IMPACT OF ICT ON EMPLOYMENT AND POVERTY ALLEVIATION IN AFRICA PRESENTATION TO EXPERTS GROUP

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IMPACT OF ICT ON EMPLOYMENT AND POVERTY
ALLEVIATION IN AFRICAPRESENTATION TO EXPERTS
GROUP

• By
• Dr. M.O. Ubaru
• Director (PRS)
• National Information Technology Development
  Agency - NITDA.
• 19 November, 2009.

ICTs.
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BACKGROUND

• The report outlines the findings of desk research
  and consultations in selected African countries
  on the impact of Information and Communications
  Technologies (ICTs) on employment creation and
  poverty alleviation.
• The countries covered in the study are Egypt,
  Ethiopia, Kenya, Mozambique and Nigeria.

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OBJECTIVES OF THE STUDY

• The objective of the study is to prepare an
  Issues paper on the impact of ICTs on Employment
  and Poverty Alleviation in Africa with an
  emphasis on
• ICT as an economic sector with capacity for
  generating huge employment opportunities and for
  contributing to rapid economic growth and
• ICT as a sector to leverage the growth and
  competitiveness of other African economic sectors

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METHODOLOGY OF THE STUDY

• The study was conducted in a three-stage
  information gathering process
• Desk research using the internet and available
  documentation. This served to generate a
  knowledge base about the general ICT situation in
  the region.
• The research was followed by contacts made with
  key informants in the region for leads, pointers
  and further background documents.
• Then gathering information through interviews
  with the key stakeholders from the public and
  private sectors and ICT users in Ethiopia, Egypt,
  Kenya, Mozambique, and Nigeria (Appendix A and D
  provides information on bibliogrphy and list of
  interviewees in the report).

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Liberalization of the ICT sector the importance
of infrastructure

• The study shows that access to reliable, and
  affordable telecommunications and electrical
  power infrastructure is an important precondition
  for the use of ICT to generate employment
  opportunities.
• Liberalization and the involvement of the private
  sector have hastened the adoption of these
  technologies, particularly in the case of
  Broadband wireless and mobile.
• The study reveals that the African countries
  where the ICT sector have been liberalized tend
  to have higher telecommunications penetration as
  reflected in the increased growth in teledensity,
  more vibrant economy with more jobs being created
  directly and indirectly and more positive impact
  on poverty alleviation than countries that are
  not liberalized.

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Overview of ICT status in selected African
countries
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Active Operators and Service Providers
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Pie Chat Showing Teledensity in Selected
African Countries
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(No Transcript)
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Networked Readiness Index 2006 - 2007
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ECONOMIC REFORMS

• Nearly all the African countries examined are
  undergoing one form of economic reform or the
  other.
• ICT barely mentioned in the Poverty Reduction or
  Poverty Eradication documents of the various
  countries
• The documents did not articulate how ICT could be
  used to drive the development of the various
  sectors of the economy.
• This explains why most of these African countries
  have only been paying lip service to the question
  of ICT for dev. (ICT4D).

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UNIVERSAL ACCESS PROVISION

• Countries such as Nigeria and Egypt have put in
  place Universal Service policies that are
  designed to facilitate the penetration of ICT
  services to rural underserved and commercially
  unviable areas of the countries.
• Mozambique, Kenya and Ethiopia are still in the
  process of developing their Universal Access
  policies.

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HUMAN CAPACITY DEV.

• Apart from Egypt and Nigeria, the study indicates
  that most African countries lack the critical
  mass of skilled ICT manpower required to drive
  and grow the ICT sector.
• This goes to underscore the need for deliberate
  policies to promote the development of the
  required critical mass of skilled ICT manpower in
  the various countries.

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DIRECT AND INDIRECT EMPLOYMENTS

• The study shows that ICT is creating jobs in the
  countries studied through direct employment in
  the ICT industries and indirectly through ICT
  enabled and ancillary enterprises.
• In Kenya, Currently, there is no proper audit of
  the existing ICT human resource capacity. The
  Computer Society of Kenya estimates that there
  are a total of 5,500 ICT professionals in the
  country, with 300500 graduates in computer
  science, electronics/electrical engineering and
  library scientists per year.
• There is need for a strategy for massive capacity
  building to ensure the ready availability of the
  critical mass of ICT skilled manpower required to
  drive the ICT industry.

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DIRECT AND INDIRECT EMPLOYMENTS contd.

• In Nigeria for instance
• Over 10,000 people are directly employed by the
  GSM operators alone while it is estimated that
  1,000,000 indirect employment opportunities have
  been created through the operation of GSM
  (Recharge card hawkers, Resellers etc including
  the umbrella people).
• Also opportunities exist for Nigeria workers to
  serve as expatriates to other countries (Foreign
  input to GDP).
• The registered ICT companies is put at about
  2,000.

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DIRECT AND INDIRECT EMPLOYMENTS contd.

• In Egypt,
• the number of established ICT companies is put at
  1,695 as at 2005.
• The ICT industry provides over 5,000 direct jobs
  and 15,000 indirect jobs.
• Over 113,732 graduates of the special IT training
  programmes of MCIT have all been employed in the
  ICT industry.
• The 10,000 seat Call centre at the smart village
  carries the potential to put 30,000 young
  Egyptian graduates on a steady pay roll.

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ICT BUSINESS PROCESS OUTSOURCING

• Even though the global outsourcing market is very
  huge, most of the countries study are yet tap
  fully into it.
• The study also shows that African countries have
  the potential to participate actively in
  outsourcing and a lot of jobs could be created as
  a result.

