CEOs from six prominent African mobile service providers have issued a joint statement at the MWC Kigali 2023 event, addressing the importance of government policy reforms in Africa to support digital growth.
The group, representing leading operators in the region, emphasised the need for new policies that promote the positive and inclusive impacts of mobile technology, with a focus on addressing investment and usage gaps.
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Championing Tax Reform
The CEOs called for comprehensive tax reform, citing the GSMA Mobile Tax Policy and Digital Development report’s revelation that taxes and fees currently account for 30% of industry revenues. They emphasised that tax rationalisation and targeted fiscal policy reforms can enhance affordability for consumers and incentivize operator investments.
One key recommendation is the removal of taxes on low-cost smartphones, as well as sector-specific taxes. By implementing these reforms, they believe it will stimulate economic growth and advance digital development in the region. The CEOs highlighted the industry’s current contribution of $170 billion (8.1% of GDP) to the sub-Saharan region. The sector has committed to investing an additional $75 billion, expecting to boost sub-Saharan Africa’s GDP by $210 billion by 2030.
Regulatory Support and Climate Action
In addition to tax reforms, the CEOs urged governments to provide regulatory support for implementing the UN Broadband Commission’s recommendations for bridging broadband connectivity gaps. They also called for climate action policies to enhance access to renewable electricity for corporate buyers.
While the mobile industry plays a vital role in Africa’s development, the CEOs stressed the need for ongoing political support. They emphasised the importance of establishing the right market structures and conditions to avoid unnecessary fragmentation, along with policies that facilitate the investment environment necessary for the industry’s success. The CEOs are confident that with the right policy reforms, the mobile sector in Africa can continue to drive growth and digital development across the continent.
The mobile sector in Africa has been a significant catalyst for socio-economic development, particularly in regions where infrastructure and traditional telecommunications services may be lacking. With over 1.1 billion mobile subscribers on the continent, mobile technology has provided essential services, including access to banking, healthcare, education, and e-commerce, even in remote and underserved areas.
However, the CEOs noted that despite the industry’s substantial contributions, it continues to face challenges, especially in terms of taxation. High taxes and fees, which account for a significant portion of industry revenues, can hamper affordability for consumers and act as a disincentive for further investments. By reforming fiscal policies, the sector can provide more accessible and affordable mobile services, encouraging broader adoption and stimulating economic growth.
Removing taxes on low-cost smartphones is one of the key proposals set forth by the CEOs. By making smartphones more affordable, it opens the doors to digital inclusion, enabling more individuals to access essential services, educational resources, and job opportunities. Additionally, sector-specific taxes, which can create financial burdens for operators, were also highlighted as a barrier to growth. Removing these barriers can unlock the full potential of the mobile industry in Africa.
The mobile industry plays a pivotal role in Africa’s economy, contributing $170 billion (8.1% of GDP) to the sub-Saharan region. It has also committed to investing an additional $75 billion, with the expectation of boosting sub-Saharan Africa’s GDP by $210 billion by 2030. These investments have the potential to create new industries, jobs, and opportunities for economic growth.
Regulatory Support and Climate Action
In addition to taxation reform, the CEOs have called for regulatory support to implement the recommendations of the UN Broadband Commission’s 21st Century Financing Models for Bridging Broadband Connectivity Gaps. By facilitating an environment that supports investment and innovation, it is possible to bridge the digital divide and ensure that mobile services are available to more people across Africa.
Moreover, climate action policies were highlighted as essential for improving access to renewable electricity. The mobile industry has a significant role in providing access to connectivity and services in remote areas, and sustainable energy sources can further enhance its reach and impact.
A United Front for Digital Growth
The CEOs’ joint statement represents a united front among major African mobile operators. They have recognized the challenges they face in the current policy environment and have expressed a collective commitment to addressing these issues. By working together with governments and stakeholders, they aim to create an environment that fosters digital growth, empowers individuals, and drives socio-economic development across the African continent.
