A new report has estimated that Africa’s internet economy could reach 5.2 per cent of its Gross Domestic Product (GDP) by 2025, contributing nearly $180 billion.
The report, ‘Google-IFC e-Conomy Africa 2020’ was released on Wednesday by Google and the International Finance Corporation (IFC).
It projected a potential contribution of $712bn by 2050.
The report states that driving this growth is a combination of increased access to faster and better quality internet connectivity, and a rapidly expanding urban population.
Others are a growing tech talent pool, a vibrant startup ecosystem, and Africa’s commitment to creating the world’s largest single market under the African Continental Free Trade Area (ACFTA).
Partech Ventures Africa said Africa is home to 700,000 developers and venture capital funding for start-ups has increased in five years, with $2.02bn in equity funding raised in 2019.
The Interim Managing Director, Executive Vice President and Chief Operating Officer of IFC, Stephanie Von Friedeburg, said the digital economy can and should change the course of Africa’s history.
Google Africa Director, Notin Gajria, said Google and IFC have created the report to highlight the role the digital startup sector is playing and other factors driving the continent’s growth, in order to showcase and support the opportunities the continent presents.
Accenture did an analysis in the report showing that in 2020, Africa’s iGDP may contribute $115bn to the $2.554 trillion GDP. This is 4.5 per cent of the GDP, rising from $99.7bn (3.9% of GDP) in 2019.
IFC, a member of the World Bank Group is the largest global development institution focused on the private sector in emerging markets.
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