Egypt - Afrikan Heroes

New Cocoa Certification Threaten African Farmers

November 3, 2019

The new rules that will govern Cocoa certification which is being mulled by the World Cocoa Council will be to the detriment of African farmers’ majority of who are already disenfranchised by the lopsidedness in the industry. A farmers advocacy group said that Cocoa producers, particularly in Africa are worried that the introduction of new certification standards would give far more control to the big organizations in Europe who control the industry, moreso, the farmers are worried that this is a veiled effort by the Council to push the producers, especially the farmers to receive an income below the poverty line.

However, analysts say that while farmers should be pleased with its certification, producers are more concerned about certified sustainable cocoa. A sector that has seen the emergence of several sustainable certification standards in recent years, this necessary overhaul of the system to make the sector more sustainable, does not change the living conditions of producers, particularly African producers who still live below the poverty line on less than a dollar a day.

African commodity exporters are in for a rough ride as the African economy whose main trading partner, China, recorded a sharp 6% decline in growth in the third quarter of this year. This is a record low growth for China, which has recorded its weakest performance in at least twenty-seven years. The 6.2% growth in the third quarter of this year is due to increasing downward pressure from the economy. The fall could also have a strong impact in Africa, as Beijing is the continent’s largest trading partner, with an estimated trade volume of more than $170 billion in 2018.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.

Egypt Is Selling Off Most Of Its Companies

October 18, 2019

Egypt is fully committed to its program to sell minority stakes in state companies and is tackling a number of issues that have held it up, a government advisor on the share sales said on Thursday.

The government has been talking for years about selling the stakes but has repeatedly postponed the program, raising doubts among some economists about its commitment to privatization.

“From the meetings I attend on a weekly basis, the government is as keen as I have ever seen them on proceeding with the privatization program,” Mohamed Metwally, CEO of NI Capital, told Reuters.

“There has never been slack on this. It’s just a matter of sometimes you face things that take longer to prepare than expected,” said Metwally in his first interview with the media since taking over as NI Capital’s CEO in July.

The government set up NI Capital in late 2015 as a state-owned financial services company to help it navigate financial markets.

The government announced in 2016 that it was selling company stakes, with some to be sold by the end of that year. Since then it has sold only 4.5% of one company, tobacco monopoly Eastern Company in a transaction in March.

Metwally said the delays had been caused by weak markets, legal hurdles, the readiness of each company’s financial documentation and in the case of some companies a downturn in the business cycle.

Egypt last year released a list of 23 state-controlled companies to be brought to market as an initial batch.

The first sales will be companies already trading on the Egyptian Exchange, most likely Abu Qir Fertilisers and Chemicals Industries and Alexandria Container and Cargo Handling Co., sources familiar with the planned transactions told Reuters.

Metwally, citing reasons of financial compliance, declined to discuss individual companies before they reached the market.

He said stake sales could raise around 40 billion Egyptian pounds, roughly equal to 5% of the stock market’s current capitalisation of 750 billion-800 billion pounds.

Among the hurdles bringing companies to market has been a tangle of ownership structures, with different entities requiring different legal processes for selling their assets.

“We had a few transactions that were held up by this process, but now it’s behind us,” Metwally said.

Plans Affected By Aramco’s Planned IPO

A potential future delay to the Egyptian share sales could be the initial public offering of Saudi Arabia’s state oil company Aramco, which may be announced as early as next week.

“Right now liquidity is being sucked out of the market because of anticipation of the Aramco offering,” Metwally said.

If the Aramco sale raises more than $25 billion, it would make it the world’s biggest IPO.

“Now should it (the Egyptian sales) happen, let’s say, in November, or wait till January or February when the Aramco IPO is out of the way?” he said.

Another stumbling block has been the trade war between China and the United States, which by creating a glut in products sold by some of the companies reduced their prices by 30–40% and temporarily lowered valuations, Metwally said.

He said these issues were all being resolved, paving the way for a possibly rapid roll-out.

“Progress is happening in every single transaction,” he said.

