What Africa's social and digital clampdowns mean for doing business

Restrictions not only silence or limit the citizenry; they also have a very real economic cost.

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Africa has a history of clampdowns on internet usage, and given the increasing role of web-based applications as well as social and digital media in business, these restrictions have an impact not only on users, but also on enterprises hoping to leverage these technologies.

The examples are numerous: In January, the Zimbabwean government shut down access to the internet in a bid to stop coverage of government response to protests about a fuel increase. Ethiopia has seen similar disruption of internet services by government during states of emergency, and even to prevent cheating in national exams. Uganda introduced a social media tax of 200 Ugandan Shillings (US$0.05) a day in 2018 for the use of voice and messaging apps over the internet, otherwise known at Over the Top (OTT) services. Zambia set a fixed tax rate of 30 ngwee (US$0.03) on internet phone calls. Benin introduced and then repealed a similar tax the same year; the Benin government has also resorted to internet shutdowns during elections.

These clampdowns not only silence or limit the citizenry; they also have a very real economic cost. It cost Zimbabwe's economy US$5.7 million for a one-day internet shutdown, according to NetBlocks’ Cost of Shutdown Tool (COST). Africa is second  behind Asia in terms of the number of internet shutdowns, with 46 confirmed between 2016 and 2018, according to AccessNow.

Africa’s digital revolution has birthed new technology enterprises, with significant positive impacts on job creation, income generation and overall national productivity, according to Dr Seun Kolade, Senior Lecturer in Strategic Management at De Montfort University. However, government shutdowns and use of taxation have had significant impact on businesses, slowed down the pace of digital innovation, and hindered the efforts of entrepreneurs to create job opportunities in a region where poverty and youth unemployment is widespread.

Work-arounds are seen as necessity

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