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Technology leaps in Africa

I recently returned from a research trip across four East African countries. Every time I return from the region, I am energized by the dynamism of the young people I meet but overwhelmed by the challenges the region faces. The combination of high oil and food prices affects the United States economy, to be sure, but the impact on poor people in poor countries is exponentially greater. People have to make hard decisions like taking their children out of school, rationing the little food they have, and in some cases not eating at all. High fuel prices also contribute to lower uses of fertilizer, resulting in lower agricultural yields. The cycle spirals in a way that hurts the poorest people the most.

And yet there is another story unfolding simultaneously in Eastern Africa. It is the story of Safaricom, the most successful telecom company on the continent. Safaricom started trading publicly on the Nairobi stock exchange in June and catalyzed the largest IPO on the continent ever. More than $800 million was raised from Kenyans from all walks of life, resulting in an over-subscription of stock of more than 400%. Mobile is growing faster in Africa than in any other part of the world. While levels of internet penetration are well below 5% for the continent, nearly 40% have access to mobile phones and Nairobi sends more text messages in a single day than New York (a statistic frequently quoted in the region).

Ten years ago people were talking about land lines and how they would ever penetrate rural Africa. Infrastructure has long been a constraint on economic development and growth in Africa but nobody imagined that a new technology would completely leap-frog the traditional phone and fundamentally disrupt telephony in Africa. I can't help but think about rural energy in the same light. Today, countries like Uganda are still 90% unserved by electricity. Can you imagine not having power in 90% of any country and still trying to grow the economy? Do we expect Africans to wait for grid electricity to incrementally reach people or are there disruptive innovations that can provide off-grid renewable energy to rural Africans in scaleable ways? What would this look like given large geo-thermal and bio-diesel reserves in East Africa and can renewable energy sources provide opportunities for greener solutions in Africa?

Interacting with dynamic and bright Africans under 30 (who make up 70% or more of most African countries), I cannot help but wonder what is on the horizon. People are innovating all over the continent with bio-gas, small scale hydro, wind, and solar power. Where people have electricity, there is a massive difference in economic activity, public services, productivity, and hope about the future. Energy is truly a platform that affects nearly every aspect of rural life. Today, Africa is mostly unserved by power grids but given innovation possibilities, are there not scalable ways to introduce renewable energy to millions of people who are completely unplugged from the global economy today?

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