In an intriguing look at how I.B.M. is seeking to make new telecommunications footholds in Africa, a New York Times article yesterday offered another glimpse into how that continent may be edging closer to becoming an emerging market for technological growth.
According to the story, I.B.M. “will supply the computing technology and services for an upgraded cellphone network across 16 nations (Burkina Faso, Chad, Congo Brazzaville, Democratic Republic of Congo, Gabon, Ghana, Kenya, Madagascar, Malawi, Niger, Nigeria, Seychelles, Sierra Leone, Tanzania, Uganda, and Zambia) in sub-Saharan Africa,” and Indian cellphone company, Bharti Airtel, will be the customer and provide “hardware, software and services to run everything from billing and call-traffic management to delivering new services like music and video” in the region.
Basically, I.B.M will manage Bharti Airtel’s communications network in Africa. Here is a story from I.B.M. on the project. During the last five years, I.B.M. has already spent about $300 million in the continent setting up country offices, supporting technology training programs and adding information centers.
For I.B.M., the partnership signals further technological inroads into what can only be dubbed the slowest developing continent in the world. I.B.M. spokesman Bruno Di Leo said the project was “a huge step forward for I.B.M. in what we think is the next major emerging growth market — Africa,” and The Times article said I.B.M.’s overarching strategy “calls for the growth markets — not only the well-known BRIC countries, Brazil, Russia, India and China, but also dozens of others — to increase as a share of I.B.M.’s revenue from 19 percent to 25 percent by 2015. That is the equivalent of $1 billion in new sales a year. In these nations, I.B.M. is targeting the linchpin industries of economies including telecommunications, banking, transportation, health care and energy.”
Obviously, I.B.M., which saw its stock rise from 116 in May of this year to 130.60 at the close of the market Sept. 18, has the primary goal of moneymaking, as the above quote shows, but there’s an undeniable residual effect here. Although just 40 out of 100 Africans own cellphones, I.B.M. reports that demand is increasing about 25 percent per year, and even within agrarian and fishing industries, cellular communications have proven beneficial in helping businesses succeed by acquiring market values for products in real time, no matter where businessmen happen to be located, either on the farm or at sea.
So, while these are, indeed, very capitalistic undertakings by I.B.M., they do assist in helping developing lands improve their ability to conduct business and make operations, even on an agricultural level, more efficient and productive. Thus, it seems to me that with improved telecommunications infrastructure in place comes the possibility of increased modernization in other industries across the continent.
But that possibility doesn’t look like it can be fully realized in the near term. Problems for modernity in Africa persist. If we look at the map below, we can see that most of the 16 nations falling under the telecommunications network blanket are within a fairly low GDP with respect to the more prosperous north and south regions of the continent, and the nation’s respective governments tell a lot about their abilities (and the leaderships’ willingness) to move forward into a more technological future.
Here are the basic governmental and, when relevant, economic situations of each:
- Burkina Faso — Semi-presidential republic. High emigration rate because of unemployment. One of the lowest GDPs per capita in the world.
- Chad — Corrupt parliamentary republic with powerful president at the helm. The Human Development Index (HDI) from 2009 ranks the nation as the 175th least developed in the world (45th in Africa) based on variables like literacy, life expectancy and standards of living. Larger numbers represent less developed nations. Libya is Africa’s most highly developed nation in Africa, but it’s only 55th in the world, by comparison. Burkina Faso is 177th in the world. The index lists Norway as the most developed in the world at number one.
- Republic of the Congo — Corrupt authoritarian regime. 136 on the above list.
- Democratic Republic of Congo — Again, one of the poorest, if not the poorest, nations in the world. Semi-presidential republic.
- Gabon — Presidential republic and one of the most prosperous in sub-Saharan Africa. If you will notice on the map, this is the only country of the 16 positioned in the dark green, representing a GDP above 4,000.
- Ghana — Constitutional presidential democracy and the second least failed state in Africa behind Mauritius, according to the Failed States Index.
- Kenya — Semi-presidential republic. Low GDP per capita but in the medium stratum, according to the HDI.
- Madagascar — Caretaker government, which can be read as unstable in the long term. Middle stratum on the HDI.
- Malawi — Low life expectancy, but a multi-party democracy. High population and little development.
- Niger — Lowest nation on the HDI. Government: military junta.
- Nigeria — Presidential federation republic. The United States’ largest trading partner in sub-Saharan Africa. Possesses an abundance of natural resources by which to benefit economically.
- Seychelles — Republic. Second highest HDI on the continent.
- Sierra Leone — Constitutional republic. High unemployment but substantial reserves of natural resources like titanium ore.
- Tanzania — Republic with a mostly agriculture-based economy. Resides with the middle stratum on the HDI.
- Uganda — A Democratic republic with a large reserve of natural resources, it rests near the bottom of the middle stratum of the HDI.
- Zambia — Republic. Some 68 percent live below the poverty level, according to the U.N. Zambia is in the lower stratum of the HDI.
So, from all this, we notice that most, but not all, nations in the 16-nation cellular network are, indeed, in need of immense economic, technological, and social development. But a nation’s ability to modernize itself seems to be bound up with the willingness or ability of its leaders to support and attempt to enact measures to further such advancements.
This brief look provides an optimistic picture in my view. Most are, at the very least, operating under ideal governmental conditions, if not economic, for technological changes. The question will be whether a more flourishing telecommunications presence within parts of sub-Saharan Africa can, indeed, foster the kind of economic progress that I.B.M. says it might. I.B.M., after all, has its own interests, with the interests of the African people, of course, being secondary to furthering a successful business. Past that, as ever, it’s in local hands, and in this case, Africa’s hands.Powered by Sidelines