Internet opens new markets for Africa

Many practical benefits for business, farming, health and education

By Mike Jensen

In Niger, Tuareg craftspeople are using the "virtual market" of the Internet to sell their products worldwide. Their crafts appear alongside many other African cultural products in a "cybermall" hosted by a Canadian charity which helps developing countries promote exports and trade. Across the continent, in Tanzania, Sangare Clearing and Forwarding, a small African shipping company that serves as agents for FedEx and Airborne Express, has eliminated one of its biggest expenses by using e-mail to send through waybill numbers and delivery times, instead of going through three or four rolls of triplicate telex paper.

As in most other developing regions, the Internet in Africa has held special attraction for those engaged in trade and trade promotion. The potentially low cost of access to the Internet and its rapidly growing penetration (especially in the developed countries, which have the largest markets) offers new opportunities for poorly financed suppliers to reach buyers at any distance. As many potential products do not have well-established distribution channels, new relationships between buyers and sellers are being built through the Internet.

The Internet has spread rapidly through Africa over the last two years — at the end of 1996 only 16 countries had access, now over three-quarters of the 53 capital cities are online and soon almost all of the remaining ones will have full Internet facilities. Only Eritrea and the Republic of Congo (Brazzaville) are likely to be still "off the net" by the end of the year.

Access still limited

However, Internet services in the main cities cannot provide access to the 70 per cent of Africans who live in rural areas. A few countries do have access points in the second major city, but for most people it is still a prohibitively expensive telephone call, even when a computer, phone line and the necessary skills are available. Since most of these are in seriously short supply, there currently are only about 100,000 Internet users in Africa (excluding South Africa). At about one Internet user for every 5,000 people, this is well below the world average of about one user for every 40 people — and far behind the average of one Internet user per every 3-6 people in most countries of North America and Europe.

African policymakers and their international partners are seeking to address these startlingly low figures through a number of national and regional projects through the African Information Society Initiative (see Africa Recovery, March 1998; a full listing of projects is available on the Web at http://www3.sn.apc.org/africa/projects.htm).

Given Africa's need for improvements in more basic necessities such as clean water, the current interest in bringing Internet connectivity to all corners of the continent may seem out of place. Moreover, the investment necessary for providing even basic telecommunication services in rural and outlying areas may not be justified on economic grounds, since many people have so little income.

However, recent developments in the information and communications revolution — including the convergence of the television, telephone and computer — promise to provide completely new ways to deliver basic broadcast and communication services at far less cost in the future. This may make it possible for Africa to bypass the massive capital investments in older communications systems that the developed countries had to make, enabling the continent to leapfrog some stages and move directly into the information age. Yet, many of these technologies are very new and African telecommunications monopolies are only now beginning to open up, so there are currently few large-scale demonstrations in Africa of the benefits achieved through widespread access to communication and information.

Ingenious uses


Despite these hindrances, there are numerous examples of the ingenious uses to which low-cost communications already are being put in Africa. Electronic mail in particular has been adopted by almost every agency with international communication needs, largely because of its drastically reduced costs: instead of a one minute international fax call costing up to $20 in some countries, a one page e-mail requires a local call of only a few seconds.

For African businesses, such a cheap and rapid means of communication can greatly improve efficiency (see box). Companies and individuals purchasing office supplies, for example, are now able to compare prices of local equipment with international markets and negotiate substantial discounts with local suppliers.

Several governments, as in the Seychelles, are actively promoting conservation and ecotourism through the Internet. Many small local organizations also benefit, such as the Chimfunshi Wildlife Orphanage Trust, which promotes sponsorship of its chimpanzee conservation programme and game reserve in Zambia via the Web. Many government departments, especially ministries of health, now are beginning to use e-mail for their administrative functions. Access to the world's best specialists is now a possibility as well — a doctor in Kenya recently solved a life-threatening case of malaria with complications by using HealthNet Kenya's low-cost e-mail service to connect him to experts in the US who quickly developed a specialized drug treatment programme.

