Connecting Africa is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 3099067.

Digital Inclusion

Mobile tech helps drive e-commerce in Central Africa

Article Image
Mobile technology has emerged as a key driver of e-commerce across Africa, and a new report says it has the potential to generate significant social and economic benefits, particularly in the Central African region.

The new report from the UN Economic Commission for Africa (ECA) and the GSMA is calling on the governments of Central African nations to adopt policies which are more conducive to e-commerce, including better access to digital services and more public-private collaboration.

In a report titled "Enabling e-commerce in Central Africa: the role of mobile services and policy implications," the authors warn that the 11 countries in question are falling behind their peers.

The report said that e-commerce activities globally have been boosted by rising mobile Internet and smartphone adoption, as well as the ease and convenience that mobile devices bring to the process of online shopping. From around two-thirds of e-commerce retail sales today, mobile is forecast to account for more than 73% by 2022.

E-commerce is also growing quickly in Central Africa and mobile connectivity and payments are key to gaining momentum. By the end of 2020, there were 16 live mobile money services in ECCAS serving nearly 50 million registered accounts.

"Central Africa is budding with economic potential and e-commerce can accelerate that growth," said Angela Wamola, the GSMA's head of Sub-Saharan Africa.

"The GSMA is proud to partner with the ECA on this report bringing our knowledge of how digital technologies can propel sustainable development to the work. We hope it will inspire action from policymakers and stakeholders in the region," she said.

The report also found that women and young entrepreneurs in particular are increasingly using e-commerce platforms to grow their businesses, reducing inequalities and helping local value creation.

ECCAS expands digitally

The digital economy in the Economic Community of Central African States (ECCAS) is expanding rapidly, driven by the strong adoption of mobile services.

ECCAS is made up of the nations of Angola, Burundi, Cameroon, Central African Republic, Chad, Congo, Democratic Republic of Congo, Equatorial Guinea, Gabon, Rwanda, and Sao Tome and Principe.

Overall mobile subscriber penetration in the sub-region grew from just 18% at the start of the last decade to 42% by the end of 2019, the authors say. Meanwhile, the number of mobile Internet users had reached 46 million by the same date.

"This trend is facilitating the creation and consumption of new digital services, which are transforming the way people communicate, live and work," the report said.

E-commerce is a key component of the digital economy, allowing buyers and sellers to interact and transact online regardless of time and location.

Several e-commerce providers have emerged across the sub-region in recent years, serving both the domestic and global markets. Jumia, is an example of this and is Africa's largest e-commerce company with operations in 11 countries across the continent.

Mobile platforms dominate customer visits for retailers in Africa. For example, for Jumia Nigeria in 2019 mobile devices accounted for 85% of customer visits. In contrast, only a quarter of total e-commerce sales in the US were completed over mobile devices in 2019.

Social commerce is also gaining momentum in ECCAS, boosting uptake of social media services and lowering barriers to entry for small businesses.

The report said that Facebook is by far the most popular social media service in ECCAS with a total user base of 14 million as of January 2021. It has become the preferred platform for many e-commerce entrepreneurs across the region.

Central challenges

Despite this progress, all 11 countries in Central Africa are falling behind when compared to their peers. In ECCAS, retail services are still predominantly traditional and informal.

"The United Nations Conference on Trade and Development (UNCTAD) estimates that around 90% of transactions across Sub-Saharan Africa occur through informal channels. This is partly because of entrenched consumer attitudes and shopping behaviours. However, there is growing momentum towards modern and more formal channels, with e-commerce playing an increasingly important role in the evolving retail landscape," the report said.

The report's authors believe the region can progress quickly if governments enact policies to accelerate digital and e-commerce services. These include enhancing digital and financial inclusion, taking the right approach to data regulation, addressing key challenges in the business environment, and leveraging stakeholder collaboration.

"Mobile network operators must play a critical role to accelerate digital inclusion, economic diversification and sustainable development," said Antonio Pedro, director of ECA's sub-regional office for Central Africa.

"If governments act now, Central Africa can be more competitive and collaborative for the benefit and inclusion of all citizens."

*Top image source: GSMA report Enabling e-commerce in Central Africa: the role of mobile services and policy implications.

— Paula Gilbert, Editor, Connecting Africa

Innovation hub

Story

African tech startup funding hits $3.3B in 2022

Investment in Africa's tech startup ecosystem passed $3 billion for the first time in 2022, with Nigeria taking the biggest piece of pie and fintech dominating other sectors, according to a report from Disrupt Africa.

Story

Connecting Africa Podcast: S2 Ep. 4 – Agri-fintech, from kibbutz to Kenya

The Connecting Africa Podcast team speak to Israeli-Kenyan startup Avenews' co-founder and CEO, Shalom Ben-Or, about his fintech super-app that has been built specifically for Africa's agriculture industry.

More Innovation hub

Flash poll

All polls

Partner perspectives

All Partner Perspectives

Africa Tech Perspectives

Story

Women in Tech: Spotlight on inclusivity with Digital Council Africa's Juanita Clark

Digital Council Africa founder and CEO, Juanita Clark, talks to Connecting Africa as part of our Women's Month series about her career and what needs to be done to make the tech industry intentionally inclusive.

Story

Women in Tech: Spotlight on legal tech with Life.file's Sinal Govender

Life.file co-founder, Sinal Govender, talks to Connecting Africa as part of our Women's Month series about her career and how we can encourage more young girls to enter the legal tech field.

Story

Digital inclusion as a catalyst for economic empowerment: Mastercard's Imelda Ngunzu

Mastercard's Imelda Ngunzu talks to Connecting Africa about how digital payment solutions and mobile money are transforming the lives of small business owners, women and marginalized groups in East Africa.

More AfricaCom perspectives

Latest video

More videos

Industry announcements

More Industry announcements

Guest Perspectives

Story

Omdia View: July 2022

By Omdia Analysts

Kenya and Zambia move towards 5G with new spectrum allocations while Tunisie Telecom plans to shut down its 3G network - that and more in this month's Omdia View.

Story

Omdia View: June 2022

By Omdia Analysts

5G was the major news trend across Africa in June, as Orange became the first operator to launch 5G in Réunion and operators in Senegal accelerated their 5G plans despite spectrum delays.

More Guest Perspectives

Sponsored video

More videos

Like us on Facebook

Newsletter Sign Up


Sign Up