Siemens, in conjunction with Frost & Sullivan, has put together a comprehensive research project outlining the current state of key industries across the continent and identifying challenges and opportunities.
The study, named The dawn of digitalisation and its impact on Africa, considers growth predictions and where the adoption of smart technology would be most beneficial in expanding industries to drive sustainable growth.
For the purpose of this study, focus was placed on four key sectors: water, manufacturing, mining and minerals, and food and beverage.
Some of the key findings in the report are:
- The adoption of digital smart technologies, innovation as well as a range of digital customer offerings, are expected to remain varied across industries, markets and geographies. The extent and impact of digital technologies are also expected to vary, favouring businesses and industries that seek relevance and increasing contribution in international markets in addition to existing domestic markets.
- While advanced analytics and digitalisation are witnessing growing adoption across certain industry sectors, such as the automotive sector, there is a real opportunity for adoption of these across industry sectors such as the mining and food and beverage industry, which are significant contributors to major African economies.
- Manufacturing, while the most mature in its transformation and adoption of digital smart technologies in Africa, remains a marginal player struggling to make a bigger impact on country GDPs. The question governments need to ask themselves is how they align a ‘here-and-now’ emphasis on job creation with the necessary focus on digitalisation. This will enable Africa to create a niche within the global economy. If we fail to pro-actively select our place within the global manufacturing industry, we run the risk of continuing on this path of non-industrialisation.
- In the water industry, expenditure on water infrastructure has been low when compared to the global average. Inadequate investment in infrastructure coupled with poor water utility management has resulted in a greater need for
developmentof the water sector.
- In the mining industry, which has been witnessing subdued investment, rising cost pressures, and increasing labour issues, a combination of mechanisation, efficient extraction of resources and better use of data can make it easier for mine operators to cut costs and create a leaner and more efficient mining operation. As such, the successful incorporation of technology will be possible through collaborative efforts of technology providers, industry, research institutes and organisations that work for uplifting the mining industry.
- A stable supply of electricity is critical for digitalisation to flourish. By providing high levels of infrastructure and power supply, Africa will be able to attract the necessary investment across various industry sectors.
Rapid urbanisation growth and smart technologies
The urban population in Africa is expected to grow to 56% in 2050, from 35% in 2010. This rapid urbanisation will require robust infrastructure to ensure these expanding cities are hubs of growth and commerce, and not still trying to catch up with basic necessities.
According to Ralf Leinen, the senior Vice-President digital industries for Southern and Eastern
In the wake of changing business dynamics, rapidly evolving technology and increasing competition, collaborative efforts between governments, industry, businesses (local and international), labour and academia is vital for creating an environment that is conducive to developing sustainability of local businesses, encourages technology upskilling, innovation, knowledge sharing and execution.