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Growth of Mobile Internet, if well regulated, presents numerous opportunities for Africa's economic growth

Growth of Mobile Internet in Africa calls for a supportive regulatory and policy framework.
The sustained growth of mobile telephony and increased penetration of smart devices is the future of Africa's e-economy.It is expected to play a critical role in Africa’s sociology-economic prosperity. According to The GSMA’s Sub-Saharan Africa Mobile Economy Report (2013), there were 502 million active SIM connections in Sub-Saharan Africa in 2013, and the numbers are expected to grow annually at an estimated 18%. This, by global average is phenomenal growth. The sector contributes 6% to the Sub-Saharan Africa’s GDP and has created 3 million jobs.
The penetration of smart phones is forecasted to occupy a 20 % market by 2017 (GSMSA). Upgrade from 2G to 3G networks and more affordable smart phone devices will be the key drivers of this growth. Besides spurring development of mobile applications in sectors such as health, finance and education, this growth gives Africa a chance to sell its uniqueness the rest of the world, thanks to the Internet. MODE, (Mobile Decisioning)-see (http://mo-de.co/) a Kenyan- born company that offers mobile value-added services to mobile network operators is a good case of the infinite opportunities that Africa can tap from mobile telephony. MODE offers revolutionary services such as advance airtime and data bundles, and operates in over 13 countries in Africa. It has grown exponentially to a global scale, and has been listed as one of the 50 top future companies to watch out for in The UK. MODE founder Julian Kyula confirms that it was not easy in the earlier years. Business mentor ship and incubation services were rare, and financiers were unwilling to risk their investment in his dream. However, Julian’s persistence and positive attitude eventually paid off. In 2012, his company won the IBM Global Entrepreneur of the Year (2012) Award. He also attributes the success of his tech-business to positioning and tapping into emerging markets.
MODE’s success story is one of growing many, and attests that there are boundless opportunities for African tech-start ups in the mobile phone services sector. However, The GSMA cautions that an unfavorable tax regime on the sector by some governments may stifle “the potential of the industry to drive both economic and social development” in Africa. Governments and other stakeholders must work tirelessly to ensure a Supportive regulatory and policy environment to spur investment and growth in the sector.

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Comment by Robert Andrew on October 6, 2014 at 4:22pm

@Clifford Agugoesi. Thanks for your comment. Unfavorable tax regimes in Africa have kept the cost of Mobile tariffs very high. African governments must take well-meant steps like Nigeria to stabilize sector-taxes; to encourage more subscriptions; and to encourage investment in 3G and higher networks. More mobile subscribers will drive up demand for data services, thus enjoyment of mass market benefits that would include lower data rates. Moreover, there is still great need to harmonize  (data) roaming charges so that subscribers can continue to enjoy connectivity on the go at rates that are not too prohibitive.

Comment by Clifford Agugoesi on October 6, 2014 at 2:11pm
Good story. The GSMA warning is already being taken care of by many countries, Nigeria, being a case study, where multisectoral consultations in the ICT sector, to harmonise and reduce taxations, by both the Ministry of Communication Technology, MOCT, and the Nigerian Communications Commission, NCC, are yielding positive results. Sure, no country wants to stifle investment with unfavourable taxation. It is also expected that the companies reciprocate governments' gestures on tax relief by coming up with robust and sustainable corporate social responsibility programmes and activities that could wrought positive changes on the economies of the respective countries.



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