GITEX AFRICA: Opportunities & Challenges For Africa Start-Ups
GITEX AFRICA 2023 scheduled for 31 May to 2 June in Marrakech, Morocco, is expected to attract industry leaders and decision-makers, covering topics on emerging technologies such as fintech, e-commerce, IoT, telecom, and cybersecurity across Africa. However, amidst global economic uncertainties resulting in layoffs, declining venture capitalist funds, and increased cybersecurity attacks, there are both opportunities and challenges for Africa’s tech industry this year.
The event looks at start-ups from a dual angle, channelling both opportunities and challenges for the younglings.
Regulatory advancements: While Africa’s tech start-up ecosystem is expanding rapidly, it lags behind in a supportive regulatory environment. Countries like Tunisia, Senegal, Nigeria, and Congo have active start-up laws, while Rwanda, Ghana, Kenya, Ethiopia, and Uganda are developing regulatory frameworks to spur innovation and ensure compliance, consumer protection, and fair competition.
Expanding digital economy: Africa’s digital economy is experiencing significant growth, driven by increased internet connectivity and a rapidly growing youth population. A report predicts that Africa’s digital economy will rise from $115 billion to $712 billion by 2050. African governments have opportunities to enhance access to digital technologies, platforms, and services, further scaling the technology and innovation ecosystem.
Tech talent shortages: Despite Africa’s young and dynamic population, there is a shortage of skilled professionals in the technology sector. The demand for tech skills exceeds the available talent pool, resulting in challenges with recruitment, retention, and upskilling. Factors such as brain drain, insufficient STEM education, and technical skill gaps contribute to this shortage.
Decline in funding: Venture capital funding is crucial for start-ups to develop, launch products/services, build teams, and scale operations. However, African start-ups may face a decline in VC funding due to global economic events. Reports indicate a 57.2 per cent decline in funding raised by African start-ups in the first quarter of 2023 compared to the same period in 2022, attributed to economic recession, investor caution, and limited viable business models.
Cyber-attacks: Start-ups are vulnerable to cyber-attacks due to limited resources, lack of expertise, and rapid growth. Budget constraints often lead to insufficient cybersecurity measures, leaving start-ups as attractive targets. Inadequate awareness, rapid growth outpacing security measures, valuable intellectual property, third-party dependencies, and a lack of security culture contribute to the risks.
Regulatory challenges: African start-ups face complex and inconsistent regulations, lengthy bureaucratic processes, limited supportive policies, and inadequate intellectual property protection. These regulatory challenges pose obstacles to innovation within the continent.
GITEX AFRICA presents a pivotal moment for Africa’s tech industry. Regulatory advancements and an expanding digital economy offer great potential for innovation and growth. That being said, by addressing these challenges head-on and leveraging the opportunities at hand, Africa’s tech ecosystem can foster a thriving environment for start-ups, drive economic development, and position the continent as a global tech hub. GITEX AFRICA, therefore, serves as a crucial platform to discuss and strategise solutions that will shape the future of Africa’s tech industry.
Would you love to get more insights on African start-ups, and meet VCs and investors? Then be sure to register here and get a CIO Africa discount to attend GITEX AFRICA 2023.