Can President Cyril Ramaphosa Revitalize South Africa’s Tech Sector?

By Tom Jackson AFKI Original Published: March 4, 2018, 2:11 am
President Cyril Ramaphosa is aiming to build South Africa's tech sector. Photo - eNCACyril Ramaphosa is aiming to build South Africa's tech sector. Photo - eNCA

South Africa finally has its “new dawn”, in the words of newly-installed president Cyril Ramaphosa. But what does the business-friendly new leader have to offer the country’s tech sector?

Ramaphosa’s main claim to the presidency was based around his business expertise, and he has expressed a desire to open South Africa for business once more and jumpstart flagging industries. The rand has responded in a positive manner.

South African tech is an important space, but has been in the doldrums for too long. Ramaphosa, and new minister of science and technology Mmamoloko Kubayi-Ngubane, have a long list on their hands.

What is happening with the country’s broadband plan? Where are we with digital migration? What happened to the much touted small and medium enterprise fund? All these are major issues in Ramaphosa’s in-tray.

None of this will be easy to address in the short-term given the budget deficit, but the new president must act quickly to prevent South Africa from falling behind the rest of the continent. The country has long been a leader in Africa’s tech space, but new impetus is required to maintain that position.

The positive reaction to Ramaphosa’s elevation from business should help to ensure that there is increased investment in ICT infrastructure as the country strives towards universal connectivity, while more collaboration between the private and public sector is likely.

The new president would also be well advised to ensure young people are taught the necessary skills to build up a strong IT workforce.

With better infrastructure and more trained engineers, coders and developers in place, South Africa can make more progress towards implementing tech in sectors like education and healthcare.

Ramaphosa is also expected to implement an e-government policy, digitizing government processes in an effort to improve service delivery and make government more transparent. The success of the eFilling initiative should encourage this.

The new president certainly talks a good game, promising in his maiden State of the Nation (SONA) address that he will establish a “digital industrial revolution commission” to make sure South Africa is “in a position to seize the opportunities and manage the challenges of rapid advances in information and communications technology”.

The country’s prosperity, he said, depends on its ability to take “full advantage of rapid technological change”, and as a result South Africa needs to “develop our capabilities in the areas of science, technology and innovation.”

“The drive towards the digital industrial revolution will be underpinned by the availability of efficient networks,” Ramaphosa said.

Yet these words need to become actions. The controversial Electronic Communications Amendment Bill, which involves taking spectrum from mobile operators and creating a wholesale open-access network (Woan), has provoked the ire of operators. Vodacom CEO Shameel Joosub said it does not address the “urgent need to access available spectrum”, and it risks creating an infrastructure monopoly. It needs revisiting.

Meanwhile, the government made much hay with its 2016 establishment of a R1.5 billion SME Fund to support high-growth small businesses. High-growth small businesses, however, have yet to see the benefits, with not a single investment made. Progress needs to be sped up.

These specific issues aside, much of what Ramaphosa can do for the tech space depends on what he can do generally. The widening deficit needs cutting, but small tech businesses must hope that does not come in the form of VAT increases, but rather the promotion of economic growth.

Research has found that 15 percent of invoices in South Africa are paid late, with more than eight percent of payments due to small and medium businesses never made or made so late that businesses are forced to write them off. Something must be done to address this.

Infrastructure is the elephant in the room. The billions of rands that have been earmarked over the past few years must at last be spent. The digital divide needs closing, with businesses encouraged to embrace technology. Government must set a good example.

In tech, as in every other space, President Ramaphosa has talked a good game. Now that he gets down to the nitty gritty of running the country, however, words need to be replaced by action if South Africa is to maintain its position as a continental tech leader.

Tom Jackson is co-founder of Disrupt Africa, a news and research company focused on the African tech startup ecosystem.

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