Edward Miguel’s examination of sub-Saharan Africa’s economic development focuses on outside influences and interventions as the major economic forces affecting the region. Foreign aid, foreign direct investment, the colonial legacy, and so on: each plays a significant role in explaining the current status of the continent. Indeed, Miguel’s focus may simply be a reflection of what has emerged over the past forty or fifty years as the prevailing view of the African majority. According to this understanding, many Africans have been passive victims, or beneficiaries, of outside initiatives, lacking the money, tools, and resources to release their own economic shackles. I am not sure that this story was ever true. In any case, the current picture is very different. Moreover, while Miguel provides an analysis of formal development in sub-Saharan Africa, he ignores the crucial factor of informal economic growth. African entrepreneurs are discovering that the current technological environment enables them to remove those shackles for themselves. They need not rely on a donor agency or international trade agreement to hand them the key.
I have spent the past five years or so helping grassroots nonprofits in developing countries take advantage of the latest technological revolution—the mobile phone. With penetration rates in excess of 30 percent and handset sales among the highest in the world, sub-Saharan Africa is poised to gain from the introduction of what is commonly referred to as a “leapfrogging technology”—a technology that allows developing countries to bypass inferior methods and industries in favor of more advanced ones. Farmers are now able to access market information through their phones, and better information leads to higher income. Casual laborers are better able to advertise their services and take on more jobs because they spend less time waiting on street corners for work to come their way. Unemployed youth can receive news of job openings on their phones, alerting them when work becomes available. Web-enabled mobile phones can also provide health information and advice and remind people when to take their medicine. A citizen with a mobile phone has the information he or she needs to engage more actively in civil society by monitoring elections and helping keep governments accountable. Mobile telephony and Internet also make possible early warnings of wildlife threats, mitigating human-elephant conflict that endangers lives and livelihoods. The impact and wide-ranging uses of mobile technology in the developing world are nothing short of staggering.
The opportunities brought by the arrival of mobile technologies and services have not gone unnoticed, particularly by those at, or uncomfortably close to, the so-called bottom of the pyramid. There, too, mobile ownership is increasing, and shared phone and village phone schemes mean that those who are not yet able to afford a phone of their own still have access to the technology. A single village phone lady—an individual who purchases a mobile phone and charges neighbors for its use—may provide telecommunications services to hundreds of people in her area.
Mobile phones have become vital to the sub-Saharan way of life. According to the Center for Policy and Development, a Nigerian NGO, many Nigerians describe losing them as literally a matter of life or death for their businesses. More widely, the spread of mobile phones has created significant casual (or informal) employment opportunities. For example, a recent report by the Uganda Communications Commission found that that country’s information communications technology sector, a majority of which is the mobile industry, officially employs roughly 6,000 people. The informal sector, which engages in support activities, represents over 350,000. The numbers are monumental. If we ignore this informal sector, a considerable amount of economic activity will be overlooked.
Anyone who has traveled to an African country in the past couple of years could not have failed to notice representatives or analogues of these 350,000 Ugandans: women selling airtime on the streets; children dodging cars at main junctions, selling chargers and phone covers; street vendors charging people’s phones for a fee; and mobile phone repair shops squeezing one last drop of life from old phones. There is also a thriving second-hand market, with stalls selling all manner of new and recycled handsets. Entrepreneurs are even building their own traveling mobile services, strapping phones and spare batteries to the fronts of bikes and seeking out business.
In a much-cited 2005 study, an economist at the London Business School concluded that an extra ten mobile phones per hundred people in a “typical developing country” leads to a 0.59 percent increase in GDP per capita. The insatiable demand for mobile technology generates significant tax revenue for the government, but much of the growth can be found in the increasingly efficient informal sector, out of sight of governments and economists. At the bottom of the pyramid, where micro-loans of just a few dollars are a proven catalyst in helping people work their own way out of poverty, the diffusion of mobile technology has the clear potential to do the same.
As more and more people become connected, future studies of sub-Saharan Africa and its economic potential will find it increasingly difficult to ignore the influence of mobile technology and the spirit of African entrepreneurs who capitalize on it. There is little doubt that this spirit has always been there, but perhaps it is the emergence of mobile technology that has enabled it to thrive. ©