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Mobile services add $140b to SSA economies

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By Abdulwasiu Usman

In 2021, mobile services generated about 8% GDP in Nigeria and other SSA.

Mobile technologies and services have become a transformational force with a more significant impact in Sub-Saharan African countries. It generated around 8 percent of the Gross Domestic Product (GDP) in Nigeria and other sub-Saharan Africa (SSA) countries in 2021, a contribution totaling roughly $140 billion of economic value added in the year. The mobile ecosystem also supported more than 3.2 million jobs (directly and indirectly) and made a substantial contribution to the funding of the public sector, with $16 billion raised through taxes on the sector.

This was disclosed in the Global System for Mobile Telecommunications Association’s (GSMA) Mobile Economy Sub-Saharan Africa report 2022, released over the weekend. According to the report, by 2025, mobile services contribution would increase by $65 billion, as countries in the region benefit from productivity and efficiency improvements driven by the increasing mobile service adoption. GSMA also reported that at the end of 2021, 515 million people in SSA had subscribed to mobile services, accounting for 46% of the population, an increase of about 20 million people from the previous year.

Young subscribers are more interested in 4G and 5G connectivity.

Additionally, it stated that approximately 100 million new subscribers will enroll by 2025, bringing the total number of users to 613 million, 50% of the region’s population. According to the telecoms institution, the two most populous countries, Nigeria and Ethiopia, will account for nearly a third of new subscribers between now and 2025. With a substantial share of the population under 18, SSA’s demographics indicate that subscriber growth will stay high for the foreseeable future as young consumers reach adulthood and will be able to subscribe to mobile services.

GSMA asserts that young subscribers are more likely to be tech-savvy and interested in upgrading to faster mobile Internet speeds, such as 4G and 5G. This is one trend to watch, given the development and dissemination of digital services in the area have significant ramifications for the region’s progress toward ubiquitous 5G networks. These include 5G spectrum auctions, 5G pilots and commercial trials, and efforts to develop locally relevant 5G use cases. For instance, South Africa’s ICASA concluded the 700, 800, 2600, and 3500 MHz spectrum auction in May 2022; MTN Nigeria began a commercial 5G prototype in August 2022, and Vodacom launched a commercial 5G network in September 2022.

4G connection is projected to rise by 2025 as 3G uptakes drop.

Following the massive demand for connection caused by the COVID-19 pandemic, the GSMA saw an increase in interest in the role of 5G in the connectivity landscape. It emphasized that while the general consensus is that widespread 5G implementation in SSA is a long-term possibility, there is a compelling argument to utilize the technology in certain circumstances to meet specific connectivity needs for people and businesses. GSMA continues that, although 3G will continue to be the leading connectivity technology in SSA, accounting for over half of total connections by 2025, this year represents a watershed moment as 3G penetration starts to drop for the first time.

This underscores the growing movement to 4G as operators strive to transition consumers from outdated networks (2G and 3G). By 2025, 4G will account for one-third of mobile connections in the region, up from less than a fifth in 2021. According to the GSMA, policymakers can help propel inclusive development on all fronts, citing mobile connectivity’s potential to accelerate SSA’s digital transformation and drive socioeconomic advancement in healthcare, education, digital commerce, industrial automation, and smart city infrastructure. Harnessing this potential requires legislative actions to encourage network investments and increase consumer affordability of digital services.

Demand for 5G-enabled devices increases in the region.

GSMA claims that 5G adoption in SSA will be largely dependent on the accessibility and affordability of 5G devices, given that the slow uptake of 4G in the area is partly due to the high cost of devices compared to average income. In addition, it was disclosed that Smartphone shipment data for the region show rising demand for 5G devices. In the second quarter of 2022, 5G-enabled device shipments climbed by 26.9%, exceeding smartphone sales in the region. A youthful, tech-savvy populace with a demand for the newest technology and increased rivalry among mobile phone makers are driving the expansion.


Related Link

GSMA: Website


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jdpumping
jdpumping
1 year ago

Mobile services has really boost our economy because our GDP has skyrocket and with Advent of more developed networks 4G and 5G much more will be realised and improve our economy.

