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Are tech companies Africa’s new colonialists? Press "Enter" to skip to content

Are tech companies Africa’s new colonialists?

In 1886, barely a year after Europe’s great powers met in Berlin to carve up the continent of Africa, Queen Victoria granted Sir George Goldie a charter for his Royal Niger Company. The charter gave Goldie, a moustachioed, waistcoated gentleman of Scottish descent, the right to administer the Niger Delta and its hinterland. Like most of his peers, he was motivated by extraction, which in those days meant kola nuts, peanuts and palm oil.

There were many variations across sub-Saharan Africa, but the pattern of exploitation was basically the same. Europeans arrived with power and technology, and left with goods and profits. First, they took slaves — the original sin — before turning their attention to commodities including gold, cocoa, rubber and coffee. Chartered companies would in due course give way to formal empire and Goldie’s was no exception, transferring its rights to the British government in 1900.

Much has changed in Nigeria since independence in 1960. But here, as elsewhere in Africa, the economic template established by the Europeans has proved difficult to shift. Trade continues to be conducted through political elites with access to resources. Most value is added to commodities after they leave the continent. The perennial puzzle of African development in the postcolonial era has been how to break the mould — how to extract Africa from its history of extraction.

For some, the great leveller of new technology offers a solution. The technological revolution sweeping the world is beginning to have a profound impact on the continent. Many have put their faith in “leapfrogging”, the idea that Africa can escape its poverty and colonial heritage by skipping whole stages of development. The biggest example of that has been Africa’s jump straight to mobile phones, almost entirely bypassing fixed-line technology.

Behind such hopes, however, lies a familiar anxiety over ownership and control. What if Big Tech, far from being a liberating force, turned out instead to be a new kind of colonialist? On April 12 this year, Juliet Anammah, chief executive of the Nigerian operations of a company called Jumia, stepped forward to ring the opening bell of the New York Stock Exchange.

Anammah was one of several senior executives there to celebrate the initial public offering of an e-commerce company that had been dubbed the “Amazon of Africa”. Jumia, which operates in 14 African countries from Nigeria to Egypt and from Ivory Coast to Kenya, this year became the first entirely Africa-focused e-commerce company to be listed on the prestigious US stock exchange.

There is, however, one problem with the Jumia story. No sooner did the company complete its New York listing than a backlash began. Jumia, say its detractors, is not an African company at all. Jumia does fit squarely into the narrative of a technological solution to Africa’s problems and a path towards a future in which commerce, not extraction, becomes a motor of African growth.

With a combination of online technology and strategic offline infrastructure — including warehouses and fleets of motorbikes — Jumia promises an expanding African consumer class the opportunity to have goods delivered directly to their homes. Customers are able to order anything from an iPhone or an LED television to a chicken korma at the touch of a screen, bypassing the potholed roads and exhaust-filled traffic jams that characterise many fast-growing African cities. Interest in Jumia’s initial public offering had been intense.

Not long after the ceremonial bell ringing, the company’s stock began to surge from its initial price of $14.50. By the end of the day, it was up 75 per cent, valuing the company within a whisker of $2bn and making small fortunes for its founders. In the following few days, the share price continued surging to break through $40. Though that was still tiny by the standards of Silicon Valley, to the Afro-optimists, particularly ones with a technological bent, Jumia’s listing was a hugely significant event. It showed the world that African tech had come of age and that investors could make money out of a company with big African expansion plans.

Surely now more investment would follow, argued Jumia’s advocates, helping African businesses and African economies to chart a new future. The row over the origins of Jumia is part of a larger debate about race and appropriation Jumia’s listing had shone a light on what close watchers of Africa had long known: that the continent was buzzing with tech ideas. After the leap to mobile, the story began in earnest a little over a decade ago in Kenya, with the invention of M-Pesa, a system for transferring small amounts of money by mobile phone. As easily as sending a text message, people could transfer money home to relatives in their village or pay for goods or utilities.

M-Pesa and dozens of variants like it are now used by hundreds of millions of Africans, many of them otherwise excluded from the formal banking system. Even the poorest can build up a credit history and take out microloans. In the Kenyan capital Nairobi, the ecosystem has given rise to a vibrant tech hub known, almost inevitably, as “Silicon Savannah”. Hundreds of companies have built on the spine of the money transfer network to offer services such as the renting of solar panels, where customers make micropayments by phone.

Online pharmacies have been launched, enabling customers to screen for fakes and cut out gouging middlemen. Not to be outdone, Lagos, Nigeria’s commercial capital, has its own tech hub in the district of Yaba, known to some as “Yabacon Valley”. Even neighbouring Cameroon, with its far smaller economy, has not one but two tech hubs: “Silicon River” and “Silicon Mountain”. Across the continent, an explosion in the use of mobile phones — and the increasing penetration of smartphones — has opened the possibility of app-based services that can, at least theoretically, address problems from poor education standards and low farming yields to dire infrastructure and even corrupt tendering processes.

Health apps in Rwanda offer the poorest citizens the prospect of cheap medical consultations driven by AI. One online company in Nigeria, known as Cars45, seeks to address the problems of theft and fraud that plague Africa’s huge second-hand car market by offering a real-time online auction. Other companies, including Bridge, backed by Bill Gates and Mark Zuckerberg, hold out the possibility — still controversial to many — of tech-based solutions to poor-quality education in which a standardised curriculum is relayed to tablet-wielding teachers.

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©THE NATIONAL TIMES NEWS (2018)