Farmers also are starting to realize the benefits of direct access to the latest produce market quotations to negotiate better local prices for their crops, and many are exploring new avenues for international trade. For example, assisted by the Environment Liaison Centre International (ELCI) in Nairobi, a rural Kenyan farming cooperative has established a relationship through e-mail with the US-based EarthMarketplace to sell local produce directly to North American consumers. Bypassing distributors reduces the costs, increases local farmers' revenues and improves the choice for consumers. Similarly, a British supermarket is planning to use e-mail to conduct "just in time" purchase of chili peppers from a farm in Kenya.

Independent newspapers and magazines now are published daily on the Web in a growing number of other African countries, allowing users in remote areas to obtain the latest news and independent analysis without waiting days or weeks for local postal deliveries.

Education online

The prospects for delivering educational support through the use of the Internet in schools, to extension and technical training programmes, and even to individuals are beginning to show exciting possibilities. A number of large companies already have been attracted by the potential for using scheduled multimedia broadcasts via satellite to begin establishing the necessary infrastructure over Africa.

More than 6,000 correspondence course students all over Africa now can obtain advice and reading materials from their tutors at the University of South Africa (UNISA) via e-mail and the Web. UNISA also has tens of thousands of students in South Africa who make use of the service, called Students OnLine. The service provides for electronic registration, downloading of study materials, and posting of exam results (over 40,000 students picked up results this way after the last exam period). In addition, every time an assignment is submitted, the student can follow it through the entire process of evaluation and review.

In a few instances, the use of the Internet is already reducing the isolation of some marginalized groups. In Ghana, the lack of an efficient postal service has provided a market for Message Link, a network of e-mail hubs which print out messages received and then deliver them to their addressees by bicycle. In Kenya, women are building an electronic network, including a database of contacts and an online discussion area (http://www.africaonline.co.ke/AfricaOnline/women.html).

At the moment, many such activities in Africa take place in areas close to capital cities, because their concentration of economic and communications facilities has stimulated sufficient demand to make them more viable to operate. However, if awareness of the best models for success can be increased in rural areas and the costs shared among the broad range of providers and users, the wide variety of services that now can be delivered through a single telecommunications link will offer new possibilities to provide for local populations' information and communication needs.

In particular, there is growing interest in kiosks, "cybercafes" and other forms of public access, such as adding personal computers to community phone-shops, schools, police stations and clinics which can share the cost of equipment access among a larger number of users. External institutions such as the International Telecommunication Union and Canada's International Development Research Centre, along with local organizations such as the South African Universal Service Agency, are supporting applications from communities for such "telecentres."

Gains in business efficiency from going online

Although much attention has been focused on how the Internet may generate new business opportunities, companies in Africa are finding it is having a far greater impact on how their existing business is done. Using the Internet is cutting the cost of doing business, speeding up the business cycle, eliminating middlemen and expanding the range of potential customers.

For example, Tanzania Regent Clearing and Forwarding (TRCF), a small import-export company, now uses $0.10 e-mail messages and $1 e-mail fax gateways instead of $20 international faxes and telexes to place orders for products in North America and Europe. As a result, the company has seen its telecommunications bill fall from $500 to $45 per month. Meanwhile, stationery costs for fax and telex paper have been eliminated, along with time-wasting, expensive and error-prone typing of documents.

With cheap and almost immediate access to many of its suppliers, TRCF now is able to place a series of orders each day as they come in, instead of having to wait to consolidate orders in one fax or telex. Likewise, the company's clients, if they also have e-mail, can place orders more cheaply, at any time, from virtually anywhere, even if they are out of the country. They also need not worry about mistakes in the orders caused by retyping or fax errors. Using information on the World Wide Web, TRCF also has become a more effective promoter of its own services, through its increased ability to analyze trade statistics, identify new markets and carry out Internet-based promotions.

Aside from the clear importance of access to electronic mail for cementing personal relationships with clients, the Internet is expected to generally increase business for service companies like TRCF by providing a powerful new vehicle for linking suppliers directly with the final consumers of their products. With the potential to substantially improve efficiency by eliminating intermediaries, the Internet's further expansion can bring reduced costs that can then be passed on to the customer.

— M.J.

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