Can Africa jump from the second to fourth industrial revolution without passing by the third?

In a period where businesses in developed countries move towards the fourth industrial revolution, embracing robotization, artificial intelligence, Internet of Things, blockchains and 3D printing, Africa still finds difficulties in carving out its space into the third Industrial Revolution.

The latest UNCTAD Technology and innovation report (2023) shows a low use of new technologies by African firms. Exemplary is the case of Ghana, where a mid-2022 survey conducted in 500 establishments found low levels of adoption of these technologies vs. a high level of awareness by local firms about them. The main culprit, especially in Sub-Saharan Africa, is the electricity access, that still constitutes – according to the interviewed operators – the biggest obstacle for using the tools of the fourth industrial revolution, which are all electricity (and internet)-intensive.

The report also points out how much of existing gap between developed and developing countries is determined by levels of investments in Research and Development (R&D). In comparing expenditure on these activities, the report indicates as top global performers Israel and the Republic of Korea, which invest both around 5 per cent in R&D. In the European Union, instead, expenditure for R&D is about 3 per cent of GDP. When it comes to Africa, the proportion collapses. Egypt invests around 1 per cent, while in South Africa the expenditure ranges between 0.5 and 1 per cent. In many African countries, less than 0.50%. Last year, the AUDA-NEPAD published the Second Continental report on the implementation of Agenda 2063, which emphasized the slow pace of industrialization in Africa, with the contribution of the manufacturing sector as a proportion of GDP of only 11% in 2021 (in comparison, in Europe it was in the same year 15%), pointing out how the share of R&D expenditure as a proportion of GDP in Africa is estimated at a miserable value of 0.45%.

In a climate of “equal partnerships” or “partnership of equals”, as many trade blocks external to the continent say the relationships with Africa should be framed in future, African companies should refuse to fall into the trap of creating partnerships with foreign companies where they keep focusing on the low-middle layers of the value chain, leaving those stages of the production process that require more advanced technologies to the latter. This would be tantamount to still trying to find a place in the third industrial revolution… when others are now moving toward the fourth.