Archives for posts with tag: Afro-optimism

It looks like environmental scientists are not jumping into the Afro-optimist bandwagon. Marchiori, Maystadt, and Schumacher (2012) predict that climate change will force migratory flows from the coastal areas to the mainland in Africa, and East Africa will be particularly affected  (click on the image to enlarge).

Marchiori, Maystadt, and Schumacher (2012)

Marchiori, Maystadt, and Schumacher (2012)

Such a mapping gives an idea of the potential centripetal process induced by environmental migration. While there has been a long tradition of migration to the coastal agglomerations in Africa (Adepoju 2006), coastal areas could experience a significant proportion of their population fleeing toward African mainland due to climate change by 2099. In West Africa, Benin, Ghana, Guinea, Guinea-Bissau, Nigeria and Sierra Leone may be among the most affected countries. In Eastern Africa, Kenya, Madagascar, Mozambique, Tanzania and Uganda may constitute a cluster of sending countries of environmental migrants. In Southern Africa, Angola and Botswana could become important sources of environmental migrants while Congo and Gabon could also be pointed out in Central Africa. Without jumping too quickly to predictive conclusions, such a centripetal pattern of flows could warn about some potential destabilizing effects. On the one hand, massive population movements could speed up the transmission of epidemic diseases such as e.g. malaria (Montalvo and ReynalQuerol, 2007) in areas where the population has not yet developed protective genetic modifications (Boko et al., 2007). On the other hand, the expected move towards mainland Africa where population density has been recognized as a factor enhancing conflict could become a major geopolitical concern; for instance, North-Kivu in Congo, Burundi (Bundervoet, 2009), Rwanda (Andre and Platteau, 1998), and Darfur (Fadul, 2006).

More here (pdf)

The “Africa rising” narrative in Kenya is always linked to the ICT sector, in particular mobile technologies, mobile apps, and internet-based applications. I wonder what will happen to this optimism after learning that Mocality, one of the big investors in this field, decided to shut down:

“Mocality has achieved some incredible things over the last four years, and has touched the lives of many people in Africa, but alas, all good things must come to an end.”

Few ICT enthusiasts in Kenya saw this announcement coming. Mocality, the online business directory owned by Naspers, a South Africa-based media company, will close down operations in Kenya and Nigeria on February 28th. In 4 years Mocality managed to register over 100.000 businesses in Kenya. The plan was to expand throughout Africa and create the largest business directory in the continent –none of this will happen.

Is this a hit to ICT-led afro-optimism?

To some extent, I believe it is. Or at least, it has brought some realism back to the discussion on ICT in Africa. In this blog I always argued that the expansion of the ICT sector is a great opportunity, but it has to go hand by hand with expansion in the industrial sector, manufacturing in particular, or it’ll be a hype, or even a bubble, with little effects on job creation and sustained economic growth. But if you look at the media coverage on the topic, hype has been all over the place. Look at Wired UK a year ago:

Want to become an internet billionaire? Move to Africa”:

If you want to become extremely wealthy over the next five years, and you have a basic grasp of technology, here’s a no-brainer: move to Africa.

Wired is not the Journal of Development Economics, and the exaggeration is probably intentional (I hope so anyway), but it signals the hype surrounding the ICT sector in the continent.

Perhaps Mocality made its move in the Kenyan market a little too early. Perhaps the problem is much deeper and the Kenyan market is simply not ripe for this kind of business. Mocality did not explain the reasons behind their decisions to close down, but rumors are that  the operating costs were too high and the returns on the investment were not satisfactory. We can’t forget that the Kenyan economy is still largely informal and being online or not doesn’t make much of a difference for most enterprises.

But Kenya is also a fast-growing and fast-evolving economy, and the optimists among us might argue that Mocality is leaving the market just a little too early. Mocality CEO Neil Schwartzman had a very different opinion, however, stating that:

“reaching profitability was not a reasonable near-term prospect.”

Ouch