Across Africa, e-commerce platforms flanked by payments, logistics, tourism and big data partners, are beginning to lift local economies, says e-commerce giant Alibaba’s Business School and the United Nations Conference on Trade and Development (Unctad), which co-hosted the Netrepreneurs: The Rise of Africa’s Digital Lions conference, in Johannesburg, on Wednesday.
“Entrepreneurs are at an inflection point. With Internet penetration, smartphone ownership and e-commerce skyrocketing, entire industries will be completely remade as new ventures emerge and compete with foreign firms and conventional businesses,” said Alibaba Group VP Brian Wong.
Entrepreneurs can be the catalysts for change and enablers for inclusive economic growth. With e-commerce, for example, global access to products is possible, inclusive financial services can be offered, and farmers can sell their own produce, he added.
If African entrepreneurial talent and energy can be channelled by a conducive environment created by policymakers, educators and investors, new businesses will offer goods and services that solve problems, create value and provide opportunity for people across the African continent, said Alibaba.
“These actors can choose to pursue traditional development, or they can leverage emerging technology and skills to leapfrog interstitial industrial modes to create something productive, efficient and unique to Africa,” it added.
However, it is necessary for policymakers to create an environment where digital technologies are promoted.
Botswana Investment, Trade and Industry Minister Bogolo Kenewendo said that physical, as well as legislative, infrastructure are required to enable the transition to a digital economy.
Most African countries do not have e-commerce or digital trading policies, while having a lack of proper cybersecurity measures; therefore, a lot needs to be done before e-commerce will kick off on a large scale in Africa, she noted, adding that technology should not be used to rush to catch up to global trends, but rather to solve local problems.
Kenewendo further suggested that governments promote education and skills development suited to a digital economy. She put forward that it is of no use to have the physical infrastructure, while operators and users do not have the capability to make use of it or derive value.
During a panel discussion at the event, Mara Corporation founder Ashish Thakkar noted that, with the African continent being host to six of the ten fastest-growing economies, and with 85% of the African population being under the age of 35, now is a ripe time to invest in African digital economies.
Out of the 1.3-billion people in Africa, there are 453-million Internet users (35% Internet penetration). There are 28 countries with less than 10% Internet penetration, including Ethiopia, the Democratic Republic of Congo and Tanzania.
“The need for collaboration between policymakers, investors and educators has never been higher. Strategic thinking and a focus on long-term outcomes for Africans is vital to fully harness the power of the Internet, which will launch new industries, solve problems and increase quality of life,” said Alibaba.
The company added that small decisions now can shape decades of economic realities, and the more all parties can communicate, the more these outcomes may be optimised.
Alibaba group founder and executive chairperson Jack Ma launched the Jack Ma Foundation ‘Netpreneur’ Prize at the conference. The Netpreneur Prize is a new programme created to support and fund African entrepreneurs who are working to address Africa’s most important challenges and further its digital economy through local entrepreneurship.
The Netpreneur Prize – named for empowering a new generation of entrepreneurs, and focusing on small business growth, grassroots innovation and women founders – will award $10-million to 100 African entrepreneurs over the next ten years.
Starting in 2019, the Jack Ma Foundation will host a yearly pitch competition, with ten finalists selected from across the continent to showcase their talent and business ideas and compete for $1-million in prize money. All ten finalists will receive grant funding from the Jack Ma Foundation, as well as access to the Netpreneur community of African business leaders to leverage the community’s shared expertise, best practices and resources.
While the competition will be open to entrepreneurs in all industries, Ma expects many of the applicants to be founders of businesses that are Internet-driven, given the open and inclusive impact technology can have on local economies.
Applicants must be African nationals leading mission-driven organisations. The finalists will be selected by a team of judges from five regions representing the entire continent. Applications for the first pitch competition will be open from January to April 2019, and the finalist pitch competition will be held and broadcast across Africa in the second half of 2019.
The programme will be offered across the continent through lead continental partner, Nailab, and other regional hub partners.
Ma said that, as a fellow entrepreneur, he understands the importance of getting support during the early days. "This prize demonstrates our support of the next generation of young entrepreneurs across Africa who are paving the way for a better future and imparting positive change in their communities. I am inspired and encouraged by these entrepreneurs who, together, will help build a sustainable, inclusive economy for Africa and for the world.
The Netpreneur Prize is the second initiative launched by Ma to support African entrepreneurs. Last year, Alibaba Business School and Unctad announced the eFounders Fellowship Initiative, a programme that will train 1 000 entrepreneurs from emerging markets, 200 of whom will come from Africa, with the purpose of building a community of young entrepreneurs committed to creating digital platforms to build more inclusive economies.
This programme supports the aims of the United Nations Sustainable Development Goal of ensuring that no one is left behind in the digital economy.
To date, 52 African entrepreneurs have participated in this two-week fellowship at Alibaba’s headquarters in Hangzhou, China. Participants make a two-year commitment to improving society through their businesses.
The rise of the digital economy provides growth and opportunity to the developing world.The work that Ma and Unctad are doing together will help empower the emerging generation of young African business leaders to participate in and lead that growth.