The African continent is heavily reliant on its small and medium-sized enterprises, which are the backbone of the economy. As many countries across the continent have embarked on their digital transformation, a study conducted by Genesis Analytics shows that digital platforms can play a key role in the continent’s development.
The study was conducted in eight African countries: Senegal, Côte d’Ivoire, the DRC, South Africa, Nigeria, Ghana, Mauritius and Kenya – reveals that social media platforms help accelerate economic growth and opportunity across the continent.
According to the results of the study, small and medium-sized businesses (SMBs) are the vehicle to achieve youth employment, gender parity and intra-regional trade in Africa. The report shows that surveyed SMBs that use the Facebook apps have younger employees with an average share of 45% of employees under 30. Additionally, SMBs using Facebook apps reported a higher frequency of being owned by women, while SMBs in the manufacturing sector ranked the ability to access new foreign markets as the most beneficial advantage of the apps.
Commenting on the report, Kojo Boakye, Director of Africa Public Policy at Facebook said, ‘84% of surveyed SMBs reported that Facebook apps have been important for their business growth. This reinforces our commitment to providing the access and skills that help people use Facebook apps to increase employment opportunities, incomes, gender equity and trade.’
Ryan Short, Partner at Genesis Analytics added, ‘The Genesis Analytics study shines a much-needed light on how SMBs on the continent are embracing digital tools and platforms. It shows empirically that the use of digital tools can drive economic growth by bringing more women into the formal economy; creating economic opportunity for young people and boosting intra-African trade. We urge policymakers and digital platforms alike to understand these opportunities and to create an optimal environment for SMBs to thrive using digital tools and social media.’
The report also identified the barriers that policymakers may need to further focus on to increase the adoption and drive significant growth, with expensive internet and data costs and low levels of trust in data privacy being barriers to greater uptake. Resolving these challenges will take close cooperation between governments and private companies to foster a digital environment that can power small businesses to unlock Africa’s rich opportunities.
Access the full report here.