West Africa’s mobile economy valued at over $50bn in 2018 - BUSINESSDAY
…As mobile boosts economy, creates jobs across continent
The mobile ecosystem in West Africa last year generated more than $50 billion in economic value, an equivalent of 8.7 percent of the region’s gross domestic product (GDP).
Rising mobile phone ownership and the ongoing migration to mobile broadband networks and services across the region have positively impacted economies and West Africa is likely to see more economic contribution from the mobile ecosystem which will continue to increase over the coming years, forecast to reach almost $70 billion (9.5 percent of GDP) by 2023, according to a new GSMA study.
The 2019 West Africa edition of the GSMA’s Mobile Economy report series was published at the ‘Mobile 360 – West Africa’ event being held in Abidjan this week.
“Today’s report underlines the vital role the mobile ecosystem is playing in contributing to economic growth, social development and job creation across West Africa,” said Akinwale Goodluck, head of sub-Saharan Africa at the GSMA.
“To harness the power of a new generation of mobile users and mobile networks, we urge governments and policymakers in West Africa to develop regulatory frameworks that encourage innovation and investment in the sector, enabling the provision of mobile-powered digital services to citizens across the region,” Goodluck said.
The report reveals that the number of unique mobile subscribers across West Africa reached 185 million at the end of 2018, equivalent to 48 percent of the region’s population. This number is forecast to rise to 248 million by 2025 (54 percent of the population).
Nigeria is at the forefront of high mobile phone penetration with the number of mobile phone subscriptions surpassing the total number of its population – with over 173 million active mobile phone subscriptions in February 2019, it is no surprise that subscriptions will rise and may surpass 248 million in West Africa by 2025 (54 percent of the population).
The world has gone mobile, according to analysts, a fact justifiable by the increasing use and dependence on smartphones and other mobile devices – and Africa is not left behind.
“Another report carried out by Ericsson sometime last year showed that Nigeria had the fifth largest mobile subscription growth in the world in the first quarter of 2017, with over 3 million new, trailing behind India who grew the most in terms of net additions during the quarter with more that 43 million, China with more than 24 million, Indonesia with 10 million and Pakistan with 5 million, respectively,” says Seun Ogunbandele, a telecoms industry analyst.
“This shows the growing rate of Africa’s mobile economy, even as telecommunications revenues spike. In fact, countries like Nigeria are looking towards the telecoms sector for economic diversification,” Ogunbandele said.
The GSMA report also forecasts that future subscriber growth in West Africa will largely be driven by young consumers owning a mobile phone for the first time; more than 40 percent of the region’s population are people under 18 years old. It further confirms that 3G will overtake 2G to become the leading mobile technology in West Africa this year, supporting about half of the region’s mobile connection. Even as 4G momentum is also building: 10 new 4G networks have recently launched in West Africa, including the first ever 4G networks in Burkina Faso, Sierra Leone and Togo.
“Local mobile operators are increasing investment in their networks and are expected to spend $8.5 billion (capex) on network infrastructure and services over the next two years (2019/2020),” the report stated.
Most of the spend will be on broadband and data infrastructure, as mobile is the primary platform for accessing the internet in West Africa. At the end of 2018, there were around 100 million mobile internet users in the region, up by almost 20 million year-on-year.
The GSMA report shows that West Africa’s mobile ecosystem directly employs around 200,000 people, supports 800,000 jobs in the informal employment sector, and a further 600,000 jobs across the wider economy.