Mobile network investment as a driver of economic development
Society types, international development experts and diplomats are always quick to point out how mobile technology has revolutionized global development.
Around the world, from South Africa to Singapore, mobile phones are being used to transmit public health information, track weather patterns, look up market prices and, in many nations, as the primary means of banking.
Development groups and charities deserve a hearty congratulations for their efforts to help spur first-generation markets for mobiles throughout the developing world.
Now, however, it’s time for them to bow out and bring in the lawyers, lobbyists, and captains of industry.
Development experts and aid workers are good people, but their jobs are to help people in the worst places in the world pull themselves up by their bootstraps.
Once that is done, however, they have a tendency to linger in sectors that no longer need their help. The mobile market is one of those sectors, although public health charities and agricultural assistance programs should continue to make use of the mobile network they’ve built up.
What is needed now are more deregulated markets with more enforceable regulations.
Governments throughout Sub-Saharan Africa and Asia, through a combination of populist pandering and lack of understanding of actual economic issues, have a strong tendency to burden entrepreneurs with meaningless red tape while undercutting the market with subsidies and state-owned industries operating at a loss.
Although it’s hard to get anyone to admit it on record, it is a well-known fact that a dense tangle of overlapping regulations is an easy way for poorly paid government workers to collect graft.
In the mobile market, that means cellphones are run by pay-as-you-go networks, and often bought out of the back of trucks where reliability and customer satisfaction is surprisingly high.
Africans often have to have two cellphones: one a pay-as-you-go mobile network, and one on a pay-as-you-go or frequently pirated Internet plan. Most transactions are done in cash and the cellphone providers collect revenue, but with better regulation and at least a modicum of government support they could be rolling in it.
That’s the issue development types aren’t keen to discuss. Once an economy has reached a point of steady expansion, it’s a ripe market for investment.
Of course, foreign investment in Sub-Saharan Africa in any sector is lacking due in no small part to the continent’s reputation as unstable. In addition, the previous cannibalistic attitude corporations and local governments held toward each other from the 1960s to the 1980s – corporations were stripping the land bare and paying the locals pauper’s wages and sponsoring coups, while governments were nationalizing and freezing assets left and right – plays a part as well.
Although that was a nasty bit of history, that’s just what it is –history. It is time for America’s telecom giants to heed the call of the dollar and begin massive investments in any African state that will have them and to reap the rewards therein.
In this day and age, the truth is that Africa’s leaders are a new generation eager to build economic growth. Sure there are still the kleptocrats like Goodluck Jonathan in Nigeria, and the tin despots like Mugabe in Zimbabwe.
But there is also Ellen Johnson Sirleaf of Liberia, who is trying to rebuild a nation from the ground up, and an entire crop of new leaders raised in independent nations ready to help see their homelands as something more than an object of Western pity and derision.
Wireless technology has helped pull the potential behemoth that is the African economy from its slumber. Now is the time to invest before it fully awakens.
For those who doubt that Africa’s economy has the potential to take off, look at what Asia’s economic juggernauts China, Korea and Taiwan looked like 40 years ago. Then think about where the emerging economies of today will be in the next 20 years. Now is the time to invest in tomorrow.