“That might put us in a high-quality problem in the future, in which they’re all ready at the same time, and we’ll just have to schedule them one after the other as part of our capital markets management process.” (Reporting by Patrick Werr; Editing by Susan Fenton)

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world

Egypt’s RiseUp Acquires StarterHub Marking North Africa’s Fastest Exit

October 10, 2019

RiseUp, the one-stop-shop for connecting startups in the Middle East and North African (MENA) region with the most relevant resources worldwide, has acquired StarterHub, the online community for startups and aspiring entrepreneurs, to become RiseUp Connect platform. This acquisition marks the fastest exit in MENA region after one month of StarterHub launch. It also aligns ideally with RiseUp community roadmap and is considered a part of the growth plan for RiseUp Connect, which will make MENA entrepreneurship ecosystem more accessible.

Here Is The Deal

The newly formed platform will operate under RiseUp Connect name, and will acquire the StarterHub name, domain name, website and other resources in its possession. Moreover, it will be led by StarterHub Founder “Amr Hussein” who will also lead on other RiseUp community activities as a Startup Community Manager.
RiseUp Connect will act as a full-fledged platform based on scalable, efficient and easy to deploy technology that creates and drives significant community impact, through insightful and engaging content along with distinctive initiatives. Through Riseup Connect, members will get more exposure to the entrepreneurship community, access to desired business resources and events along with numerous benefits that include mentorship sessions, business resources, event access, and possible discounts and offers.
The online and offline platform will provide for all players — investors, startups, organizations, and media the opportunity to engage, RiseUp Connect will thus help connect entrepreneurs with opportunities, and turn ideas into business.

“We are excited about joining forces with StarterHub. The reason behind our collaboration lies in the common values and vision shared by both entities, which is supporting entrepreneurs in MENA with relevant resources, events, mentorship programs and more. We’re proud to have RiseUp Connect platform that will provide a chance for everyone to get closer to the entrepreneurship community, accurately identify their needs and effectively close any gaps in the ecosystem” Said AbdelHamid Shararaa, CEO and Founder of Riseup.

He added “Entrepreneurs are always looking for that engaging community both virtually and physically. With this acquisition we will be able to complement the great virtual with much more content, training and meetups giving the audiences much more needed resources to thrive their business. They will now become part of the RiseUp community giving them access to all the resources that we have.”

“Partnering up with RiseUp will open many paths for StarterHub to become the largest consortium of fast growth founders communities originating from the MENA region, and will broaden our horizons through establishing more connections in the entrepreneurship ecosystem. As StarterHub founder I’m so excited to join the RiseUp journey to help and empower local entrepreneurs through offering a wide range of relevant resources and giving them more exposure, perks, and business events,” Said Amr Hussein, Founder at StarterHub.

RiseUp was founded in 2013 by AbdelHamid Sharara, with the aim of forming a solid platform that connects startups to the relevant resources. Currently, it has become the one-stop-shop for connecting startups in the MENA region with the most relevant resources worldwide.

Founded in 2019, StarterHub started as an online community for startups and aspiring entrepreneurs, with the aim of providing them with all the necessary business resources, online/offline mentorship, training, events, and workshops. Since its launch, Starter Hub-hosted more than 2,370 founders and business owners along with 2350 active members from 70 countries and 100 cities, StarterHub became the pivot of entrepreneurship conversations on social media, garnering an unprecedented amount of conversations and interactions on their community.

About RiseUp:

RiseUp was founded in 2013 in Egypt and quickly became a grassroots movement that spread across the MENA region and beyond. It catalyzed ecosystems and connected regional startups with global resources, beginning with RiseUp Summit (an annual entrepreneurship event) and growing into a range of products and activities supporting startups, and developing ecosystems throughout the year, including RiseUp Connect, RiseUp Explore, and RiseUp Meetup.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world

Egyptian Ride-hailing For Kids Startup Hive Raises $400,000 In Seed Funding

October 9, 2019

Obviously, apart from Swvl, Hive is a new startup making some big noise in Egypt’s ride-hailing industry. With over $400,000 in seeding funding, the Cairo-based startup would be looking to help Egyptian kids have their feel of the growing ride-hailing industry. To put the facts straight, the startup has to be the first in the world with this idea.

“Hive aspires to create a social impact and contribute towards the development of kids by helping improve their lives. We’re cutting down the time that they would normally spend in their school commute and are offering them safe, reliable and comfortable transportation on a daily basis,” says Mohammad Aboali, co-founder and CTO of Hive.

Here Is The Deal

Hive’s $400,000 latest investment came from Abdelmoneim Al-Adawy, an early Hive adopter who has been using the service for his children since its launch.
The startup plans to use this investment to further improve its product focusing on safety and scale.

