World Bank report highlights digital opportunities, challenges for African businesses

   The World Bank Group’s The International Finance Corporation (IFC) unveiled a report on Friday at the 11th Africa CEO Forum in the Rwandan capital of Kigali, highlighting digital opportunities for African businesses.

   The IFC report reveals significant disparities in digital adoption across Africa, influenced by firm size and economic status. In middle-income countries such as Ghana, Kenya and Senegal, 57 percent of firms with five or more employees use computers and the internet, compared with 44 percent in low-income countries such as Burkina Faso, Ethiopia and Malawi.

   Larger firms are more likely to embrace digital technologies, while smaller and informal businesses, especially in low-income regions, face barriers due to limited access to digital tools and infrastructure, according to the report. Mobile phones and digital payments are key entry points, with 86 percent of firms using mobile phones and 61 percent adopting digital payment systems.

   Despite the promising outlook, the report identifies several barriers to full digitalization, including inadequate digital and electricity infrastructure, high technology costs, low levels of human capital and limited access to finance. Digital equipment and software are more expensive in Africa than other regions, further hindering adoption.

   The report calls for increased private sector investment to promote digital infrastructure, support technology start-ups and improve access to finance. Regulatory reform and investment in digital infrastructure, especially with new submarine cables, could reduce internet costs and enhance connectivity.

   It also emphasizes the need for policies to reduce tariffs on digital goods and promote market integration.  Enditem

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