Jann Lay / Tevin Tafese

Africa’s Emergent Tech Sector: Its Characteristics and Impact on Development and Labour Markets

GIGA Working Papers | 2023


  • Abstract

    This study investigates the characteristics of Africa’s tech sector, its digital services, and its impact on economic development, specifically on labour markets. Our literature review and new analyses based on a database of African startups shows that Africa’s emergent tech sector is adapting to the continent’s constraints on development and, sometimes, contributes to overcoming them. A case in point is the credit constraints that numerous startups have overcome to attract very significant amounts of capital. Tech startups tend to be concentrated
    in financial services in the “Big Four”: Egypt, Kenya, South Africa, and Nigeria. We show, first, that “home-grown” African platform businesses do not simply connect demand and supply, but also invest in logistics and infrastructure; second, that many tech firms offer multiple products that complement the original service; and third, that business models often rely on large networks of agents. We conclude that more evidence on the impact of digital technologies is needed.

    Series

    GIGA Working Papers

    Series Number

    333

    Number of Pages

    36

    Publisher

    German Institute for Global and Area Studies (GIGA)

    Location

    Hamburg

    Africa Spectrum | 01/2025

    Africa's Emergent Tech Sector: Characteristics and Development Implications

    Africa’s tech sector is booming, with start-ups attracting funding in key underdeveloped industries like finance, retail, and transport. This study explores how digital technologies are tailored to local needs, their impact on development, and the potential of platforms like mobile money and e-commerce. More evidence is needed to shape effective policies.

    GIGA Working Papers | 06/2023

    Digitalisation and Labour Markets in Developing Countries

    The impact of digitalisation on labour markets is felt worldwide. In the Global South, internet access expands, digital platforms proliferate, but access to and use of digital technologies remains far from universal. We review evidence on the labour markets effects of some of these digital trends.

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