What is the digital economy, and what powers it?
These are some of the questions the Estonian government tasked itself with back in the early 90s as it set on a mission to be the “world's most digitally advanced society.” Today, the country is hailed as the role model for governments, “where almost every bureaucratic task can be done online.”
It’s what countries around the world tapping into the opportunities presented by the digital revolution arguably aspire to or borrow from.
Innovations in the digital economy are changing conventional notions about how businesses are structured, interact and how consumers obtain services, information, and goods.
A recent report by the World Bank estimates that by 2025, the resulting impact of the internet economy could contribute nearly $180 billion to Africa’s economy.
Traditional economic statistics are not equipped to capture the nuance of how digitisation impacts economic activity in Africa, and bad decisions or policies are made with a poor understanding of reality.
Yet, the digital economy remains elusive and hard to grasp. This underlies numerous discussions at the Stears’ Technology, Innovation & Digital Economy sessions—as the digital economy is a tricky one to pin down, even for economists.
As our Head of Intelligence, Michael Famoroti, notes, it’s hard to pin down a widely accepted definition of the digital economy. Only the telecoms and ICT are formally captured in the GDP measurement in Nigeria. Many other sectors, such as fintech, are subsumed into their traditional industries, i.e. finance, making it difficult to identify their contribution.
Even trickier, elements of digital society, which include governance, security, identity and regulation, are not even reflected in