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With sub-Saharan region being the fastest growing ICT market in the world, Angola represents the biggest one in the area. Besides its natural resources like oil and diamonds, the country is making huge leaps in ICT infrastructure and development in order to use technology to boost trade.
Although Angola has a population of over 20 million, the internet users are estimated about 3 million while the mobile users are more than 13 million with 70% youngsters and 3,5 million of them have an internet connection on their mobile.
To better understand the huge growth in mobile use, just a decade ago there were about 140,000 mobile users and with a compound annual growth rate of 56% that number has surpassed 13 million users.
African countries vs. the western financial instability
The African countries and markets represent a great potential in terms of people, resources and growth. While most countries in the west were hit with the recent economic crisis, African countries as a whole grew at a rate of 5.1% in the last 10 years based on macroeconomic studies. Especially southern African countries, including Angola, grew an impressive 7.8% during 2014.
This notable growth over the last decade for the Angolan economy led to becoming the third largest economy in the sub-Saharan region and the telecommunication sector contributed a significant amount to that extend. The key role of telecommunication in the country’s growth can be underlined with the launch of Angosat, the first telecommunication satellite that was announced by the President of the country.
Furthermore, the period of peace after the civil war that ended about a decade ago has sparked the outside interest and investment in key sectors such as banking, oil and telecommunications, which had huge barriers for foreign private investors. Primarily, telecommunications is a very attractive sector for foreign investors and two agencies – Angola Telecom and the Angolan Communications Institute (INACOM)- are regulating and observing the industry.
The penetration in telecommunication is significantly high for mobile 89%, compared to fixed lines 1.5% and internet users 24%. The market is clearly in its early stages of development and new players can take advantage of the rapid growth in infrastructure and new users entering the market.
The potential of the Angolan ICT sector
Due to its geostrategic position, Angola can become a hub for the telecommunications in Africa and currently is the lead in development in the sector. The SAT-3 and WACS, two very important submarine cables run through Angolan territory and there is also planned a connection between Africa (Angola) and South America (Brazil). What is more impressive, during the last 5 years, around 20,000 km of long distance and metropolitan optical fibre were installed in the country with part of it connecting Angola with neighbor countries.
The ICT sector as part of the economy
There is a lack of data, in terms of statistics about the workforce etc., but it is estimated that the direct jobs in the ICT sector are between 10,000-15,000 and the indirect jobs lie somewhere between 40,000-60,000. It is a significant number, taking into account the development of the entire nation, and that number is bound to increase given the expected growth of the market. ICT companies and products are present in every aspect of the human life in western countries and in the near future so will be in Angolan lifestyle too. Therefore, the public and private investments made in this area will be towards that direction with focus in creating more efficient and competitive businesses that will add value to the country’s economic growth.
The successful development of the ICT industry is based on some critical factors that will guarantee the development process. Updated legislation to reflect the current ICT reality is the most prominent. The local government has included the expansion of mobile networks of the rural regions at the top of the ICT agenda, which will benefit agriculture, education and healthcare to name some.
Esoko, a mobile tool for farmers that helps them to easily access market information and prices as well as crop production levels, is being used in 15 African countries and already has a success story in Ghana, helping local farmers to increase their revenues by an average of 10%. Also, Machine to Machine (M2M) services that will help farmers to increase their productivity by controlling machines remotely or automatically are expected to become more common, so there is great potential in that field for newcomers and established businesses.
We already noted the size of mobile users in the country and the percentage that have access to the internet though their device, and this number is expected to grow fueled by new subscribers from the rural areas. If you are offering a mobile service or app though and looking to expand there, you should take under consideration the price barrier the might prevent new users from signing up to your service.
As stated above, due to its geographic location and demographic characteristics Angola is one of the most alluring and promising ICT markets in Africa. Taking into account the growth of the entire economy and the focus of the local government in the ICT industry as a catalyst for the country’s development, Angola is a land of opportunity for ICT players of all sizes and flavors – from IT equipment vendors to application developers and operators.
The priorities of the Angolan government are promptly defined: the creation and establishment of e-government, the development of current public infrastructure, the increase in IT talent and training for young people, attracting international companies in order to invest in local projects and update the communication infrastructure and quality.
To that direction, two government datacenters have been inaugurated in 2012 and a third one is in the works by the technologic campus. These datacenters provide services to all business sectors, both public and private.
The 12 initiatives Action Plan
The Angolan government has created and implemented a 12 step program to increase the competitiveness and development of the ICT industry in the future. These steps include internet public access points, local media libraries, fixed and mobile digital techcenters for rural areas, ICT equipment for youth houses and community centers, financing PCs and smartphones, ICT promotion and debate progrma, ICT professional training courses, courses for entrepreneurs, ICT internships, youth portal, monitoring and reporting systems.