Harnessing transformative technologies in Africa for regulatory impact: challenges and opportunities
At the Africa Investment Forum 2023, experts recommended harnessing transformative technologies in Africa to stimulate economic growth. However, transformative technology requires transformative governance. Regulatory authorities therefore need to stay abreast of the industry’s technological developments to be able to fulfill their functions effectively. This means implementing new digital technologies to enhance regulatory processes, as well as creating a regulatory environment that is conducive to the adoption and effective use of these technologies.
Transformative technologies for regulatory impact are already at work in Africa. Indeed, some countries have successfully leveraged Big Data analytics, for example, to build their regulatory capacities in the telecoms and digital financial services sectors. However, overall, adoption remains low.
As technological partner of the ITU, GVG answered the organization’s recent call for contributions under the overall theme “Charting the course of transformative technologies for positive impact”. On this occasion, GVG provided the ITU with a document describing the challenges and opportunities related to embracing transformative technologies from a regulatory perspective.
Challenges to harnessing transformative technologies in Africa
Comprehensive regulatory frameworks are necessary to promote data access and data transparency. In the telecom sector, for example, regulators need to be able to access the data collected by the MNOs to have optimal visibility over the sector. Furthermore, regulatory frameworks also help ensure the security of the data. In their absence, the MNOs and even their subscribers may be reluctant to share data.
Interoperability-enabling infrastructure is also a prerequisite to the successful implementation of transformative technologies. New technologies support the digitalization of payments, including citizen-government and government-citizen payments. However, the lack of interoperability hinders the growth of electronic payments and overall volume growth. For example, of all the instant payment systems available in Africa, only 44% support interoperability. This ultimately limits the potential benefits of financial innovation and inclusion.
A lack of interaction also exists among stakeholders. Indeed, limited coordination between regulatory authorities, private entities and other government agencies is a key constrain when it comes to accessing data with a view to supporting the successful deployment of technologies.
Another challenge for regulatory authorities is the hiring of skilled staff to deploy and operate the technologies. According to an Oxford Business Group report, an estimated 230 million jobs in Sub-Saharan African will require digital skills by 2030. However, there is currently a paucity of STEM skills in the region, with only between 3 and 26 professional engineers per 100 000 people, compared to 269 in the UK and 281 in the US.
Finally, it is crucial that the backbone of the systems the regulators implement follow the highest security standards. This will help ensure the respect of data privacy laws and guarantee the implementations are carried out safely and with the right tools to offer protection against fraud and security breaches.
Creating opportunities for enhanced regulatory capabilities
Addressing the challenges above to support the effective implementation and use of transformative technologies will enable regulators to build their decision-making and compliance monitoring capacities, as well as to foster innovation within regulatory frameworks.
Transformative technologies help increase efficiency and accuracy, by streamlining and automating regulatory processes. They also allow for the rapid analysis of large amounts of data, which enables data-driven policy development. By leveraging data analytics, policymakers can gain valuable insights into societal trends, identify emerging risks, make informed decisions more efficiently, and design more targeted and effective regulatory interventions.
Regulators’ compliance monitoring capacities are also enhanced through transformative technologies. Indeed, they enable the real-time monitoring of compliance with the regulations and policies in force. This allows the regulators to detect anomalies effectively within the sector they oversee, and to promptly take the measures needed to enforce compliance. As a result, transformative technologies contribute to increased transparency and accountability within the industry. They do the same in the regulatory environment, by reducing human error, which can negatively impact both costs and reputation, and by clearing information silos. This ensures that all parties involved in the process are aware of what is going on at each stage.
Lastly, transformative technologies can foster innovation within regulatory frameworks. This is important because regulators need to adapt to the technological advancements brought about by the digital transformation in Africa to be able to fulfill their regulatory mandate effectively. By adopting flexible and adaptive regulatory approaches, policymakers can encourage the development and adoption of innovative technologies, while ensuring that adequate safeguards are in place to protect privacy, safety, and security.
Harnessing transformative technologies in Africa for positive impact: The regulatory way forward
Regulatory bodies play a crucial role when it comes to harnessing transformative technologies for optimal impact. Indeed, they support the creation of a regulatory environment that is favorable to the adoption of these technologies. Fostering the positive and inclusive impact of transformative technologies requires regulators to establish comprehensive standards and guidelines, continuously assess the impact of regulatory measures on technology adoption and prioritize inclusive stakeholder engagement.
Appropriate standards and guidelines support the safe and effective development and deployment of transformative technologies. Ideally, they should include principles such as fairness, transparency, and accountability. By adhering to them, regulators can ensure that transformative technologies are used responsibly and contribute towards sustainable socio-economic market practices.
Once the relevant regulatory measures are in place, regulators need to monitor them closely. Through continuous monitoring, the authorities can assess the impact of said measures on the adoption and use of transformative technologies. They can also obtain useful feedback from stakeholders. As a result, they can adapt their approaches to ensure that transformative technologies foster positive outcomes and promote inclusivity across society.
Finally, collaboration between regulatory authorities and stakeholders, including industry representatives, civil society organizations and academia, is key to effective regulation when it comes to harnessing transformative technologies in Africa. Involving stakeholders in regulatory processes will give the authorities the possibility to gather and integrate various perspectives. This will then allow them to better understand the impact of transformative technologies and to create regulations that address needs and potential concerns.
Leveraging the expertise of technology providers
The rise of transformative technologies is putting pressure on regulatory authorities to adapt their processes. This means that regulators themselves need to embrace these technologies to effectively oversee the sectors they are responsible for. Overcoming the challenges to technology adoption would open a world of opportunities for regulatory authorities and their sectors. In addition to creating and monitoring the necessary standards and guidelines, and to fostering enhanced collaboration with stakeholders, regulatory authorities can also investigate public-private partnerships, such as the ones GVG formed with some African telecom and revenue authorities, to help them use transformative technologies for optimal regulatory impact.
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