A Look At Hive

Founded in 2018 by Abdelrahman Osama, a UX consultant with 20 years of experience, and Mohamed Aboali, who has built different tech products in his career of over 20 years, Hive connects comes with over 20 years of experience of building different technology products, Hive offers subscription-based safe ride-hailing solutions for kids.

The startup has completed over 6,000 trips last school year (September 2018 to June 2019) transporting children to 14 schools in Cairo. It also disclosed it is experimenting with ride-sharing service for kids where parents who have extra space in their cars take other children to school (and back home) and make some money in the process. These rides are 40 percent cheaper than what parents have to pay for regular Hive rides but in this case, there are no contingency captains.

According to Abdelrahman Osama, the co-founder and CEO of Hive, school transportation is only the first phase of Hive’s strategy. Eventually Hive hopes to become the platform for all types of kids transportation

“Hive was born with the vision of becoming the first ride-hailing startup for kids providing them the safety and comfort they need. It serves a large segment as 43.7% of the Egyptian population is under 19,” says Osama.

Read also: Egypt Is Setting Up 7 Technology Parks Across The Country And Launching A $50m Fintech Fund

How Hive Works

To use Hive, parents would first download the app, register themselves, and add the children schools and their home address, and some details about the child(ren).
Hive then receives the requests and creates a group of four children living nearby going to the same school. Hive’s staff then assigns a captain for this group and arranges a meeting between the captain and parents where all the documents including copies of license, national ID, drug tests, and criminal records are present to the parents.
Once accepted, parents pay a small upfront fee and the subscription is activated with the rest of money paid by parents in six monthly installments.
The captain takes children to school and brings them back home on a daily basis.
The parents can track all the rides on the app.
The startup uses a distance-based pricing model with different slabs so parents are supposed to pay the fee based on how far they live from the school.
Parents are however required to pay only a portion of fee in advance and the rest in instalments instead of paying the lump sum amount in advance which is how most of the transporters and schools charge in Egypt.

The children using Hive (on average) spend a lot less time in their commute than those who use a school bus as the cars on Hive’s network transports only four children at a time (in some rare cases when requested by parents, they transport five children but compensate it with discounts).

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world

Egypt’s Ecommerce Startup MaxAB Raises $6.2 million in Egypt’s Largest Ever Seed Round

September 26, 2019

Egypt’s startups have been consistent with fund raising this year, with investors so far almost turning sector-agnostic. The latest to join the train is startup MaxAB — a Cairo-based B2B ecommerce marketplace that connects informal food and grocery retailers with suppliers through an easy-to-use app — which has now raised $6.2 million in seed funding. From available data, this would become Egypt’s largest-ever seed round raised by a startup and in the whole of Middle East and North Africa (MENA)

“Nobody has addressed the underserved retailers before,’’ says Belal El-Megharbel, Co-Founder and CEO of MaxAB. ‘‘Retailers are faced with a limited assortment of products, the hassle of dealing with multiple wholesalers and restricted access to credit facilities. At the other end of the supply chain, the FMCGs have limited visibility on market trends, demand patterns and retailers’ business needs — leading to losing potential revenue opportunities,’’

Here Is The Deal

MaxAB’s round was co-led by Dubai-based Beco Capital (who are making their second investment in Egypt after Swvl), Africa-focused 4DX Ventures, and Endure Capital (that has offices in Egypt and the United States), with participation from 500 Startups, Morocco-based Outlierz Ventures and other local investors.
The startup, with this capital, expects to reach half of Egypt’s population before expanding across different markets, it said in a statement.
The previous highest seed round was of $5.85 million raised by Abu Dhabi-based agtech startup Pure Harvest (it revealed recently that it had closed its seed with $5.85 million in multiple tranches).
Earlier this year, Tenderd, a YC-backed Dubai-based heavy equipment rental marketplace raised $5.8 million in what was the largest seed round of MENA at the time.

Why The Investors Invested

On why the investors invested, Yousef Hammad, Managing Partner at Beco Capital, said:

“ ‘This is Sparta’ was the first impression I got when I met this team of warriors, battling one of the biggest inefficiencies on the country’s balance sheets. By leveraging technology, MaxAB is redefining the grocery supply chain in Egypt to fit the requirements of the micro retailers who make up 90% of the grocery market. The metrics they have recorded in such a short period are impressive, and we expect to continue to see double-digit growth as they scale.”

