A new report by the GSMA has highlighted Kenya’s significant strides in digital adoption and its potential for economic growth.
The Digital Africa Index (DAI), recently launched by GSMA at Movenpick Hotel, Nairobi, is a comprehensive tool designed to measure digital usage across Africa.
DAI ranked Kenya among the top performers in Africa. The DAI aims to assist policymakers in identifying areas for improvement to accelerate digital transformation.
Speaking during the launch of Kenya Digitalization Report by GSMA in Nairobi, the Ministry of ICT and the Digital Economy Cabinet Secretary (CS), Dr Margaret Nyambura Ndung’u appreciated the innovation in the mobile industry as a significant promoter of financial inclusion, especially for the unbanked population.
Kenya’s success is attributed to its progressive policies and regulations, which have fostered a conducive environment for mobile broadband adoption and innovation.
The report dubbed, “Driving Digital Transformation of the Economy in Kenya,” forecasts that the country’s digital economy will contribute $5.13 billion (Ksh662 billion) to GDP by 2028.
This growth is driven by strategic policy reforms and the accelerated adoption of digital technologies in sectors such as agriculture, manufacturing, transport, and trade.
In addition to economic growth, the report predicts the creation of 300,000 new jobs and an increase in tax revenues by $1.16 billion (KSH 150 billion).
The report further states that Kenya has also solidified its position as a leader in mobile financial services and digital innovation.
“In 2023, the mobile ecosystem contributed Ksh1.2 trillion to Kenya’s GDP and Ksh212 billion in government revenues.”
Additionally, the Kenyan government is said to recognize the importance of digitalization as a cornerstone of its economic strategy. The Kenya Vision 2030 and the Bottom-Up Economic Transformation Agenda (BETA) prioritize the integration of digital technologies into key sectors to drive growth.
The GSMA’s study emphasizes the economic benefits of expanding digital adoption and provides a roadmap for maximizing these gains through targeted policy actions.
By focusing on digitalization, Kenya aims to sustain its economic momentum, diversify the economy, boost productivity, and create high-quality jobs, especially for young and rural populations.
“The mobile telecoms sector plays a key role in supporting the process of digitalization and the Kenya Kwanza manifesto, specifically the Digital Superhighway pillar. Our research report has been developed in consultation with the Ministry of Information, Communication and the Digital Economy, the telecoms industry & stakeholders across the digital ecosystem,” noted Angie Wamola, the Head of Sub Saharan Africa at GSMA.
The report highlights the transformative potential of digitalization in key sectors that account for 58% of Kenya’s GDP. The adoption of digital technologies across agriculture, manufacturing, transport, and trade is expected to significantly contribute to economic growth, job creation, and tax revenues.
While Kenya has made significant progress, the GSMA notes that significant gaps remain.
According to the Chief Regulatory Officer, GSMA, John Giusti, one of the major challenges of mobile phone penetration in Sub-Saharan Africa is the unaffordability of smart phones.
To address these challenges, the report recommends bold policy initiatives to stimulate demand, reduce supply costs, and encourage investments in mobile money services, telecom infrastructure, and digital services.
