Unlocking Africa's debt solutions: experts champion investment in its digital economy

G7 leaders convene in Japan to tackle urgent global concerns including the Ukraine invasion, climate change, and food insecurity.

Simultaneously, African nations prioritize economic recovery from the pandemic and debt risks, with the digital economy emerging as a pivotal driver of employment and growth, projected to dominate the global workforce by 2100.

A recent report by the World Bank titled "Digital Africa: Technological Transformation for Jobs" highlights Sub-Saharan Africa's significant gap between digital infrastructure availability and actual usage. Bridging this gap would unlock enormous potential for job creation and economic recovery in a highly digitalized world.

The fintech industry in Africa is emerging as a vital player in this digital transformation. Between 2020 and 2021, the number of tech startups in Africa tripled, with nearly half of them operating in the fintech sector. 

These companies are leveraging digital technology to address challenges in healthcare, agriculture, and e-commerce. The COVID-19 pandemic has further accelerated the trend towards digitalization, providing opportunities for new technology players to thrive.

African companies and governments are actively partnering with counterparts from the global south to develop innovative solutions and build digital infrastructure. These partnerships aim to provide digital public goods and expand access to essential services for citizens, particularly those in remote and underserved areas. 

By investing in digital public goods, governments can overcome traditional obstacles and reach a broader percentage of the population.

“Investments in digital public goods have the ability to transform governments and governance by making important public services available to citizens more effectively and inclusively,” said Nick Barigye, CEO, Rwanda Finance Limited, which is hosting its inaugural high-level Inclusive Fintech Forum in Rwanda.

Creating a favorable legal and policy climate is crucial for developing Africa's capital markets and digital economy infrastructure. Governments must enact policies that attract domestic and foreign investors while safeguarding property rights and fostering transparency and accountability. 

Collaboration and partnerships among African governments, international organizations, and private sector firms are essential for sharing knowledge, experiences, and resources to drive the expansion of Africa's digital economy.

Promoting south-south cooperation is key to addressing common challenges and sharing best practices. Elevandi, a company established by the Monetary Authority of Singapore in partnership with Rwanda's Kigali International Financial Centre, is hosting the inaugural Inclusive Fintech Forum in Kigali. 

This event aims to facilitate the transfer of digital technologies and knowledge across regions, enabling countries in the global south to learn from successful implementations elsewhere. Harmonizing digital infrastructures will further facilitate capital movement and potential investment between countries in the global south.

“One of the main advantages of South-South partnerships in digitisation is that they can help countries in the global South to address common challenges and share best practices. For instance, many countries in the global South face similar issues when it comes to providing digital services to rural communities with limited internet connectivity. This is an issue that is not only faced by Zambia, for example, it is also seen in Bolivia and Thailand, ” explained Pat Patel, Executive Director, Elevandi.