Christiana
Christiana
1 year ago

Sub-Saharan African countries have grown particularly receptive to the transformative power of mobile technologies and services.

Tolaniiii
Tolaniiii
1 year ago

As countries in the area benefit from increased mobile service usage, mobile services’ contribution will rise by $65 billion.

Abusi
Abusi
1 year ago

This shows Nigeria is generating a lot of revenue from the mobile services. More enabling environment should thus be provided for them, it will in turn help them maximize their services.

Ultra0711
Ultra0711
1 year ago

Mobile services has really render a huge contribution to our GDP. With the advent of 5G connectivity am sure if well harnessed, the contributions will amplified well and continues to increase in the coming years.

Haykaylyon26
Haykaylyon26
1 year ago

Wow a huge amount of revenue is been generated from mobile service it should continue to be taken care so we can be generating from it and also find a way to make the revenue increase so it can help our country

Adeolastan
Adeolastan
1 year ago

Mobile services has been generating billions of naira to Nigeria economy since it inception through direct labour or through partnerships from to their contractors handling the services which they render.

DimOla
DimOla
1 year ago

It is most probable that both 3G and 4G will drop drastically within the most shortest possible time earlier than what was predicted in the above writeup due to rapid advancement in science and technology and quick adaptation to new devices especially by the youth.

SarahDiv
SarahDiv
1 year ago

With the advancement in science and technology moreso that we have entered into Artificial intelligence (AI) era, there will be massive adoption of devices that is 5G driving in other words the use of 3G and 4G devices will begin to reduce in most SSA countries faster than expected. GMS has greatly benefited our country economically and easing accessibility to digital world.

Godsewill Ifeanyi
Godsewill Ifeanyi
1 year ago

In countries located in sub-Saharan Africa, mobile technologies and services have evolved into a transformative force that is having an increasingly major impact and that is very good

Last edited 1 year ago by Godsewill Ifeanyi
Adesanyaj72
Adesanyaj72
1 year ago

It is encouraging that the rate of subscriber growth will remain high for the foreseeable future since young customers will soon be allowed to subscribe to mobile services once they reach the age of majority.

Chibuzor
Chibuzor
1 year ago

After the widespread need for connectivity brought on by the COVID-19 epidemic, the GSMA noticed an increase in interest in the role that 5G would play in the future of the connectivity landscape, which is a positive development.

Hassan Isa
Hassan Isa
1 year ago

The year 2018 marks a turning point as 3G penetration begins to fall for the first time in SSA, even though it will remain the primary connectivity technology, accounting for over half of total connections by 2025.

Nwachukwu Kingsley
Nwachukwu Kingsley
1 year ago

Legislative initiatives are required to incentivize investments in networks and to raise the cost of digital services for consumers in order to fully capitalize on this potential.

Kazeem1
Kazeem1
1 year ago

. The expansion is being driven by a population that is young, tech-savvy, and has a thirst for the newest technology, as well as greater competition among mobile phone manufacturers.

Taiwoo
Taiwoo
1 year ago

Since the beginning of its existence, mobile services have contributed billions of naira to the economy of Nigeria. This has been accomplished either by direct labor or through partnerships with the contractors who handle the services that they supply.

Tonerol10
Tonerol10
1 year ago

Mobile services has boost the country economy. We need to grow more on our mobile technologies and services for better impact in Sub-Saharan African countries.

Iyanu12345ogg
Iyanu12345ogg
1 year ago

More enabling environment should be provided for them, it will in turn help them maximize their services.

theApr
theApr
1 year ago

The GSMA asserts that policymakers can aid in advancing inclusive development across all domains, pointing to mobile connectivity’s ability to quicken SSA’s digital transformation and fuel socioeconomic advancement in healthcare, education, digital commerce, and other areas.

Remi1
Remi1
1 year ago

To fully realize this potential, favourable policies are needed to encourage network investment and to increase the cost of digital services for consumers. And boost their economic contribution