E-Business
Can e-commerce be Africa’s Economic Goldmine?
By Adeniyi Ogunfowoke,
The digital economy in Africa is snowballing, and in the process, it’s creating new jobs and opportunities for digital entrepreneurs to explore a larger web market. Though e-commerce represents only 0.6% of all the transactions done in Africa, as compared to 12% in the USA and 20% in China; the budding nature of the industry does rightfully make one muse on the possibility, that e-commerce is indeed Africa’s economic goldmine.
Facilitation of Cross Border eTrade
The global market has shrunk to a large scale and is now enabling billions of people to sell and purchase products across borders. This has been made possible by technological innovations that have birthed online marketplaces that enable e-trade between businesses (B2B), between consumers (C2C) and between businesses and consumers (B2C).
The opportunities presented by e-commerce are numerous. Africa is a massive market with a growing population of 1.28 billion people, a network of over 15 million SMEs and merchants, and a rising internet connection of 453 million users. Jumia, the leading pan-African e-commerce platform has been at the forefront of Africa’s cross border e-trade revolution. The marketplace is enabling about 81,000 active merchants across Africa, which sometimes source products from international markets, to capitalize on a huge €1.4 trillion consumer market opportunity in Africa.
While the milestone has been remarkable, Nicolas Martin, EVP – Marketplace & Logistics for Jumia, noted, at the 2019 UNCTAD’s Africa Ecommerce Week, that “more needed to be done to tailor bespoke regulatory solutions for Africa to attract international investment and create a conducive environment”. Good payment services are critical in curbing online fraud facing sellers. African governments also need to implement friendlier online taxation policies, to avoid locking out potential entrepreneurs and investors from exploring the ecommerce markets.
Besides, while some marketplaces are creating sustainable logistics systems, the consistent success of cross border commerce will require further and deeper cooperation among stakeholders, both in the private and public sectors. “The power of the marketplace is huge, and the coordinated effort of millions will bring about the change we need in Africa,” added Nicolas Martin.
Powering Employment in Africa
The World Bank reports an alarming rate of unemployed youths in Africa, accounting for about 60% of the unemployed workforce. Bearing in mind that the average age in Africa is 20 years, we need to rethink ways in which to power employment in a continent whose population is estimated to grow to 2.5 billion people by 2050.
Some policymakers are already hitting the nail on the head with the unemployment menace. Not long ago, the Boston Consulting Group (BCG) released a mind-joggling report on how online marketplaces could create 3 million new jobs in Africa by 2025. According to the report, these ecommerce platforms, which match buyers and providers of goods and services, could also boost inclusive economic growth with minimal disruption to existing businesses and workforce norms.
For instance, Jumia, one of the case studies in the report, is already creating 5,000 direct jobs across the 14 African countries in which it operates. This is besides indirect jobs created with sellers, logistic partners, commercial agents, and marketing partners. Other positive economic impacts of online marketplaces in Africa include increasing vendors’ income through surging demand for goods and services in locations currently beyond the reach of conventional retail networks. Furthermore, they are bringing more women and youth – who in some countries have been marginalized from the labour market – into the formal workforce.
Customers’ access to product choice
Choice, convenience and affordability are some of the top benefits customers get from e-commerce. From electronics to fashion, cosmetics, FMCGs, travel and accommodation, online food delivery and payment options, customers are looking for variety and ease of access to their preferred products and services from a one-stop-shop. Ecommerce platforms provide customers with a pool of diverse sellers, that they would otherwise have no access to through offline channels. Notably, there exists low retail penetration rate in Africa, with 1 shop for every 67,000 people as compared to 1 shop for every 1,000 people in the USA.
Conclusion
E-commerce potential to boost Africa’s economy is undeniable. Yet, it’s effectiveness will require the development of the right skills across the various pillars of the industry, among them engineering, marketing, logistics and management. There needs to be an existing conducive environment for doing business at the countries’ level and in the continent at large. This will give both domestic and foreign investors more confidence and encourage budding entrepreneurs to test the e-commerce waters in the continent. The ripple effect being, stronger economic growth!
E-Business
Microsoft to Boost AI Growth with $80Bn Investment
Microsoft has announced plans to invest $80 billion in the 2025 fiscal year to expand its data centre infrastructure.
The investment will focus on supporting the training of artificial intelligence (AI) models and the deployment of AI and cloud-based applications.
The company disclosed this initiative in a blog post on Friday, emphasising its commitment to advancing AI and cloud technology.
Since OpenAI launched ChatGPT in 2022, investment in AI has surged as businesses across sectors strive to integrate artificial intelligence into their products and services.
AI requires enormous computing power, pushing demand for specialised data centres that enable tech companies to link thousands of chips together in clusters.
Before now, Microsoft has invested billions of dollars to enhance its AI infrastructure, broadening its data centre network.
Analysts project Microsoft’s fiscal 2025 capital expenditure, including capital leases, to reach $84.24 billion, according to Visible Alpha.
