Top 4 Countries Leading the Way in Africa’s AI Revolution
Business and advices
As the world progresses toward the age of artificial intelligence, Africa is not left out of this technological revolution.
In recent years, the continent has experienced a surge in investment in tech, particularly in the field of AI.
However, according to a report by the African Development Bank, just four countries are leading the way, accounting for 92% of Africa's investment in tech.
These countries include: Nigeria, Egypt, Kenya, and South Africa.
In this article, we will take a closer look at these four countries and examine WHY they are leading the way in Africa's AI revolution.
Furthermore, we will explore what other countries can do to catch up with Africa’s “Big Four”.
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Why the “Big Four” Are Leading The Way in Africa’s AI Revolution
1. Large economies and sizeable populations
The African continent is experiencing an AI revolution, and the big four countries of Nigeria, Egypt, Kenya, and South Africa are at the forefront of this transformation.
According to the AfDB, these countries are pulling ahead faster than other African countries when it comes to start-up investment and funding, primarily due to their large economies and sizable populations.
With a projected population of 206 million by 2050 and a GDP of approximately $440 billion, Nigeria is an attractive location for start-up investment inflows.
Similarly, Egypt, Kenya, and South Africa have some of the largest economies in Africa, with GDPs of $404 billion, $110 billion, and $420 billion, respectively.
However, as the report notes, population and GDP alone are not enough to attract investment to start-ups.
While countries like Tanzania and Ethiopia have sizable populations of 59 and 115 million, respectively, they are yet to secure anywhere near the level of venture investments that the big four regularly pull in.
The same applies to island states like Mauritius and the Seychelles, which have higher per capita incomes and favorable regulatory environments for start-ups but are yet to increase their venture investments.
2. Government Support
Another key factor contributing to the dominance of the "big four" countries in Africa's AI revolution is their government support for AI.
Egypt, for instance, has established a National Council for Artificial Intelligence and an African Working Group on AI, which aims to develop a unified AI strategy for Africa.
Kenya, on the other hand, was the second country in Africa to publish a National AI strategy in 2019. This strategy, entitled "Emerging Digital Technologies for Kenya," considered Blockchain and AI as key enabling technologies.
Furthermore, the Kenyan government's Big 4 Agenda, which centers on using 4IR technologies to eliminate corruption, streamline democracy, facilitate financial inclusion, and improve service delivery, serves as a useful benchmark for other emerging economies.
South Africa, the leader in the region, has one of the most developed tech economies and tertiary education systems, and work is ongoing towards the creation of a National Strategy on AI via the submission of findings from the Presidential Commission for the 4IR made in January 2020.
Nigeria, despite having no standalone national AI strategy, identified AI as a key pillar in its National Digital Economy Policy and Strategy (2020-2030) and created The National Centre for Artificial Intelligence and Robotics (NCAIR).
Nigeria is also home to Data Science Nigeria, the most successful African NGO program focused on promoting AI/Data Science and grassroots education in Africa.
Note: Mauritius is the first country in Africa to publish a National AI Strategy, has an attractive tech and investment ecosystem, and deserves special mention.
With government support as a driving force, these countries are leading the way in Africa's AI revolution, paving the way for the rest of the continent to follow suit.
3. High Levels of FDI (Foreign Direct Investment)
Another crucial factor that has contributed to the big four's leadership in Africa's AI revolution is its high level of foreign direct investment (FDI).
With 80% of FDI flowing into Africa going to these four countries, they have been able to access significant investments, which have helped them to further expand their dominance of Africa's tech scene.
This influx of cash has enabled these countries to fund AI research, establish tech startups, and attract top AI talent, all of which have been instrumental in driving the growth of AI in Africa.
Additionally, the high level of FDI has led to the development of robust tech ecosystems in these countries, with many of them hosting world-class incubators, accelerators, and venture capital firms that continue to attract further investments in AI.
As such, the big four's leadership in Africa's AI revolution is not only a result of their government support but also their ability to attract significant investments, which has further propelled their growth in this field.
How can the Rest Catch up with Africa’s “Big Four”?
While the "big four" countries in Africa lead the way in the AI revolution, other African nations can catch up by following their lead.
African Governments should improve their legal and institutional environment to create a hospitable investment ecosystem for investors and start-ups.
The African Continental Free Trade Area (AfCFTA) can also be used as a tool to win investments by reducing investment barriers and improving investment governance within countries.
The success of Nigeria, Egypt, Kenya and South Africa is not only something to be proud of, but also evidence that innovation can flourish anywhere with the right conditions.
African countries are home to a young, ambitious, and smart population. By introducing the right tools and regulations, other African countries can create a conducive environment for the continent's tech scene to flourish.
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