At the end of August 2019 Siemens South Africa launched its report on the status of digitalisation in industry in Africa and a call for fast and decisive action from African countries so that they can compete on the global economic stage.

In Siemens’ view, digitalisation is providing the continent the opportunity to accelerate growth and rapidly expand struggling economies – but it’s a small window and decision-makers need to put a strategy in place now in order to succeed.

Digitalisation impact and opportunities for Africa

The company, together 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.

Titled The dawn of digitalization and its impact on Africa, the study considers growth predictions and where the adoption of smart technology would be most beneficial in expanding industries to drive sustainable growth. It focuses on four key sectors: Water, Manufacturing, Mining and Minerals, and Food and Beverages.

Some of the key findings

  • The adoption of digital technologies, innovation and a range of digital customer offerings is expected to remain varied across industries, markets and geographies. The extent and impact of digital technologies is also expected to vary, favouring businesses and industries that seek relevance and aim to increase their contribution in international markets as well 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 these technologies to be adopted across industry sectors such as the mining and food & beverage industries, which are significant contributors to major African economies.
  • Manufacturing, while the most mature in its transformation and adoption of digital 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 in the global manufacturing industry, we run the risk of continuing on this path of non-industrialisation.
  • In the water industry, expenditure in water infrastructure has been low, compared to the global average. Inadequate investment in infrastructure coupled with poor water utility management has resulted in a greater need for development of the water sector.
  • In the mining industry, which has over the past several years witnessed 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 leaner and more efficient mining operations. Collaboration among technology providers, industry, research institutes and organisations would enable the successful incorporation of technology to benefit the 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.

The urban population in Africa is expected to grow to 56% of the total population by 2050, from 35% in 2010. This rapid urbanisation will require robust infrastructure to ensure the expanding cities are hubs of growth and commerce and not still trying to catch up with basic necessities.

Commenting on the release of the Frost & Sullivan report and its findings, Ralf Leinen, Senior Vice President, Siemens Digital Industries for Southern and Eastern Africa said: “For the first time in history we have an incredible opportunity to use smart technology to transform entire economies at an unprecedented rate. Africa needs to put efficient strategies in place now in order to succeed.”

In the thrust of changing business dynamics, rapidly evolving technology and increasing competition, collaborative efforts among governments, industry, businesses (local and international), labour and academia are vital to creating an environment that enables local businesses to develop sustainably and that encourages technology upskilling, innovation, knowledge sharing and implementation.  

Siemens notes that the findings from the study are just a starting point. The hope is that it will begin a dialogue and provide a framework to some of the unique opportunities that exist.

For more information visit: https://new.siemens.com

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