Peter Orth, co-founder and Managing Partner at 4DX Ventures, said:

“We’ve been consistently impressed with how Belal and the rest of the team have executed, and achieved significant traction in a very short period of time. We believe that their B2B e-commerce model is the right way to serve this significant market, and we’re really excited to partner with the team to drive the next phase of growth.”

What MaxAB Does

Founded (last year) and led by Egyptian and Libyan entrepreneurs Belal El-Megharbel who was previously with Careem and Mohamed Ben Halim who previously worked for Aramex, MaxAB, according to the statement, has already built a stock list of over 600 products which includes groceries, beverages, dairy, confectionery and non-food products.

The Cairo based startup connects brands to retailers via its Android app, closing the gap between these traditional retailers (over 400,000 in Egypt) and FMCGs. It aims to automate and simplify $45 billion FMCG food retail market and claims to have recorded month-on-month growth, with 9,000 activated retailers on the platform already. According to its website, MaxAB has processed over 40,000 shipments to date.

“Brands using MaxAB have access to real-time demand monitoring and business intelligence tools, which improve end-to-end supply chain control, and better forecasting. Retailers in remote and under-served areas will have access to a wide variety of products, the convenience of ordering stock online in addition to second-day deliveries not to mention the added benefit of access to credit facilities,” the startup said in a statement.

‘‘We are using data and analytics to understand purchasing and retail behaviors, as well as make the end-to-end process of brands seamless and convenient. This will enable FMCGs to make informed decisions about their purchasing, which will ultimately have a positive effect on their bottom line and catalyze one of the biggest markets in Egypt. This investment round will allow us to accelerate our growth plans and develop new products and services throughout North Africa using the first of its kind B2B ecommerce platform,”the statement further noted.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world

Egypt’s Career180 raises $100,000 seed for its career services platform

September 24, 2019

Career180, a Cairo-based career services platform that offers different online and offline services, has raised $100,000 as seed funding from EdVentures, the Egyptian CVC founded by one of country’s leading publishers Nahdet Misr Publishing House, that invests in education startups, EdVentures announced today.
Founded in 2016 by Shrouk Alaa and Mohamed Akmal, Career180 labels itself as a one-stop-shop for university students and fresh graduates helps them kick off their careers. The startup offers different online and offline career services through its web-based platform and series of events including one of Egypt’s largest careers events Egypt Career Summit that it apparently co-organizes with Cairo-based Career Advancers.

The online platform offers users to book online mentorships sessions, watch videos that offer career advice and ask questions about topics related to career development.
Shrouk Alaa and Mohamed Akmal, the co-founders of Career180, commenting on the occasion, said, “We have already worked with EdVentures and are very excited about them investing [in us]. The investment will support our expansion plans and enable us to help more [university] students and graduates with their careers.”
Dalia Ibrahim, the founder of EdVentures and the CEO of Nahdet Misr Publishing House, said, “We constantly aim to empower youth and that’s why we are keen to keep collaborating with Career180 by investing in them. The investment will help them expand their valuable services to equip the youth with the necessary skills and capabilities to meet the market needs.”
Career180 aims to use the investment to further develop its online platform and expand its career workshops and events across different cities of Egypt.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world

Egyptian Edtech Startup ‘Knowledge Officer’ Wins $500,000 New Grant In The UK

September 23, 2019

The wave of investment in Egyptian startups this year has been quite remarkable. Knowledge Officer, a London-based edtech startup founded by two Egyptians; Ahmed El-Sharkasy and Ahmed Eshra is the latest to join the train, winning $500,000 (over £400,000) in grant from Innovate UK, United Kingdom’s innovation agency.

Here Is The Deal

The grant called ‘Smart’ according to Innovate UK’s website is for ‘best game-changing or disruptive ideas (from any area of technology) with a view to commercialization.’

Ahmed El-Sharkasy, co-founder and CEO of Knowledge Officer, commenting on the occasion, said:

“The grant will help us scale our ML team in London and support our ambition to help millions of job seekers find the right and proven path to pursue their dream career goals at an affordable price. It’s a huge under-served market and we are here to serve the unserved”

This is a significant amount of money, especially considering the fact that Knowledge Officer’s seed round that it raised in March last year was ~$750,000 (£600,000).
Knowledge Officer in a statement said that they will receive the money after presenting their research and results later this year, to take their platform to the next level.

