2024-07-21
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Text | Quadrant, Author | Yi Shi, Editor | Sun Erxi
The African continent, once considered a relatively backward market, is undergoing a technological transformation with AI technology and becoming a hot emerging economy in the global market. Analysts say that by 2030, Africa's artificial intelligence industry is expected to account for 10% of the rapidly growing global artificial intelligence market, and the size of Africa's artificial intelligence (AI) market will reach $15.7 trillion.
The African continent is becoming a new frontier for the development of global AI technology. For Chinese AI companies, what strategic significance does it have to grasp this trend and actively deploy in the African market? In this analysis, the Quadrant Think Tank will try to use market data to provide some expanded views.
While many companies are focusing their attention on mature markets such as Europe and the United States, Africa, once regarded as an "invisible" continent with lagging technological development, is quietly rising and becoming a new hot spot for the AI industry.
In the current wave of global industrial revolution, AI applications in Africa are developing rapidly. From Nigeria to Senegal, from Kenya to Ghana, from South Africa to Rwanda and Togo, many places in Africa are actively exploring the potential of AI implementation, and innovative applications with AI as the core function are emerging in an endless stream.
At the AI theme conference in Davos this summer, Erika Mbula, professor of economics at the University of Johannesburg in South Africa, said that there are many start-ups in Africa that promote AI applications in various fields, and the region needs these technologies to solve real problems, such as medical health checks, infectious disease prevention and control, and even in agriculture. In addition to the development of local companies, she also mentioned that companies such as Microsoft and Google have also made considerable investments in the field of AI in Africa.
The rise of Africa has also provided new growth points and strategic opportunities for Chinese AI companies. On July 2, at the Huawei Africa Connect Conference held in South Africa, Huawei launched the Galaxy AI network solution for southern Africa to accelerate the intelligence of southern Africa.
Africa, once considered a lagging market, is now taking AI as its driving force and has reached the forefront of market expansion potential. For Chinese AI companies, it is of great strategic significance to grasp this trend and actively deploy in the African market.
Africa has been using AI technology much earlier than is generally believed.
In 2022, the 2022 African AI Status Report released by AI Media Group showed that in the past five years, many companies on the African continent have been working hard to use AI to improve business efficiency. In 2022, more than 2,400 companies in Africa listed AI as their main business, 40% of which were established in the past five years.
In 2023, the generative AI craze swept the world, and commercial AI tools such as Chatgpt, DALL-E, and Midjourney became more and more common in Africa. According to the 2024 Stanford AI Index, 27% of Kenyans use ChatGPT every day, second only to India and Pakistan worldwide.Google search trends also show growing consumer interest in AI in Africa, with countries such as Kenya seeing a 270% increase in AI-related searches over the past year and a 400% increase over the past five years.
More and more developers are participating in the development of AI mobile applications in Africa. At the same time, the number of active users of AI applications in Africa is also growing.According to DataSparkle, there will be 141 AI-related applications in the African mobile application market in 2023, a year-on-year increase of 24%. The average monthly active user scale of AI-related applications exceeds 40 million.
Figure: Overview of AI-related application usage in Africa in 2023 Data source: DataSparkle
Over the past year, the pace of AI application updates in Africa has accelerated, and the number of new AI-related applications has grown at an alarming rate.
DataSparkle's latest report "Changes in the African Mobile Application Market Landscape in 2024" shows that by December 2023, the number of monthly active users of mobile applications in Africa will exceed 330 million. Among them, 730 applications have more than one million monthly active users, and the average usage time per person has reached more than 82 hours, and in North Africa it has reached nearly 100 hours.
Judging from the distribution of tracks, AI applications in Africa are mainly focused on conversational AI, with the most AI-related applications in games, photography, efficiency and personalization categories.
Figure: Distribution of AI-related applications in Africa in 2023, data source: DataSparkle
Driven by generative AI, Africa’s AI ecosystem is expanding rapidly.More and more start-ups are landing in Africa and developing AI applications, and the level of development is already far ahead of many regions in the world.For example, Intron Health in Nigeria developed natural language processing tools to understand African accents in clinical settings, minoHealth AI Labs in Ghana developed an AI system to diagnose 14 chest diseases, and iCog Labs in Ethiopia developed a general AI solution and created a robot that can speak Amharic...
