Digitalization in Africa: The Lay of the Land

By: Chané Fraser

Africa is on the rise, but not in the way older development models predicted. Unlike economies that moved from agriculture to manufacturing, many African nations are seeing a swift shift directly into services and digital sectors. With Africa soon poised to provide one-fifth of the global workforce and a third of its youth by 2030, understanding the digital landscape is more important than ever.

Measuring the Digital Journey

The study introduces a Digitalization Gap Index (DGi), inspired by poverty measurement methods, to gauge where African countries stand in five key areas:

• Digital infrastructure (internet, phone access)
  
  

• Digital entrepreneurship (venture capital, ICT exports)
  
  

• Digital finance (mobile money, online transactions)
  
  

• Digital public platforms (e‑government services, citizen engagement)
  
  

• Digital skills (education levels, schooling infrastructure)

Africa Versus the G20: The Persistent Gap

The G20 (Group of Twenty) is an international forum made up of 19 countries and the European Union. When compared to G20 averages (used as benchmarks), Africa shows vast disparities:

• In digital skills, not a single sampled African country met the G20 average, as of both 2011 and 2017.
  
  

• Overall, about 98% of African countries fell short of G20 standards by 2017 across the composite index.
  
  

• The largest contributors to the gap: digital infrastructure and, rapidly rising in importance, digital skills.

Encouraging Trends Amid the Struggle

Though the gaps remain wide, Africa has made headway:

• Digital finance improved relative to the G20 by nearly 20%, and public digital platforms by an impressive ~27%.
  
  

• Access to venture capital and loans has slowly improved, though still falls short of the G20 level.
  
  

• Some countries, like Mauritius, South Africa, and Rwanda, now lead the region in these dimensions.

Knowing What to Prioritize

Looking at which factors are most responsible for the digital gap:

• In 2011, digital skills made up about 17% of Africa’s digital gap; by 2017, that rose to ~19%.
  
  

• Digital infrastructure remains the biggest drag on progress, but digital skills are growing in relative importance.
  
  

On a country scale, the trio of Niger, Malawi, and Madagascar topped the list of those furthest behind, while Mauritius, South Africa, and Tunisia fared best, though still lagging compared to G20 peers.

A Practical Model for Skills: South Africa in Focus

The authors also propose a task-based approach to pinpoint digital skills demand and supply using labour data and U.S. occupational benchmarks:

• By mapping labour force roles to digital skill scores, they highlight how certain jobs, like computer systems analysts, score high on digital engagement (e.g., near 78 out of 100).
  
  

• This method allows countries to more precisely measure gaps and align education or training to actual demand.

Why It's Time to Care (And Act)

• Massive Youth Potential: With Africa’s youth booming, digital skills are the gateway to better livelihoods and economies that can leapfrog traditional development hurdles.
  
  

• Persistent but Narrowing Gaps: Gains in digital finance and e‑government show that progress is possible, even if slow.
  
  

• Strategic Priorities: Investing in digital infrastructure remains urgent, but education and digital skills development must become even higher priorities.

In a Nutshell:

Africa is on the digital frontier, but many countries are trailing behind global peers. While infrastructure remains the greatest hurdle, the increasingly critical role of digital skills cannot be ignored. Encouragingly, the region has made measurable progress in digital finance and public platforms. To close the gap, policymakers and development partners need to focus on building digital capacity, not just hardware but human capital.

⁎ Reference Article Link: https://www.brookings.edu/wp-content/uploads/2023/05/Bhorat-et.-al-May-2023-Digitalization-and-digital-skills-in-Africa-2.pdf?fbclid=IwY2xjawMVcStleHRuA2FlbQIxMABicmlkETE0dTRncE9JaXVqcGtLc0xYAR4npJgNtOS4J0HjwjVUS01IWNwGZM2PPVPbUwoRNI0OsBWQfJyaKw58HcLr_g_aem_sX3dAh6CHHwztjmOUenWaQ