Many nations that had previously struggled to establish robust economies are beginning to. In particular, regions in Africa, India, and South America are all beginning to become economic powerhouses.
Many nations that had previously struggled to establish robust economies are beginning to. In particular, regions in Africa, India, and South America are all beginning to become economic powerhouses. With increasing accessibility to cutting edge technologies fuelling this drive, as well as the backing of major international companies and institutions, these areas of the world are undergoing a radical transformation, one of which is Kenya.
Modern capitalist theory suggests that in order for the economy of any given nation to flourish, there are approximately eight conditions that need to be met for economic prosperity to be achieved. Namely, lack of institutional corruption; law and order; less red tape around taxation and employment; reliable contracts; high-end telecommunications and infrastructure; fair, transparent and openly competitive markets; as well as a relatively low corporation tax.
Now, not every nation in the world has managed to harmoniously bring all of these elements together, in fact, it is unlikely that any one single country has managed to strike the perfect balance, but there are indeed nations who have been thriving and those that have been surviving. This paradigm is beginning to balance out somewhat, and nations that had previously struggled to bolster their economy are beginning to do so with thanks to technologies that meet at least some of the requirements to make a nation ‘rich’.
Though simply putting these ingredients into a bowl and expecting the outcome to be the same in every region would be naïve. Culture, governments and environmental conditions also play a gigantic role in what a country can achieve in terms of economic growth.
Regardless of this, some are embracing fourth industrial revolution (4IR) technologies faster than others, with Africa being a current hotspot for growth, let’s take a look at one of the region's fastest-growing economies, Kenya.
Laying the Foundations.
In 2019, Kenya regained its position as the largest economy in Central and Eastern Africa, overtaking its northern neighbor Ethiopia, who is developing at breakneck speeds.
Reportedly, Kenya has managed to sustain decent economic growth over the past decade, rising from $52 billion in 2010 to $154 billion in 2019. As a result, the International Monetary Fund (IMF) reclassified Kenya as a “lower-middle-income” country, which is a significant achievement.
Kenya has put significant funding into developing large-scale infrastructure, including ambitious projects such as the Lamu Port-South Sudan-Ethiopia Transport (LAPSSET) Corridor. The Lamu port, thousands of miles of new roads, railway lines and crude oil pipelines make up part of the infrastructure upgrades which also extends to new airports, resort cities, hydro-electricity, fiber optics and communications, etc.
These are, supposedly, the foundations conducive to economic success and preparing the nation for digital transformation; seemingly this created a fertile ecosystem in which disruptive technologies and innovations can begin to thrive. Though despite these progressions, there are still some hurdles to overcome.
As noted in Kenya’s “Digital Economy Blueprint” report:
“For Kenya, a Digital Economy will, therefore, be premised on the ubiquitous provision of universal broadband access that will drive digitally enabled services for a digital people and economy.”
But Kenya is already attempting to address the matter, leveraging the Google Loon. Here, Kenya is using a number of these drones/balloons that enable broader 4G coverage, especially in rural unconnected regions of the country.
This became official in late March 2020, to which President Uhuru Kenyatta commented:
“Once inaugurated, this service will extend Telkom Kenya’s 4G network to areas that are not covered by any of our mobile network providers. Therefore, all Kenyans, wherever they are in the country, will enjoy access to high speed and affordable internet services.”
Tech in Action.
Perhaps one of the most fundamental sectors in the world, and especially Kenya, is agriculture. The Food and Agriculture Organization (FAO) reported in 2018 that agriculture represents approximately 26% of the nation's GDP, accounting for more than 65% of the nation’s exports and employs almost half of the total population.
Presently, AgriTech startups such as Shamba Records are using blockchain, artificial intelligence (AI) and big data to improve farming processes. With over 6,000 farmers on their books, the Shamba Records platform offers users the means to collect and map data, aggregate payments, leverage smart contracts as well as providing them with payment processing capabilities and access to credit.
At a utility level, one startup, M-Paya, has been seeking to address the woes surrounding electricity bill payments in Kenya. According to reports, electricity bills aren’t part of a simplified process as some properties/estates don’t have individual electricity meters, therefore no one knows who used the most amount of power and how much they need to contribute, leading to arrears and debts.
With their software, they have managed to create and install thousands of M-Paya meters, placing the responsibility of power usage/payment on the individual, and allowing landlords to measure and track electricity usage. Reportedly, the company is now preparing to jump into the Internet of Things (IoT) and big data to bring even broader benefits which could create deeper analytics, providing users and energy providers greater insight into usage patterns, boosting efficiency and lowering carbon emissions.
At an environmental level, one of the most fascinating stories in the region comes from Kenya Flying Labs (KFL), an arm of global robotics firm Flying Labs. According to their Q2 newsletter, KFL recently collaborated with the Kenya Forest Service (KFS) and Kenya Wildlife Service (KWS) to introduce drones that will monitor the health of forests. It is expected that the data, delivered in real-time, will reduce negative impacts caused by illegal loggers, forest fires, wildlife poaching and expose other critical areas that need to be addressed.
For the Future.
Kenya, amongst many other emerging nations, is part of a growing swathe of regions preparing for a future where digitization, automation, and mechanization are to become absolute staples of society and growth.
Kenya is a prime example because it has historically had a strong track record when it comes to the adoption of new technologies and ICT innovations.
Though, as noted, until recently they barely had the appropriate infrastructure to support these burgeoning dreams, which are now becoming an absolute reality.
Emerging economies are likely to be early adopters of 4IR technologies, as long as they can lay the appropriate foundations, making them exciting regions to watch evolve over the coming years.