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Opening Remarks by Emily Njeri Mburu-Ndoria at the webinar on Digital Services Trade: Great Potential but Regulatory Frameworks Are Urgent

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Excellencies, Distinguished Panellists, Ladies and Gentlemen,

Greeting from Accra, Ghana

On behalf of H.E the Secretary General of the AfCFTA Secretariat, we are very privileged to co-lead with the United Nation Economic Commission for Africa (UNECA) this week’s activities of the Africa Dialogue Series (ADS 2023).

Today's dialogue focuses on the potential of Digital Service Trade in Africa and the urgent need for Regulatory Frameworks to maximise the potential.

I am sure, we will all agree that Africa’s digital ecosystem offers massive potential to spur economic growth, promote opportunity, advance social equality and gender equality, and create jobs.

By some estimations, the digital economy could contribute US$180 billion a year to the African economy by 2025, increasing to US$712 billion a year by 2050.

Again, other research shows that if internet use across the continent could be expanded at the same rate as its use in high-income countries, potentially 140 million new jobs would be created and US$2.2 trillion would be added to the continent’s GDP.

Since 2020 the Covid-19 pandemic has accelerated African digital innovation in a wide range of sectors and increased demand for more digital infrastructure and services across the continent.

However, while access to the internet and digital technologies in Africa is growing, it still lags behind the global average.

Also, despite the bold aspiration and plan to promote digital trade in Africa, the volume of digital trade is very low in the continent compared to other regions of the world. UNCTAD (2022), for instance, found that “while over half the population in high-income countries shopped online in 2019, this figure was only 2 percent in low-income countries (including most African countries)”.

There are also differences among African countries in their experience in digital trade, even among the largest economies in Africa based on GDP.

These variations may be attributable to many factors, including the non-existence of enabling legal, policy and institutional frameworks on digital trade, infrastructure gaps, capacity limitations and cultural resistance to digital ways of trading.

Notwithstanding the above challenges, many experts agree that Africa has huge potential to use digital trade for the benefit of its population provided appropriate regulatory, legal and institutional frameworks are adopted.

Digital regulation can help unleash the potential of digital transformation for Africa’s development and it is also needed to keep abuse in check and ensure security. The latter is notably important when it comes to regulating the growing power of a limited number of tech companies, the use of personal data, or fighting the spread of disinformation and cybercrimes. It also includes strengthening fiscal oversight to prevent the big tech giants, and others, from circumventing the local tax systems in Africa.

Clearly, the choices that we make in this area will have major implications for the type of digital economy that emerges on the continent.

Instructively, many governments and the African Union, have already adopted digital transformation strategies and implemented regulatory changes with the aim of pursuing universal digital access, encouraging private-sector investment, opening new markets and driving socioeconomic development, among others.

With the operationalisation of the African Continental Free Trade Area (AfCFTA), we have an important vehicle through which member states can formulate and harmonise their digital policies and rules and cooperate to expand trade on the continent.

The AfCFTA Protocol on Digital Trade, which is currently being negotiated, can establish the requisite regulatory environment and legal architecture for trade across the continent to be further harnessed, in line with other continental initiatives such as the AU Digital Transformation Strategy for Africa which seeks to build a Digital Single Market in Africa by 2030.

The Protocol would also support and take into account the objectives of other protocols under the AfCFTA, such as those on investment, intellectual property rights and competition policy. These protocols will necessarily work in conjunction with one another as their subject matters overlap.

Successful conclusion of the negotiations on digital trade within AfCFTA would also help create the continental foundations and principles for future negotiations between African countries and third parties. By articulating a common African position, the protocol could further help Africa achieve more in those other negotiations by negotiating collectively rather than on individual country basis.

Our long-term goal is to create a single and secure digital market across Africa alongside free trade area on the ground.

This will require large investments in broadband connectivity, secure data infrastructure, and the governmental and legal reforms that can facilitate competition.

Financing and investments in the infrastructure that builds connectivity is therefore vital. And these investments must be accompanied by policy and regulatory reforms that create a safe and attractive environment for private investors. Strong continent-wide cybersecurity will also be important for building trust and ensuring Africa’s digital single market works safely and securely.

The AfCFTA Secretariat is committed to promote and harness the digital economy as an engine for Africa’s growth and development. More digital trade means more jobs for the teeming, youthful African population, providing them with higher quality of life, which is the Africa we want.

Thank you.

General Information

High-level Policy Dialogue

Sub-theme 3: Digital Services Trade: Great Potential but Regulatory Frameworks Are Urgent

Sub-theme 2: Growing Middle Class and Continental Import Substitution – Connecting the Dots to Unlock Made in Africa

Sub-theme 1: Boosting Trade Facilitation and Rethinking the Foundations of Africa’s Export Diversification

Opening Messages

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