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Published On: Wed, Apr 11th, 2018

Patterning Africa after India’s IT Boom

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By Anthony Ademiluyi

India was in a mess in the early 1990’s due to her decades of the pursuit of socialism which had become a clog in the wheel of her economic growth and development. Manhomman Singh, an Oxford and Cambridge trained economist took up the daunting challenge of re-directing India to the path of prosperity powered by the ideals of a free market economy. He devalued the rupee; privatized state owned enterprises and massively encouraged foreign direct investments.
What he did not envisage for was the fact that the country of 1.2 billion people will be the world’s greatest beneficiary of information technology outsourcing. It is the country with the highest number of English speakers worldwide – greater than the United States and United Kingdom combined. The vision of Singh paved the way for the great wealth transfer in the world’s second most populous nation on earth. India is unmatched when it comes to its large pool of skilled and talented human resources. It has 3.1 million skilled graduated added to its workforce annually and it saves western multinationals a great deal of money to hire Indian workers whom they do not even have to physically meet. It costs an average of $50 to $100 an hour to contract the services of a good developer. A competent Indian will be happy to receive $15 an hour for an equally if not a better job.
The infrastructure in India is well positioned to take full advantage of the outsourcing trend – a gain of globalization. She boasts of state-of-art telecommunication services, super swift internet connectivity, submarine cables, massive bandwidth in all the major cities and fibre optic cables. The public policy thrust is geared towards providing stable and attractive information technology policies. IT is regarded as one of the top five priority areas in the country with tax breaks offered to IT firms to attract such services in call centre, date entry, transcription, engineering, software development, finance/accounting, photo editing services and web analytics and the revenue that accrues to the country is estimated at $69 billion annually.
India, a hitherto third world nation has been able to pull itself by the bootstraps and lift millions out of the debilitating scourge of dire poverty by tapping into the goldmine of IT outsourcing. It is a well-known fact that the world has transited from the industrial age to that of information. Many African nations are now facing the realities of this without being adequately prepared to respond to it. Natural resources such as gold, cocoa, oil, diamonds etc now have their prices subject to the cruel vagaries of the international market and the ‘dark continent’ is at the receiving end as new alternatives to them have massively cut down their demand leaving the nations impoverished.
Information Technology is the fastest way to wealth. Some examples will suffice. It took Mark Zuckerberg, the Chief Executive of Facebook three years to become a dollar denominated billionaire. It would have been two if he had accepted the offer from Rupert Murdoch’s Newscorp to acquire his novel innovation for $1 billion in 2006. Not only is he the world’s youngest self-made billionaire, he is the fastest as his feat is still so surreal. Jan Kuom and Brian Acton who co-founded whatapp had their acquisition snapped up by facebook for $19.5 billion. Ironically, they sought jobs in the latter and were turned down.
The likes of Jerry Yand and David Filo of Yahoo, Larry Page and Sergin Brin of Google, Bill Gates and Paul Allen of Microsoft, Larry Ellison of Oracle etc made their mind boggling fortunes from it in far less time than it took the so called oil barons and natural resources merchants. If we are to solve the perennial crisis of unemployment, IT is the way to go as the opportunities for self-reliance inherent in it is endless and this is the new mantra being sung even in the developed world where many African youths dream of escaping to as the demands of the new age is titled towards self-employment.
Africa is plagued by daunting challenges such as the dearth of physical infrastructure, economic/political instability, poor security, lack of in-demand skills by the so called tertiary education graduates, corruption and poor regulation by the government. These challenges have to be sturdily addressed backed by an IT driven policy that would enable the continent tap from the gains of globalization via IT outsourcing and stop being a perpetually dependent continent.
Ghana seems to have taken the cue as their leaders are concerned with the drastically falling prices of gold and cocoa – their two major economic mainstays and coupled with the fact that the prices of crude oil have fallen in the global market. The visionary former President John Agyekum Kuffour initiated a partnership project between India and Ghana and invested $5 million on a youth driven ICT project. It converted offices belonging to the State Housing Corporation for the project which will be sited in all the ten regional capitals. The current President, John Mahama continued the vision when he unveiled a three year plan to build an IT hub at the cost of $10 billion.
This project will employ 50,000 people and house a further 25,000. Kenya followed suit by revealing a plan in 2013 to build an African Silicon Valley within the next 20 years at the cost of $14.5 billion. It is instructive to note that 40,000 Kenyans are on Elance – the online service that enables professionals sell themselves and attract a fee for their time. This is a step in the right direction as outsourcing has come to stay and Africa should not be left behind.
There should be a vigorous agenda by the respective governments to ensure that we overtake Latin America and Eastern Europe which is now the focus of IT outsourcing as companies want to play India against them to get the best deals. We should transit from being a mere dumping ground to partners in progress. The Japan miracle after the battering as a result of the second world war was possible because of the nationalist sentiments orchestrated by the government which made their citizens come back home after tapping from the American wisdom. In this era, there is no need to even go across the Atlantic.
All that is needed is the political will to ensure that African citizens are well positioned to get the best deals from the comfort of their homes so as to avoid the second slavery.

Anthony Ademiluyi writes in from Lagos

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