The UN Human Development Report 2013 points out that telecommunications, especially mobile phones, have helped Africa along its path towards the desired development by allowing significant improvements in key areas for the future of the continent.
Development goes mobile
In recent years, economic growth in the South has been fuelled by increased investment as well as the growth of trade in these countries. Africa is not an exception and, among the drivers facilitating growth, telecommunications – particularly mobile phones – must be underlined. From communication to banking, without neglecting the service industries, health, political and education sectors, media or agriculture, the mobile phone is playing an important role in African development.
Besides allowing quick and cheap communication, mobile phones have also transformed African reality. Today, without leaving home and only with a mobile phone, it is possible to transfer money or pay bills, to receive a reminder concerning medical visits, to order farm products or to get in touch with political activities, for instance. This new reality has expanded to related services, promoting new businesses and creating employment.
The mobile industry in Africa
Only twenty years have passed between the first mobile phone call in Zaire and a $50 billion investment in Sub-Saharan Africa (from 2007 to 2012) for the improvement and expansion of mobile coverage. This rapid growth has been mostly promoted by companies based in India, South Africa and the United Arab Emirates, but, nowadays, major telecommunication companies from all over the world are also investing in Africa.
Due to bad coverage regarding fixed-line phones and broadband internet, telecommunication companies saw Africa as a good place to develop a new business model concerning mobile phones: very low cost phones with pre-paid cards in order to increase the number of subscribers. As a result, by 2012, the number of mobile subscriptions in Africa was around 650 million, surpassing the USA and the EU.
Challenges towards the future
Despite these positive aspects, some challenges must be faced. Due to both cost and usability problems, a large number of Africans are without access to the benefits of mobile phones, which can deepen the gap inside the continent. On the other hand, governmental restrictions as well as the information and communications control in some African States have prevented greater competition which would contribute to a wider variety of services and lower prices.
Concerted policies between States and private companies, market liberalisation and market regulation can be part of the solution to solve these problems.