Upwardly Mobile Africa (report on ICTs Summit in Rwanda, w/focus on mobile phones)
Upwardly mobile Africa: key to development lies in their hands
A summit in Rwanda today aims to boost economies through networking
Richard Wray and Fahad Mayet
Monday October 29, 2007
The GuardianIn the barren surroundings of Kwa Phake in the north-east of South Africa, students from the town used to have to leave the families they often support and travel many miles to attend the University of South Africa. They can now study from home, even receiving exam results, using their mobile phones.
Fishermen in Tanzania, meanwhile, use mobiles to get weather reports, and a service has been set up in the Kenyan capital, Nairobi, that alerts jobseekers to potential work via text messages. While many people in developed countries use their phones to stave off boredom on public transport, in sub-Saharan Africa a mobile phone can be a passport out of poverty.
Today, the Connect Africa summit in the Rwandan capital of Kigali will bring together the heads of 10 African countries, ministers and experts from the mobile phone industry in an effort to put that passport in the hands of more people, bridging the digital divide.
The GSM Association (GSMA), the global trade association that represents some 700 mobile operators across the world, will announce that its members are investing $50bn (�25bn) in sub-Saharan Africa over the next five years. The aim of this funding, according to the GSMA, is to provide more than 90% of the population with mobile coverage.
The scale of the problem in sub-Saharan Africa is immense, not least because 41.1% of the population are in chronic poverty, living on less than $1 a day. The region has been plagued by famine, in countries such as Niger, and deadly wars over the past few decades. According to the UN, 62.2% of the population in 2005 lived in slums with unemployment in the 15-24 age group reaching 18.3%.
A growing body of research suggests communications are an essential tool for economic regeneration. Telecoms have a dramatic impact on GDP and lead to an increase in foreign direct investment.
According to a study by Professor Leonard Waverman of the London Business School two years ago, mobile phone penetration has a strong impact on GDP. He argues that "investment in telecoms generates a growth dividend because the spread of telecoms reduces costs of interaction, expands market boundaries and enormously expands information flows."
His previous work suggested that in the OECD countries "the spread of modern fixed-line telecoms networks alone was responsible for one-third of output growth between 1970 and 1990."
It is hoped that mobile phones will serve this same crucial function in the developing economies of Africa for two reasons. First, there is not sufficient existing infrastructure on the continent. In much of sub-Saharan Africa there are few fixed landlines and sometimes none. Uganda, for example, has fewer than five fixed lines per 100 people.
Second, many African countries do not have enough resources to build huge fixed-line infrastructure, much of which was state-funded in the west. This is not least because economies of scale cannot be created profitably in a region where population density can be as low as 25 people per square kilometre, as in the Democratic Republic of Congo.
Africa needs industry to invest in telecoms infrastructure. Non-governmental organisations agree. Tony Durham of ActionAid says: "If Africa is going to develop, it needs investment in infrastructure, and there is no reason why all that investment should come out of aid budgets."
There is already a significant amount of mobile coverage in Africa. While there are expected to be just over 200 million mobile users in Africa this year, a further 350 million live in areas where coverage is available. What these people need are cheap handsets and cheaper services.
The GSMA has been working on this since 2005, under the Emerging Market Handset initiative. It invited proposals from manufacturers for handsets costing less than $30 at wholesale, eventually endorsing two models from Motorola.
Since then, the retail price has fallen to about $20. But for many people, even this is too high. According to World Bank figures, 58% of Tanzanians live on less than $1 a day.
"One of the biggest barriers to the adoption of mobile communication in emerging markets is the handset cost," says a recent report by the mobile research firm Portio Research.
For those Africans with access to a mobile, it has become invaluable. A report commissioned by Vodafone found 25% of Tanzanians questioned used their phone for business, such as calling suppliers to get the best price for goods. Fruit growers can call contacts to determine what is selling well or what is missing from the market. Farmers can check weather reports and market prices for their crops without having to travel.
Mobile communications have bridged the gap between the affluent "banked" and the "unbanked" populations of countries such as Nigeria. Durham says: "The phone companies know that most of their customers are broke half the time. You get standardised 'please call me' messages from hard-up friends. When you call, the friend asks you to buy a phone credit voucher and send them the code number by SMS.
"People were already in effect sending money to each other by text message, before the phone companies got the idea of providing a full money-transfer service," he says.
Mobile phones also help people living in very remote areas get medical advice, while doctors in regional hospitals can get advice from senior colleagues in cities. Such a system operates in Mali through the IKON Telemedicine Project, sponsored by the International Institute for Communication and Development, where three regional hospitals are linked to the main hospital in Bamako.
Africa's mobile-phone industry has also created middlemen who provide services such as top-up and mobile recharging for a commission. "In tiny rural hamlets where there is no mains electricity you can pay 20 [Kenyan] shillings (15p) to have your mobile charged from a solar panel or a car battery," says Durham. "Phone credit vouchers can be bought almost anywhere ... It's probably a significant sideline for many small traders."
There is a clear challenge posed by the lack of power and energy infrastructure in Africa for the roll-out of mobile phone networks. There have been many initiatives to find alternative sources of power - at an industrial as well as a local level - with varying degrees of success. The use of diesel generators to power mobile phone masts had been popular in some parts of Africa. However, diesel generators and the fuel to power them are not cheap and the fact that they can be used to power other machinery made them prone to theft.
Maintaining them in remote rural areas was also a major logistical problem. Some mobile phone companies have been experimenting with other fuels, such as a locally sourced biodiesel, to cut costs. More recently, in Namibia, Motorola has been testing wind and solar-powered base stations, following trials at Motorola's factory in Swindon. The company is working with mobile network operators in other African countries looking to use the technology.