The company’s capital expenditure in the first quarter of the fiscal year rose by 5.3% to $20 billion.
As the primary backer of OpenAI, the tech giant is considered a leading player among Big Tech companies in the AI race, owing to its exclusive partnership with the AI chatbot developer.
More than half of Microsoft’s $80 billion investment will be allocated to the United States, Brad Smith, vice chair and president noted in the blog post.
“Today, the United States leads the global AI race due to the investment of private capital and innovations by American companies of all sizes, from dynamic start-ups to well-established enterprises,” Smith remarked.
E-Business
NDPC to Impose Heavy Fines on Defaulting Data Processors, Controllers this Year
Nigeria Data Protection Commission (NDPC) has announced plans to significantly ramp up enforcement and impose substantial fines on data controllers and processors that violate the Nigeria Data Protection Act (NDPA) of 2023.
This was disclosed by Dr Vincent Olatunji, national commissioner/CEO of the Commission, in a video message outlining the Commission’s 2025 agenda, shared on the agency’s social media platforms.
A statement issued by the Communications Division of the Commission on Friday quoted Dr Olatunji as saying that, “For data controllers and processors, there is going to be massive enforcement. We have never really issued any fine, but going forward, you’ll hear us giving heavy penalties.”
He assured Nigerians that their data rights, as guaranteed by the NDPA, will be fully protected, and defaulting data controllers and processors will face strict consequences.
The Commissioner highlighted the NDPC’s extensive engagements with stakeholders across public and private sectors to promote awareness and compliance with the Commission’s mandate.
The efforts, he said, have resulted in the signing of Memorandums of Understanding (MOUs) with key organisations, including the National Insurance Commission (NAICOM), National Lottery Regulatory Commission (NLRC), the Data Privacy Office of Canada, and the Dubai International Financial Centre Authority (DIFC), among others.
Dr Olatunji also shared that the NDPC will advance to the second phase of its Strategic Roadmap and Action Plan (NDP-SRAP 2023-2027) in 2025.
This phase is expected to create job opportunities within Nigeria’s data protection and privacy ecosystem, particularly for young people.
The Commission has been actively training Nigerians in data protection and privacy, creating a pool of globally competitive experts within the data protection sector in 2025.
“There are a lot of data controllers and processors that are looking for people to work with them. Now those that we have trained in 2024, those we have certified, we are going to do more this year to actually launch them to the job market where they can really work with data controllers and processors,” he said.
Additionally, the NDPC will continue nationwide efforts to promote data protection awareness.
The Commission aims to educate citizens about their rights and the importance of data privacy while reminding data controllers and processors of their obligations under the NDP Act.
Dr Olatunji emphasised that these initiatives are part of the broader goal to embed a culture of data protection and privacy in Nigeria.
As part of its international engagement efforts, Nigeria will host the “Network of African Data Protection Authorities Conference” in May 2025, with over 40 nations with existing data protection laws expected to attend.
According to Dr Olatunji, this global event will position Nigeria as a leader in the data protection ecosystem, and bring significant economic benefits to the country.
The NDPC reiterated its commitment to ensuring data protection and privacy become integral to Nigeria’s digital landscape, building trust and fostering economic growth, the statement added.
E-Business
NIPOST Reports 275 Percent Revenue Growth in 2024
Nigeria Postal Service (NIPOST), achieved a 275 percent increase in revenue for the year 2024, according to Tola Odeyemi, postmaster general.
At the beginning of the year, NIPOST set an ambitious target of generating N10 billion in revenue.
Although specific figures for the end of the year were not disclosed, the reported increase suggests a significant recovery for the postal service, which had previously faced consistent decline.
Odeyemi, who made the disclosure while listing NIPOST’s achievements for the year recently, attributed the growth to a series of reforms aimed at enhancing service quality and eliminating revenue leakages
The NIPOST boss detailed the steps taken to boost revenue, noting the implementation of Point of Sale (PoS) terminals in high-transaction areas, which has streamlined payment processes and improved customer experience.
She said, “One of the major achievements for us in 2024 has been a 275% increase in revenue from 2023. We achieved this by plugging a lot of the revenue leakages that we have by deploying PoS terminals for payment in our high transaction areas, as well as ensuring that our quality of service goes up.”
Looking ahead, Odeyemi outlined NIPOST’s plans to sustain this growth trajectory.
She said the organisation has embarked on renovations and upgrades of key locations in Abuja, Lagos, and Kaduna, alongside enhancements to the Postal Institute, which is central to the agency’s change management initiatives.
Furthermore, she stated that NIPOST is gearing up for several major developments in 2025, including the rollout of a national addressing system and digital postcode services, specialised logistics for agriculture and healthcare, and a relaunch of its financial services.
“There will be infrastructure upgrades, which will take place across the Federation and there will be an increase in access to government services through your local NIPOST location,” she said.
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