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EFFORTS OF THE DIASPORAS

• Just like the Indian example, our finding shows
  that Africans in diaspora could play very great
  roles in ensuring that the respective countries
  take advantage of the emerging BPO and hence
  contribute in no small way to the development and
  growth of the ICT industries in both Egypt and
  Nigeria.

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EFFORTS OF THE DIASPORAS

• For example, the Egyptians in diaspora and the
  Nigerians in diaspora are already playing very
  active roles to ensure that the respective
  countries take advantage of the emerging global
  BPO market

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GENDER INITIATIVES

• All the countries visited recognize the need to
  meanstream gender in ICT programmes
• Egypt is perhaps the only country in all the
  countries studied where women participation in
  ICT is already very pronounced.

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e-COMMERCE

• The lack of a functioning e-payment systems and
  e-signature acts in the countries visited are
  hindering the growth of e-commerce in these
  countries
• There is need therefore, in collaboration with
  relevant stakeholders, to create the necessary
  enabling environment for the establishment of
  e-payment systems.

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COST OF BANDWIDTH FOR INTERNET ACCESS

• Interviews carried out in the examined African
  countries indicate that the minimum Bandwidth
  required for meaningful internet access is 256
  Kbps.
• However, the high cost of bandwidth in most of
  the countries studied has been a major deterrent
  to ICT penetration and hence a major hindrance to
  creation of jobs through ICT.
• The free internet strategy adopted by Egypt is
  worth replicating in other African countries as a
  way of enhancing ICT diffusion.

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ENTERPRENEURSHIP

• In most African countries the education system
  does not emphasize entrepreneurship with the
  result that graduates are always looking up to
  the government to provide jobs.
• It is therefore very expedient that the
  education systems be reviewed to encourage
  entrepreneurship which would encourage young
  graduates to be innovative, creative and job
  creators rather than job seekers.

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e-AGRICULTURE

• The study shows that the value chain created
  through the introduction of appropriate
  e-agriculture programmes holds very huge
  potentials for generating large volume of decent
  jobs.
• For instance the Egyptian pilot e-Agriculture
  programme, the Virtual Extension Research
  Communication Network (VERCON), provides the
  platform for information sharing between
  agricultural researchers and extension workers
  and
• currently there were already 57 nodes in the
  network (5 in central and 52 in 6 governorates),
  and it had already created jobs for over 1000
  workers including 92 extension workers, 12
  researchers, and other workers involved in
  content development.
• It has also contributed tremendously to
  empowering farmers with relevant information to
  boost their productivity and profitability.

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• SUMMARY /STATISTICS OF FINDINGS

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Networked Readiness Index 2006 - 2007
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MAIN FINDINGS ON EGYPTIAN ICT SECTOR 99 - 2005
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MAIN FINDINGS ON EGYPTIAN ICT SECTOR 99 2005
contd.
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MAIN FINDINGS ON NIGERIAN ICT SECTOR 99 2005

• Table Total Connected Lines and Teledensity
  (1999-2006)

1 Teledensity was calculated based on
population estimate of 120 million people. 2
Teledensity was calculated based on population
figure of 140 million people.
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MAIN FINDINGS ON KENYIAN ICT SECTOR 99 2006
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MAIN FINDINGS ON ETHIOPIAN ICT SECTOR 99 2006
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Recommendation

• Following are very important areas where the
  African countries could focus efforts with a view
  to create decent jobs, reduce unemployment and
  alleviate poverty
• Outsourcing
• Community Multipurpose Telecentre (CMCs), using
  post offices as outlets, and combining several
  technologies- radio, GSM, Internet , TV, and
  multi-media
• Market driven e-Agriculture.
• Promoting ICT based SMEs through franchising

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Recommendation contd

• Following are very important with respect to
  alleviate poverty
• Review of education curriculum to meanstream ICT
  in education right from primary school and to
  emphasize entrepreneurship
• Encourage life-long learning, distance-learning,
  e-learning, and re-skilling

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Recommendation contd

• Role of Government
• Creation of enabling environment through
  appropriate incentives
• Education reform with emphasis on
  entrepreneurship
• Creation of IT parks and ICT incubators to assist
  startups. Eg Egyptian smart village
• Promoting ICT based SMEs by facilitating access
  to funds
• Creation of Universal Service fund to facilitate
  ICT diffusion to rural and underserved areas
• Facilitate creation of regional and international
  trade

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Recommendation contd

• Role of NGOs and CBOs
• Advocacy and awareness creation
• Mentoring and training of young entrepreneurs
• Promoting gender issues

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Recommendation contd

• Role of Private sector
• Support RD
• Software development
• Outsourcing
• Mentoring and training of young entrepreneurs
  (Internship)

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Conclusion

• For the African continent to alleviate poverty
  and reduce unemployment, we more than most other
  continents, need to employ a deliberate set of
  strategies and policies that favour the use of
  ICTs in the quest to make our economies more
  viable.
• There is need for the ICT implementing agencies
  in the various African countries to carry out
  further survey with a view to gathering more data
  on the impact of ICTs on socio-econiomic
  development as the available documents are very
  scanty on relevant data.

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Thank you.

• Dr. M.O. Ubaru
• Director Planning Research and Statistics
• National Information Technology Development
  Agency
• (NITDA)
• No. 28 Port-Harcourt Crescent
• Area 11, Garki,
• Abuja-Nigeria
• E-mail mubaru_at_nitda.gov.ng, moses_ubaru_at_yahoo.com