Even more surprising is thatIn addition to the proliferation of mobile applications driven by generative AI, traditional AI technologies have also been widely used in Africa.Amal El Fallah Seghrouchini, executive chairman of the Morocco International Center for Artificial Intelligence in Rabat, believes that artificial intelligence is changing Africa and improving living standards across the continent in areas such as agriculture and healthcare.
Typical is agricultural applications, where Africa has used AI-driven tools to analyze farm conditions such as rainfall and soil health and provide actionable recommendations in real time, allowing farmers to make appropriate changes to increase crop yields. For example, in the Zanzibar Islands of Tanzania, farmers use an AI-assisted application called Nuru to detect the spread of a devastating cassava disease.
The huge demographic dividend and market potential have made Africa a "battlefield" for technology giants to compete.China's Cyberspace Administration (CAC) issued a statement in early April, emphasizing the promotion of technological research, development and application between Chinese and African enterprises, universities and scientific research institutions, covering areas such as big data analysis, machine learning, natural language processing and computer vision; Under Biden's "Prosper Africa" initiative, the African Technology Trade Alliance was established in April 2023. The alliance includes more than 20 private sectors such as PayPal, Mastercard, Cisco, Visa, and DHL.
Driven by favorable policies,Chinese and American companies are significantly increasing their investments in African public entities, financial institutions or private companies using AI applications.
In 2019, tech giant Google opened its first artificial intelligence center in Africa in Accra, the capital of Ghana;
In 2021, NVIDIA, one of the world’s largest chipmakers and a leader in deep learning, launched an emerging chapter program to help African communities scale AI projects;
In 2022, EarthRanger, a technology developed by the Allen Institute for Artificial Intelligence owned by Microsoft's late co-founder Paul Allen, was deployed to combat locust swarms in South Africa;
This year, Huawei released Galaxy AI network products and solutions for North Africa, including the network large model application Net Master.
The African continent, once considered relatively backward, is undergoing a technological transformation using AI technology and becoming a hot emerging economy in the global market.Analysts say that by 2030, Africa's artificial intelligence industry is expected to account for 10% of the rapidly growing global artificial intelligence market, and the size of Africa's artificial intelligence (AI) market is expected to reach US$15.7 trillion.
According to 36kr, since last year, tens of thousands of Chinese people have begun to go overseas on a large scale and head towards this new continent.They are more optimistic about the future of Africa and want to seize the world's last "billion-dollar blue ocean market."
So is it a good choice to expand AI to Africa?
Lu Peng from the Institute of Sociology of the Chinese Academy of Social Sciences pointed out that many people may have a stereotype that Africa is a "desert of the digitalization", but this is not the case. In the evolution process of "information society-network society-digital society-intelligent society",China is in the transition period from a digital society to an intelligent society, while Africa may be in the transition period from a network society to a digital society.Although the stages are different, the digitalization of Africa is truly happening, and the leapfrog development brought about by digitalization is also worth looking forward to.
In a speech titled “The AI Opportunity in Africa” at the African Academy of AI Journalists, Theo Watson, commercial lawyer at Microsoft Africa, predicted:By 2030, AI could generate up to $1.2 trillion in revenue for Africa, equivalent to a 5.6% increase in the continent’s GDP.
At present, although the development of AI in Africa has far exceeded expectations, it is still relatively in its early stages, and the African continent is still lagging behind in "controlling the improper use of artificial intelligence technology and seizing artificial intelligence market opportunities."
According to a report published last year by the Moroccan New South Policy Center titled "Africa's Artificial Intelligence Revolution: Economic Opportunities and Legal Challenges", South Africa, as the leader in artificial intelligence investment in Africa, has more than 700 companies investing in artificial intelligence, while Nigeria has at least 450 companies. In East Africa, Kenya ranks first with 204 companies, while Tanzania and Uganda have 44 companies each.
