How IT can Impact Sustainable Development in Africa
A few weeks ago I had the pleasure to attend a conference on responsible supply chains at Stanford. One of the presentations was titled “How can oil filters save Africa?” The title made me curious because my initial thought was that an oil filter would pollute rather than save Africa. However, the story was not so much that there were too many oil filters but not enough. And sometimes, a missing oil filter in a motorbike or car, or not having the right filter, can cause an otherwise functioning vehicle to stop working. And this can then be the reason why medicine or vaccination is not at the right place at the right time, with serious health issues and even death as a consequence. At the end of the day it was about managing a very simple supply chain, using the example of oil filters, in a highly constrained environment.
So I thought if oil filters can ‘save’ Africa, what potential postive impact could IT have? Of course, there is the digital divide and one might say Africa needs many other things before IT comes into play. True and not true. True, because it is obvious that there are many rural areas where food security, supply of clean water, and electricity are not a given. Not true, because IT is in fact already there.
Let’s take Ghana as an example. 15 years ago I worked as a software developer in Ghana’s capital Accra. In Germany I was working with a 486 processor and I was very much astonished when in Accra a 386 machine was waiting for me. So the available technology and software was not far behind European standards. Today, 60% of the world’s population have a cell phone, 23.5% have access to the web. Both numbers are growing extremely fast. According to the CIA fact book for Ghana, the cell phone coverage there is 37% (in comparison: coverage for main lines in use is 1.5%) and 3% of the population has web access. And this data is already two years old. So IT is in fact available, gaps are closing fast and cell phones play a very important role in not only verbal communication but also data exchange and web access. So why not leverage it for socially sustainable development?
When we look at the inhibitors of economic development, then very often the following characteristics of the economic base of the pyramid (BOP) are mentioned:
1: Significant unmet needs like water, health, electricity but also needs for communication (cell phones) and access to financing.
2: Dependence on informal or subsistence livelihoods with no access to markets.
3: Base of pyramid penalty impact: being poor often results in paying higher prices or getting lower quality (or both).
Well, the good news is that there seem to be already a couple of good examples where IT is used to overcome these challenges.
Significant unmet needs
- Access to capital through micro financing has caused a revolution in economic development not only since Professor Muhammad Yunus and the Grameen Bank won the Nobel Peace Price in 2006. And access to financing is meanwhile even supported through IT. The WIZZIT Bank is working on mobile banking services for poor people in rural South Africa, where mobile banking payment services and easy account opening in areas where three in five people are not serviced by banks, are mayor focus areas.
- Health is another basic unmet need: Ideas for ICT projects for African health cover education via satellite to health workers in selected remote areas, e-communication between healthcare facilities in isolated areas, and development of ICT infrastructure with databases of health and geographical information.
No Access to markets
- The ITC e-choupal in India is one of the early projects where not only IT but even already the Web has been leveraged to connect local farmers in India to global markets. Started with soy beans the project helped farmers to get better information on market prices via the Web and with that decreased their reliability on middlemen, who worked ineffectively, frequently dishonestly and did not pay farmers a fair price for their beans. In addition to market information the IT and the Web was also used to educate farmers how to increase productivity and yield quality. Meanwhile the project has been extended to several other crops and live stock. According to Wikipedia, the plan is to scale up to 20,000 e-Choupals by 2012 covering 100,000 villages in 15 Indian states, servicing 15 million farmers – that sounds pretty ambitious.
Base of pyramid penalty impact
- Many poor people face the challenge that they not only have less money to buy goods and services, they also have higher ramp up costs to even be able to get access to the goods and services they are interested in. For example they often pay more for the transportation to reach a distant hospital or clinic than for the treatment (source). The Collaboration at Rural project in South Africa, driven by SAP Research addresses this issue. Small retailers who had to drive long distances with public transport to fill up stock for their shop can now send orders via SMS to so called “infropreneurs”, who not only pick up the orders but they also consolidate orders from several shops to be able to buy larger amounts and hence get lower prices.
Interactive children education in Ghana is an interesting example because IT is not only used as a means to solve an issue, in this case primary education. Here, the software development is considered a business, driven by young Ghanaian software engineers. So IT as an opportunity for career development and employment can play a major role in economic development. India is the best example about this potential of transforming a whole economy.