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May 25 is a significant date for Africa. On that day in 1963 the continent and its people celebrate Africa Day, which commemorates the formation of the AU. It is a day when Africans celebrate the continent’s independence, freedom and liberation from colonialism.

Reflecting on the significance of Africa Day we have accomplished much in terms of colonial liberation, but plenty of work remains to achieve liberation from the persistent challenges of poverty, inequality and unemployment, which continue to plague the continent.

I am fortunate to work in the dynamic and vibrant technology space, supporting a range of businesses in various industries, including small and medium-sized enterprises (SMEs) across the continent. A common realisation in my travels and interactions with business leaders is the enormous opportunities Africa offers.

A youthful continent

According to the UN, Africa has a population of 1.1-billion, people, roughly equal to the combined populations of Europe and North America. The continent’s youthful population is expected to grow to 1.4-billion by 2030 and to 2.1-billion by 2050. About 70% of Africans are under the age of 30, while the population in Europe is ageing and declining. This young population offers enormous opportunities for economic growth and innovation, but only if the opportunity is seized.

Unlocking resources 

UN data indicates that Africa has 30% of the world’s mineral resources and 65% of the planet’s arable land. SA, for example, holds 90% of the world’s platinum reserves, while Nigeria and Libya are among the top 10 in terms of  oil reserves.

Africa also has the most cobalt reserves, with the Democratic Republic of the Congo accounting for more than two thirds of global supply. The mineral has become a strategic resource as the world switches to green energy, particularly in the automotive and power-generation industries.

Mobile innovation

According to a Boston Consulting Group study of mobile payment banking, Kenya and Ghana have the second- and third-highest mobile payment usage after China, demonstrating Africa’s enormous potential. Mobile transactions account for 87% of Kenya’s GDP and 82% in Ghana.

To put this in context, the African mobile payment market could have 850-million customers by 2025, 100-million more than Europe’s total population. The big question is why, despite a huge, young population and mineral resource wealth, Africa continues to trail the rest of the world in its development?

Tech-enabled SMEs hold the key

One of the solutions to driving Africa’s economic development could lie in the small and medium enterprise (SME) sector, but SMEs have to adopt and leverage technology.

African businesses, and SMEs in particular, face significant challenges, including a lack of access to capital, specialised skills, raw materials and markets. A failure to to adopt new technologies is causing several issues for Africa’s SME sector, ranging from poor planning to a lack of forecasting capability and a lack of capacity to leverage the efficiency gains of artificial intelligence and machine learning. These issues must be overcome to unleash the next generation of African business success stories.

Though technology isn’t the only means of building world-class competitive African businesses, it is one of the most accessible. Returning to the mobile payment banking example, this innovation was the result of a savvy use of technology to address a fundamental challenge in Kenya and Ghana: a lack of banking infrastructure.

Digital supply chains and business network solutions could unlock access to new markets for raw materials or finished products. Innovative use of technology — as we have seen with mobile banking — could solve the immediate challenges that are stunting SMEs’ growth and unlock a new wave of innovation across the continent.

Even though Africa continues to face numerous and complex challenges, there is no denying that it brimming with possibilities. The time for African businesses to leverage technology as a strategic resource to fuel innovation and growth is now.

• Moyo is marketing director at SAP Africa.

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