Category Archives: Commerce & Finance Tech

Africa Can’t Leapfrog Industrialization without Infrastructure – Harvard Professor

The wide adoption of mobile phones in Africa, along with finance technologies like mobile banking and e-commerce, the use of drones to transport medical supplies,  the dramatic drop in the cost of solar energy and a lot more accomplishments in other sectors like energy, education, health, transportation, and agriculture points to the widespread adoption of new technologies across Africa.

The success of M-Pesa, a cell-phone-based mobile banking application with 30 million users across 10 countries, threatening to disrupt traditional banking systems around the world  has served as an inspiration to young Africans and has created remarkable technological enthusiasm on the continent.

These successes inevitably lead to talk about how Africa is “leapfrogging” more advanced economies. Leapfrogging, in this context, is when countries skip a step in development thanks to rapid innovation—from no phones to smartphones, for example. The mobile phone, in this context, has allowed African countries to avoid the heavy investments required to build fixed-line networks.

But Professor Calestous Juma of of the Practice of International Development at Harvard Kennedy School, faults this approach  in his recent paperLeapfrogging Progress, The Misplaced Promise of Africa’s Mobile Revolution. He said,

Overall, the mobile revolution has given hope to Africans that they too can be dynamic and innovative players in the global economy, transcending the continent’s current reliance on raw material exports. But while cases such as M-Pesa offer inspiration, the promise of leapfrogging remains largely unfulfilled.

Juma explains that the failure of the mobile revolution going on in Africa to stimulate industrial development in Africa is partly as a result the  assumption that Africa can leap into the service economy without first building basic infrastructure and a manufacturing base,  which he referred to as a faulty narrative.

Juma, a well-respected advocate for the role of entrepreneurship and technological innovation in Africa’s development, says that African policymakers should revisit their respective industrial policies as there is no shortcut to industrial development.

He points out that no advanced economy got where it is today by cutting corners and sidestepping (that is, leapfrogging) industrialization. He reminds us industrialization requires infrastructure and insists that leapfrogging is not the answer:

Infrastructure is both the backbone of the economy and the motherboard of technological innovation. African countries need adequate infrastructure to realize their full potential.

It is not too late for Africa to become a dynamic and entrepreneurial region driven by innovation. It is certainly right to keep its sights set on technological innovation as an essential driver of economic growth, and as the key to moving beyond the vagaries of commodity exports. But such innovation will depend on industrial development — and the infrastructure and technical capacity it enables — that cannot be leapfrogged.

Moving Africa from its current focus on raw material exports, value addition, and consuming technology to becoming a learning economy and technology producer, will require 21st-century industrial policy that supports continuous interactions among government, industry, and academia in open competitive and collaborative innovation ecosystems. Leapfrogging particular technologies, such as landlines, may in some cases be an option. But industrialization itself, and the innovation and development it generates, cannot be skipped over.

This App Let You Buy About to Expire Food at a Discount in Nigeria.

“I remember most times there was little or no food [in the house],” he told CNN. “I had to go to school without food and got by with snacks friends shared with me.” .

“I always said in the future I would do something to ensure others wouldn’t go through what I went through.”

Fast forward to 2017 and Ekponimo, now a software engineer, is doing exactly that through his web app Chowberry.

The app connects supermarkets to NGOs and low-income earners, allowing them to buy food that’s about to expire at a discount.

Ekponimo says the response to the project has been encouraging and he’s been able to see first hand how it’s transforming lives.

“We met one lady who has six children and survives on 400 naira ($1.05)a day,” he said. “She sells firewood and kunu (a local drink). One day the task force seized her kunu for hawking in the street, and she had nothing. She had to feed her family on what she made. So it’s nice to see the impact of what we’re doing.”

A three-month pilot involving 20 retailers reached about 300 people in Lagos and Abuja, feeding 150 orphans and children at risk.

Growing up Oscar Ekponimo was familiar with hunger. After his father had a partial stroke, he was temporarily ill and unable to work, leaving the family struggling to make ends meet.


He is hopeful that more national retailers will join the scheme as demand for the service continues to grow in the face of Nigeria’s recession.

“We went from about 1,500 daily visits to double that. There have been requests and demand, people tell me we really want this, we’re relying on what you guys are doing because things are expensive.”

Hunger and food insecurity are problems still plaguing the continent. The UN Food and Agriculture Organization estimates that 223 million people in sub-Saharan Africa were hungry or undernourished in 2014-2016, the second largest number of hungry people in the world.

According to the World Food Programme, Nigeria is a ‘food deficit’ country, meaning that it cannot provide enough food for its population.
Widespread poverty, inflation and insecurity have been cited as contributing factors to Nigeria’s hunger problem.

Last year, the UN revealed 14 million in the northeast of the country need urgent humanitarian assistance because of the ongoing Boko Haram conflict and warned that 75,000 children could starve to death in months.

Last year, Ekponimo won a Rolex Award for Enterprise for his work and has hopes to expand.

“It’s been a wonderful journey,” he said. “We’re expanding our work and working on scaling to other parts of the country and to other regions and possibly replicating it in other parts of the world.”

Source: CNN

How BuyPower is easing the pain of utility payments in Nigeria

Benjamin Ufaruna and Asehinde Oladipo met at one of Nigeria’s emerging technology development services companies in Abuja. In the hard-charging startup world that the two men entered there was little time to remember the minutiae of everyday life — like paying bills on time.

“In the midst of our busy schedules we would try to find time to dash down to the electricity company to get electricity for the house,” Ufaruna said. Sometimes they wouldn’t make it in time.

“If they are closed you have to stay in darkness til Monday when they open,” said Ufaruna. “You have circumstances where people are traveling and they have to come to the utility and there are long queues.”

Some weekends, Ufaruna said he would see dozens of people milling around outside, waiting for the chance to get to the power company to pay their bills.

“It was that frustration that convinced us to do something about it,” Ufaruna said.

The men rallied utilities in Abuja to start working on the problem. Over the course of 2015, they pitched BuyPower, saying they would handle the cost of rolling out a payment service, all the utilities had to do was integrate with their software.

That proved to be a challenge in itself. “They had a very antiquated technology,” said Ufaruna. So with his partners, Ufaruna set about upgrading the back end of the utility’s payments system.

“We started doing the cleanup and that was the first layer of the challenge. It took us a half-year,” says Ufaruna.

By April of 2016, the co-founders had a product. They did a small email blast to their followers and rolled up their first 50 customers by the end of the day.

Now, the entrepreneurs have 40% of the paid electricity market in Abuja, all without spending a dime on marketing, according to Ufaruna.

Buypower is already generating $1 million in revenue a month, by charging utilities a percentage of every power purchase and a 50 cent fee for each transaction.

Only available to homes with net metering, who are pre-paying for electricity, BuyPower’s founders are already thinking about next steps and looking to expand into the water business.

“We’re going to expand the services that we have right now,” says Ufaruna. “Because we have this high engagement we don’t need to spend to acquire new business from the same customers.”

Roughly 35% of the company’s customers live in the suburbs surrounding Abuja, while another 50% are based in the capital itself.

“We have deep roots in two cities right now (Abuja and Jos) [and] we will expand beyond these cities after demo day and fundraising. Once we have integrated with all the utility companies in Nigeria, then we will go into our next vertical,” Ufaruna wrote in an email.

Source: Tech Crunch