My 2023 Projections for the African Tech Space
In recent years, Africa has seen significant growth in its technology sector, with projections indicating that this trend will continue in the coming years. McKinsey analysis estimates that Africa’s financial-services market could grow at about 10 percent per annum, reaching about $230 billion in revenues by 2025. By 2023, it is expected that the technology market in Africa will reach $180 billion, driven by factors such as increasing access to the internet, rising mobile phone penetration, and a growing middle class with more disposable income.
One major area of growth in Africa’s technology sector is mobile technology. With over 600 million mobile phone users in Africa, mobile technology has become a key enabler of economic and social development on the continent. Mobile phone usage has made it possible for people to access information and services that were previously unavailable, such as banking, healthcare, and education. Additionally, mobile payments have become increasingly popular in Africa, providing a convenient and secure way for people to make transactions without the need for cash or traditional banking services. Fintech players have wasted no time in carving out a share of this expanding market and have become the fastest-growing start-up industry in Africa, with payments and wallets being the fastest-growing products. Most fintech players employ an "Omni-value" strategy to attract more users and deliver value.
Another area of growth in Africa’s technology sector is e-commerce. Online marketplaces and platforms are becoming increasingly popular in Africa, as they provide a convenient way for consumers to shop and businesses to reach new customers. Additionally, e-commerce is helping to drive economic development by creating new jobs and business opportunities. As a result, it is expected that the e-commerce market in Africa will reach $75 billion by 2023. Industry leader, Jumia, is poised to lead the charge for this growth.
The increasing adoption of technology in Africa is also having a positive impact on the continent’s healthcare sector. Telemedicine, for example, is making it possible for people in remote and rural areas to access medical care, regardless of their location. Additionally, technology is helping to improve the efficiency and effectiveness of healthcare delivery, by providing doctors and nurses with access to patient data and medical records.
The growing technology market in Africa is creating new opportunities for businesses, both within the continent and from other parts of the world. As the market continues to grow, it is expected that more companies will enter the African market, either by setting up operations on the continent or by partnering with local businesses. Additionally, as Africa’s middle class continues to grow, there will be more demand for consumer goods and services, creating opportunities for businesses that can meet this demand.
However, businesses looking to enter the African market will need to take into account certain challenges, such as the lack of infrastructure and the need to adapt to local cultures and customs. Additionally, businesses will need to be aware of the regulations and legal requirements in the countries they are operating in, in order to avoid any legal issues.
In conclusion, this impending growth is creating new opportunities for businesses in Africa and abroad, but also present challenges that need to be overcome. As the technology market in Africa continues to grow, businesses will need to be adaptable and responsive in order to succeed in this dynamic market.
