & Taxes
15%
13%
15%
15%
16%
5%
15%
5%15
%
14%
10%
20%
18%
10% 7% 12
%18
%
18%19%
17%
18%
18%
18%
18%
19%
18%
18%
0%
5%
10%
15%
20%
25%
30%
35%
Beni
nBu
rkin
aC
amer
oon
Cap
e Ve
rde
Cha
dC
ongo
DR
CC
ote
d'Iv
oire
Ethi
opia
Gha
naKe
nya
Leso
tho
Mad
agas
car
Mal
awi
Moz
ambi
que
Nam
ibia
Nig
erN
iger
iaR
wan
daSe
nega
lSo
uth
Afric
aSu
dan
Tanz
ania
Uga
nda
Zam
bia
0%
5%
10%
15%
20%
25%
30%
35%
VAT Excise Average VAT
Source: AICD.
Foreign Direct Investment
Influx of FDIFrom negligible Foreign Direct Investment (FDI) a few years back, the telecom sector in Africa has attracted foreign investment on license and infrastructure roll-outThe private sector has driven investment in the sector mostly operations in mobile communications in the form of privatizations of the incumbent Telcos, license fees and infrastructure roll-out http://ppi.worldbank.org/
13
Poverty: An outcome of interaction between and reinforcement of economic, social, and political processes which can lead to exacerbation or alleviation of deprivation experienced by poor men and women (World Bank,2002)
Reliable ICTs has contributed towards reduced poverty
Employment: Directly and indirectly added jobs to employment in the African countries.
Social Benefits – Impact on Poverty and Employment
14
Other Benefits: Increased social networking: face book, MySpace, YouTube etc Increased cultural diffusion, exchange & learning Increased access to relevant information for marketing and
distribution of agricultural products and other goods manufactured in rural Africa
Growth of local industries including relocation of industries from congested urban to rural areas
Accelerated and integrated development of rural areas by playing a catalytic role in development
Increased access and relying of information on medical treatment, education, disaster relief and administrative / improved governance
Improved citizenry empowerment e-government services, m-banking, e-health, e-education etc.
Improved sense of security and ability to contact emergency services
Social Benefits cont’d
15
Unified Licensing framework (ULF) facilitating fixed-mobile convergence
Simplify the licensing regime to accommodate rapid technological change and emerging competition
Service licensing approach as opposed to technology
Review of regulatory framework to attract private investment
Abolish / reduce taxes on handsets and airtime Enabling interconnection policies Integrate Africa into the global network through
fibre optic undersea cables
Regulatory Approaches for Sustainable Telecommunications Development in
Africa
16
Development of infrastructure sharing policies (sites, masts & ducts)
Pursue deeper levels of liberalization by lifting the remaining exclusivities; introduce mobile number portability (MNP) etc
Universal service obligations / roll-out targets
USF to bridge the existing ICT access gaps that are not commercially viable
Regulatory Approaches for Sustainable Telecommunications Development in Africa
17
• ICT technology facilitates service delivery hence its reliability & critical purpose socio-economic development
• Telecom sector liberalization has and is continuing to improve access to telecom services to nearly all segments of the society in Africa• Economic and social benefits have been significant and continue to multiply• Governments are keen to undertake measures necessary to ensure sustained growth in socioeconomic benefits
Conclusion
Thank You!