Why Knowledge Officer Won The Grant

Although Innovate UK says the grant is for the ‘best game-changing or disruptive ideas (from any area of technology) with a view to commercialization,’ Knowledge Officer in a statement noted the grant was awarded based on the significance of the problem Knowledge Officer is working to solve — building the best path-to-employment platform and promoting data-driven learning at scale.

‘‘The Smart grant is awarded to game-changing ideas from business with strong evidence of impact. Knowledge Officer was one of just a few startups selected for the fund from 500 applications,” Knowledge Officer noted in the statement.

It also went ahead to state that winning the grant was further validation of both the problem the startup was looking to solve as well as the approach that it is relying on to execute the problem.

What Knowledge Officer Does

Knowledge Officer which also has an office in Alexandria (Egypt), helps users transition into new careers by analyzing their current skills against their dream career and creating a customized learning path to help them learn the skills needed for the new career of their choice. The six areas that it currently covers include founder, product manager, growth manager, machine learning engineer, marketing specialist, and customer success.

Users are offered curated learning material from around the web that comes with challenges and the option to track one’s progress. The users are required to answer different questions at every stage to advance to the next one and can even compete with their friends on Knowledge Officer.

The platform at different points throughout a user’s learning journey also notifies them when their recently acquired skills match with the relevant jobs on different recruitment platforms.

“In our journey to create the shortest and most efficient path to employment, think [of Knowledge Officer as] Google Maps for learning. We wanted to change the way people perceive learning and transform the overall experience to be based on data and ML. Imagine the impact of a concrete route to take you from your current skill set (Point A) and a transformed, aspirational state (Point B), where you are being offered your dream job.”

Knowledge Officer, according to the statement, has more than 100,000 users now with a few thousand active users on a weekly basis. The startup that offers a premium subscription with extra learning tools to both individuals and businesses aims to reach a stable MRR by the end of 2019 from both B2C and B2B revenue streams.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world

A New Business Angel Network Set To Be Launched In Egypt

September 16, 2019

Egypt is set to host an international investment and entrepreneurship event code named Techne Summit 2019 which will see the launch of the Mediterranean Business Angels Network, the event’s organisers, Egyptian marketing agency Markade have revealed.

Here Is All You Need To Know

The Mediterranean Business Angels Network (Med Angels) launch — will be held on 30 September at Bibliotheca Alexandrina.
The agency said the angels network aims to bring together a large number of business angel networks, groups, funds as well as individual angel investors from across the region.
The angels network aim to co-ordinate with relevant funds from the EU, Africa and Middle East and North Africa regions, while helping other angel networks in the region to add more members and close more deals. The network also aims to launch an accelerator programme.

Techne Summit will be held in Alexandria, Egypt between 28 September and 30 September

Confirmed speakers include Egypt’s ICT Minister Amr Talaat, AUC Venture Lab director Ayman Ismail, Hivos impact investment portfolio manager Keith Wallace, Sawari Ventures chairman Ahmed Alfi and Algebra Ventures managing partner Ziad Mokhtar.
The Techne Summit was first held in Alexandria, Egypt in 2015. Last year, it attracted about 130 speakers, over 6000 attendees, 230 startups and 80 investors from more than 25 countries.
This year’s edition will be held at Bibliotheca Alexandrina in Alexandria from 28 September to 30 September.

Egypt has over the past few years scaled up its entrepreneurial activity, becoming the fastest-growing startup ecosystem in the Middle East and North Africa (Mena) region according to a report by Magnitt.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world

Egypt Is Setting Up 7 Technology Parks Across The Country And Launching A $50m Fintech Fund

September 13, 2019

Egypt ’s Central Bank is set to launch a fund to support fintech startups early next year with a capital of $50–100m. Also, the Egyptian government plans to set up seven technological parks this year in various universities at an investment of EGP 1 billion ($60.8 million), in its drive to foster digital technology infrastructure.

Here Is All You Need To Know

According to Egypt’s government, the parks will be financed through Egypt’s Ministry of Communications and Information Technology’s resources in parallel with the beginning of the new academic year, Daily News Egypt reported.
The ministry is ready to contribute to the fintech fund, which the Central Bank of Egypt (CBE) plans to launch next year, if the latter requests it.
Central Bank of Egypt aims to launch a fund to support fintech startups early next year with a capital of $50–100mln, the report said.

