Building Resilient African Digital Economies Post-COVID: Focus on Tanzania

By Maeva Yrio

ATBN, together with the AfriConEU consortium of partners, is working to foster collaboration between African and European Digital Innovation Hubs (DIHs) and build a thriving EU-Africa innovation ecosystem. On June 23rd, we hosted our last African Digital Ecosystems roundtable, this time focusing on Tanzania. Tanzanian Digital ecosystem stakeholders were brought together to discuss how DIHs can help local startups and businesses harness the opportunities that have emerged from the COVID-19 pandemic and address the challenges they face. Below are some key takeaways from our panel discussion featuring Iku Lazaro – Co-Founder, Shule Direct, Godfrey Kilimwomeshi – co-Founder, Fundi App, Promise Mwakale – Partnerships lead, Buni Hub

How has COVID-19 impacted the Tanzanian Digital Innovation Ecosystem?

The COVID-19 pandemic has provided great opportunities to the Tanzanian Digital Innovation Ecosystem but not without its share of challenges.

On the positive side, the accelerated transition towards digital services forced businesses to capitalise on this momentum by adopting online solutions. “It is a great opportunity for people to see how they can tap into this market, innovate more and create resilient start-ups” said Godfrey Kilimwomeshi . The online transition also enabled a broader client outreach which resulted in additional customers for businesses and users for hubs. Many businesses were able to capitalise on this digital transition. Promise Mwakale noted that in Tanzania, start-ups focussed on creating systems for the public sector highly profited from this online shift as demand soared with the government being forced to gradually go digital. The pandemic has also helped to catalyse cross-sector partnerships in order to overcome digital challenges. For example, Iku mentioned that Shule Direct was able to partner with some of the biggest mobile network operators across the country to deliver zero rated services to ensure students could attend the courses online for free while at home.

However, the pandemic has also dramatically impacted the Tanzanian digital ecosystem in terms of funding and digital access. Several supportive programmes that could have played a major role in business growth (such as grants or capacity building programmes) were cancelled or postponed. In addition, travel restrictions hindered startups’ ability to fundraise. Given the still limited funding ecosystem in the country, many Tanzanian startups seek capital outside of the country, particularly neighbouring Kenya. Furthermore, digital hubs were hard hit by the pandemic as most of their revenue streams were highly dependent on offline activities such as office rental and events.

The digital gender divide

The COVID-19 pandemic also emphasized the digital divide in the country as only those who have access to devices, electricity and internet were able to access online education opportunities. It was highlighted that women entrepreneurs were the most affected by the digital access gap. According to Iku Lazaro, women are not only confronted with technological issues but also face unique challenges stemming from gender norms and roles. For example, she notes that a user study conducted by her organisation Shule Direct found that in Tanzania, men are often the sole owner of digital devices, especially in rural areas. Even when women owned a device, they were in many cases constrained by limited technological know-how or financial means to fully make use of them. Another striking example was found in secondary schools where only men teachers have laptops, unlike their female colleagues. “Technology is an enabler for inclusion”, noted Iku. She further emphasized the role of hubs in helping to change mindsets and address gender issues during programmes. By starting a behaviour change campaign portraying successful female role models, she is hoping to attract more women and girls in the digital space.

Is the digital legacy going to remain?

For Godfrey, it is too early to say, it might have just been the “Covid Hype”. COVID-19 has ushered us all into a new digital era and created uncertainty for the future but while some people have chosen to take the online transition further others have prefered to go back to “normal ways” of working. “Businesses will have to decide whether or not they wish to tap onto the digital market on a long term basis” said Godfrey. According to Iku, what has happened because of COVID is permanent but perhaps what would take more time is the adoption and access to digital services by everyone.

For a more fundamental digital shift to happen all panelists agreed that increased collaboration between digital ecosystem stakeholders and support from the government are key. On one hand, hub leaders, innovators and funders need to come together to collaboratively design tailored programmes for start-ups. On the other hand, the government needs to create an environment conducive to innovation with most importantly stable and reliable infrastructure. “At the moment people have come to realise how easy it is to use digital services and as long as it keeps working, people will keep on using those services” declared Promise.

For its part, the Tanzanian government is taking promising steps towards sustaining the digital shift. In recent months, the government has implemented free toll numbers, zero-rated basic digital services, removed taxes on devices and boosted infrastructure investments. Their goal is for 100% of the population to have access to the internet by 2025.