Africa should take a leaf from China on tech


For over 40 years, China’s economy was poor, stagnant and isolated from the world. However, once they opened up, things turned for the better. Now, the country is one of the fastest growing economies around the world. Among the sectors to flourish as a result is the technological industry. The country is investing highly in research and development, making it one of the most advanced economies.

Africa can learn and follow in the footsteps of China to help its technological sector reach a similar feat. To reach its current level in the tech sector, the industry required funding in terms of investment. This resulted in the Chinese  government investing in infrastructure such as providing tech hubs that would focus in the innovation of technologies such as big data and artificial intelligence.

One of the biggest challenges for most African tech start-ups has been a lack of investment. Many youths have technological ideas able of transforming their regions for the better but due to a lack of funds their ideas do not transform into reality. Matters are even worse with the Covid-19 pandemic as fund taps from the West that go into nurturing Africa’s budding tech innovators have dried up.

In addition to acquiring investment, China’s tech giants had an advantage as they were the initial players in the sector thus, they faced minimal competition, giving them a chance to expand at a fast rate. Some of the Chinese companies to profit from this include Baidu, Tencent and Alibaba. In contrast, their U.S tech counterparts such as Netflix and Apple had to outpace their competitors to come out on top.

Despite Africa already having a number of leading tech companies such as Safaricom, there remains a lot of gaps that tech start-ups are aiming to fill, making them pioneers just like the likes of Tencent. This puts them at a great opportunity of expanding faster and capturing a larger market.

Being a large economy, China’s tech sector has also prospered as it has blocked a majority of global services from operations within its shores. Services such as Google, Facebook and Instagram are not allowed within its borders. Instead, the country has its own services to replace these global giants. For instance, china has the likes of WeChat which is popular not only in China but in Asia as a whole. This has allowed its applications to expand and be able to compete on the global scale.

However, the ban of the global services may be a dilemma to impose in African countries for now, there is a need to support our local tech services to ensure their growth. In doing so, we will be able to come up with more tech solutions such as M-Pesa that can compete around the globe. With such services and applications, in the near future, Africa will be able to depend on its own products and services. This will surely not only help the Continent to reduce its dependence on the developed economies but would also help the economy to prosper.

The reason as to why applications such as WeChat have grown in popularity around Asia is due to the policies of China to smoothly venture into other countries through agreements, investments and acquisitions. Unlike most companies from the West who would rather have their presence in foreign countries, China is welcome to partnerships with companies from other countries for better transition. An example includes Alipay, an online payment platform, which has partnered with GCash, a Philippines telecommunications service provider, to launch of a cross-border remittance service through their e-wallet platforms.

A number of African companies have already followed a similar path as they have ventured into other African countries. Safaricom, for example, is evident in a number of countries in Africa. However, only a particular number of companies are in a position to pull this off due to the different restrictions among different borders.

This although, could be changing soon as AfCFTA is almost fully operational leading to the opening up of borders. As a result, more African companies will be in a position to venture out to different countries within Africa helping them expand and profit. 

Africa is at a better stage than China was 40 years ago. Policies and investments will be crucial to assist the technological sector to improve. We have witnessed the importance of technology during the Covid-19 pandemic. Technology is a tool that is able to improve the lives of Africans as it did for China. However, there is also a need to improve infrastructure and increase connectivity around Africa. We have seen applications like TikTok become worldwide favourites in a short time and bring profits for their home country, it is time Africa emulates the same. 

Writer is a member of NBM’s inhouse editorial team and lead business researcher

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