Image result for Egypt Economy facts — click here to view source

Egypt’s ICT sector recorded 16 percent growth in fiscal year 2018/19 and the sector contributes 3.2 percent of the country’s GDP, Daily News Egypt reported citing the minister.

Egypt aims to increase investments in its ICT sector and the ministry intends to increase the ICT contribution in the GDP to reach 8 percent, the report said.

Egypt is also developing a comprehensive legislation system and framework to regulate the ICT sector, through issuing the e-commerce bill and a personal data protection law, Talaat said.

For almost 10 years, Egypt has made a dramatic leap in a number of fast-expanding startups and an amazing set of supporting institutions and communities.

In 2018, Egypt was ranked the fastest growing startup ecosystem in the Middle East and North Africa and the second largest after UAE, according to a report by start-up platform MAGNiTT.

The Egyptian government has also successfully established many incubators, providing a stepping stone for local entrepreneurs. Bedaya, TIEC — Technology Innovation and Entrepreneurship Center, and Fekretak Sherketak are the top incubators founded by the government, offering funding for new innovative ideas.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.

These Four African Countries Control 60 per cent of Africa ’s Digital Economy, says new report.

September 12, 2019

Africa has 54 countries but only four countries dominate the digital revolution going on in the world. According to the United Nations Conference on Trade and Development (UNCTAD) Kenya, Egypt, Nigeria and South Africa are leveraging data and various platforms to collectively control the lion’s share of the continent’s digital entrepreneurship activities.

Here Is All You Need To Know

Apart from the Kenya, Egypt, Nigeria and South Africa, six second-tier countries — Ghana, Morocco, Senegal, Tunisia, Uganda and Tanzania — make up another 20 per cent, while the remaining 44 countries in Africa account for the remaining 20 per cent.
The UN agency, however, warns that the growing digital wave on the continent could be curtailed, particularly in Kenya where the Government is looking for ways to start taxing mobile applications and internet usage.

‘‘While this kind of taxation may be attractive to governments, it can be counterproductive if it results in a decline in economic activity by reducing the number of active internet users,” says the report.

UCTAD said efforts to grow tax revenues could also hurt the growth of the growing online businesses as well as suppress start-ups.

According to the report entitled Value Creation and Capture: Implications for Developing Countries, numerous developed countries are discussing or implementing interim and permanent measures to tax the digital economy.

Read Also: Tax War On Online Businesses: Nigerian and Kenyan Ecommerce Businesses To Pay VAT

These include Kenya, Uganda, Tanzania and Zambia. In Kenya, the National Treasury has proposed imposing an income tax and value-added tax on items bought on different e-commerce platforms. The proposals, contained in the Finance Bill 2019, are currently being debated in Parliament. This is also the case with Nigeria which has proposed to tax all ecommerce companies.

Commenting on the findings, UN Secretary-General António Guterres said digital advances have generated enormous wealth in record time, but that wealth has been concentrated around a small number of individuals, companies and countries.

There Is Wide Disparity In Digital Revolution Across The World

The report also noted that the world’s top digital firms are highly concentrated geographically . Among the world’s 70 highest valued digital platforms, most are based in the United States, followed by Asia (especially China). Latin American and African digital platforms are only marginal. In terms of market capitalization value, digital platform companies from the United States increased their share in the global total from 65 per cent to 70 per cent. An analysis of web traffic data confirms the dominance of the large United States digital platform companies. The report also noted that the United States hosts more than half of the top 100 websites used in 9 of the world’s 13 subregions shown in the table. Even in Western Europe, the most-used websites are based in the United States.

Challenges Confronting Emerging Economies

The report noted that the some of the problems confronting developing economies and other entrepreneurship ecosystems include the small size and scope of their markets.

It is rare for them to be able to reach international markets. In the diverse sample used in one study on Africa, 117 out of 135 enterprises (87 per cent) targeted their domestic markets. Enterprises typically focused on using digital technologies to cater to a nearby niche market, the report notes.

Indeed, few African digital enterprises reach customers beyond the boundaries of their home city. This is because they have to engage with customers directly, and also because only customers in cities have the minimum necessary infrastructural access or technological readiness to engage with a variety of digital products, the report further notes.

The report further notes that Africa still has fewer capital and other entrepreneurial resources than any other regions in the world to boost its digital economy.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.