The growth potential of emerging markets is the core reason why Chinese companies are expanding into Africa to develop AI market. According to a report by the African Development Bank,Africa has the potential to become a leader in AI adoption given its large youth population, growing middle class, and increasing use of mobile and internet technologies.
The United Nations predicts that by 2050, the population of sub-Saharan Africa alone will reach 2.09 billion, and will further increase to 3.44 billion in 2100, accounting for 33.1% of the world's population. Africa will become the world's largest emerging market.
In terms of economic development, according to statistics from the African Development Bank, since 2010, Africa's overall economic growth rate has been higher than the global average almost every year, exceeding the average levels of Europe, North America, South America and the world, and the average GDP growth rate has remained at 3.8%.
As the market develops rapidly, African governments are also more inclined to make AI, an emerging industry, a core strategy.In Africa, more and more countries have begun to formulate dedicated artificial intelligence strategies. Along with this trend, African entrepreneurs and young people have shown great enthusiasm and desire for the field of artificial intelligence.
Many African governments have introduced policies to boost the development of the AI industry. Nigeria, Congo (Brazzaville), South Africa and other countries have formulated coherent AI industry development strategies and support policies.
In November 2019, Nigeria released the "National Digital Economy Policy and Strategy 2020-2030" and established a National Artificial Intelligence and Robotics Center; in February 2022, Congo (Brazzaville) established its first artificial intelligence research center, jointly planned and built by the United Nations Economic Commission for Africa and the Government of Congo (Brazzaville), and is committed to promoting digital technology in Africa in multiple fields through artificial intelligence; as a pioneer in Africa's digital economy, South Africa established the Presidential Commission for the Fourth Industrial Revolution in 2019 and participated in the formulation of the "Pan-African Artificial Intelligence Blueprint for Africa" plan.
From a policy perspective, Africa expects AI to better empower its own development; on the other hand,Africa also hopes to play the role of a "public space" for AI "industry integration" and "governance connectivity" among other major technological and industrial powers.
therefore,For Chinese AI companies going overseas, Africa has another obvious advantage:Friendly cooperation between China and Africa in the field of artificial intelligence is deepening. China and African countries are increasingly engaging in exchanges and cooperation in the fields of digital infrastructure construction and digital talent training.
However, limited by the level of economic development, the development of AI in Africa still faces many difficulties. For example, in terms of infrastructure, compared with other countries and regions in the world, Africa's power supply, network signal stability, and the popularity of Internet computers and smart phones are still relatively backward; in terms of data supporting AI technology, Africa lacks a comprehensive, timely, and accurate data collection system, and does not have a mature data governance framework to ensure data privacy and user security. In addition, the backward education level and insufficient supply of AI talents have also made it difficult for the African AI industry to develop on a large scale in a short period of time.
But at present, even facing many difficulties, it is impossible to stop the determination of African governments to develop AI technology. For African countries, promoting AI applications and scenarios is not only a rare opportunity to achieve "overtaking on the curve" in technology layout, but also the key to the long-term healthy development of the economy. For AI companies that are actively deploying overseas markets, it may be helpful to pay attention to the emerging market of Africa, which may bring extra surprises.
References:
Yisou Overseas "Going to Africa, how to define your next battlefield? | NEXT Cross-border Overseas" DeepTech Deep Technology "African labor is exploited by some AI companies, and it is difficult for African countries to participate in the formulation of AI standards" DataSparkle "The artificial intelligence (AI) boom is sweeping the African mobile field" Harry Clinch "Artificial Intelligence: Opportunities for Africa" Alibaba Research Institute "Outside Views | AI in Africa: Chinese Academy of Social Sciences-South Africa Jinshan University Enters Alibaba" Tsinghua University Institute of International Governance of Artificial Intelligence "The Development of Artificial Intelligence in Developing Countries-Observations from Africa and Latin America" Transsion Developer "ChatGPT is rapidly becoming popular, and Africa is joining the global artificial intelligence revolution" DataSparkle "Changes in the African mobile application market landscape in 2024: Huge growth potential in the application track" Roselake Africa Venture Capital© "How can African venture capital break through in the capital winter?"
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