African cities show strong potential for the coming years if they take the opportunity to adopt the ‘smart city’ approach to development.

Africa Ready to Leapfrog the Competition through Smart Cities?

African cities could deliver serious competition to mature cities such as London and New York in the coming years through the successful adoption of smart technology, suggests a new study carried out by consultancy firm Deloitte. Major multinational information technology companies have been predicting for some time now that Africa will be ‘the next big market’ due to the emergence of a number of rapidly growing economies on the continent. Now Deloitte’s report argues that the way forward for Africa is to develop ‘smart cities’. For this to happen however, African cities – whose populations continue to swell through migration – will need to face up to the particular challenges stemming from years of neglect of their infrastructure, make a step-change and commit determinedly to the path of innovation.

Structural advantages, long-term potential

According to the Deloitte consultants, African cities could see exponential growth that will enable them to leapfrog the competition from established western cities by around 2025 if they successfully adopt the functional, economic and social features of the ‘smart city’. However, this urban transformation implies leveraging cutting-edge technology and taking on board lessons learned from mature western cities. The authors point out that “the ultimate goal of a Smart City is transformational: to achieve enhanced quality of life for citizens and deliver tangible benefits at national, provincial and municipal levels while leveraging our natural resources judiciously.” African cities are advantageously positioned to start adopting smarter information and communication technologies because, unlike the mature cities of the world, they will not need to follow the upgrade path from analogue to ADSL but have the opportunity to start from scratch with the latest technology and move forward with rollout of the latest 5G/LTE networks. This will enable local businesses to leverage powerful communication infrastructures in a relatively short time.

High human potential

The report underlines that African consumers want the same things as other consumers all over the world: choice of food and housing, entertainment and interconnectivity, and the chance to adopt the latest fashion trends. In short, Africa is now seeing the ise ofr a middle class and, argues African Development Bank Chief Economist Mthuli Ncube: “it’s the middle class that drive demand in an economy.” Moreover, given an ageing European population, an increasing number of international brands will be looking to an African market full of young consumers. Some 62% of the continent’s population is today under 25 years of age, which is likely to be a decisive factor in Africa’s economic takeoff. Moreover, the Deloitte researchers point to the mindset of these young Africans, who “operate within an environment where anything and everything is possible,” an attitude which tends to stimulate entrepreneurship and the spirit of innovation. Meanwhile Africa is already posting the fastest mobile subscriber growth in the world. Average mobile subscription in African countries stands at 72% and is expected to reach 97% by 2017. The mobile surge is a key factor in the growth of economic activity, and thus of GDP, argue the Deloitte experts.