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Opinionista

Every cent invested in ICT will pay off in growth and jobs

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Mmusi Maimane is leader of Build One SA.

Connecting South Africans in villages, towns, cities and suburbs to the rest of the planet through high-speed broadband will stimulate entrepreneurship and growth like no other investment. It removes distance and offers everyone a chance to secure their own economic freedom. ICT certainly deserves more of our attention and budget than it is getting.

We all recognise the importance of infrastructure investment for economic growth. Infrastructure projects develop communities, create jobs and contribute substantial taxes. The government’s National Development Plan calls for it to spend 10% of our gross domestic product (GDP) on infrastructure projects. Unfortunately we’re nowhere near that percentage yet.

Most of our infrastructure budget goes towards roads, transport, electricity, water and sanitation, as these are considered the critical areas for economic growth. But there is one area of infrastructure investment that has the potential to drive economic growth like no other, and it is an area in which we are still greatly underspending.

Of course, I’m talking about investment in information and communications technology (ICT).

Our national ICT plan, dubbed SA Connect, has set lofty goals of connecting 90% of South Africans at a minimum speed of 5 Mbps by 2020, with 50% of the population at 100 Mbps. It further aims to give every South African broadband access at a cost of less than 2.5% of the average monthly income.

As things currently stand, there are a number of reasons why this won’t happen, the main one being an inadequate budget. But before I get into what we can do to increase broadband penetration across South Africa, I’d like to briefly explain why ICT infrastructure is so important for an economy like ours that is stuck in a low-growth cycle and is not creating jobs.

In 2012, the World Bank calculated that a 10% increase in fixed broadband penetration in developing countries would result in a 1.35% increase in GDP growth. A more recent study found that doubling mobile data usage leads to a 0.5% increase in GDP growth. As ICT infrastructure has spread through the developing world and contributed to economic growth, these regions have seen a steady decline in absolute poverty. The global extreme poverty rate – individuals who survive on less than $1.30 a day – dropped from 1.9-billion people in 1981 to 1.3-billion in 2012.

Broadband access contributes to innovation in the development of products and services. It makes countries and regions globally competitive. It improves the way in which governments can interact with citizens. It offers people an easy, low-cost entry point into the economy. It serves as a magnet for talent as smart, innovative people gravitate towards places with good ICT infrastructure. It helps to level the education playing field and it brings cheap and potentially life-saving technology to hospitals and clinics.

In short, connecting South Africans in villages, towns, cities and suburbs to the rest of the planet through high-speed broadband will stimulate entrepreneurship and growth like no other investment. It removes distance and offers everyone a chance to secure their own economic freedom. It certainly deserves more of our attention and budget than it is getting.

The Department of Telecommunications and Postal Services – the custodian of the SA Connect project – has allocated a total ICT budget of R740-million over three years. Considering the ambitious scope of the project, this is woefully inadequate.

But it’s not only the budget allocation that’s inadequate. We urgently need the government to commit to its own broadband policy, which recommends government/private sector collaboration in a broadband network of shared infrastructure. There’s no sign of this happening. We need Telecommunications and Postal Services Minister Siyabonga Cwele to meet with the Broadband Advisory Council – something he has not done once since taking up his portfolio.

But most importantly, we need to complete our migration to digital TV. This project was meant to have been finalised in June this year, and we’re nowhere near ready to make the switch yet (with completion dates likely to run up to three years late). This migration is crucial for our ICT development because switching to digital broadcast will free up the airwaves needed for wireless broadband and radically lower costs. And it is the rural and under-serviced areas that will really be affected.

As stated in the government’s ICT plan, it is important to remember that broadband roll-out cannot be a national government project – it’s all about partnerships. Partnerships between municipalities, provincial governments and national government, and partnerships between the state and the private sector. When this is done right, you get the best coverage at the best cost with the least amount of wasteful duplication.

In the Democratic Alliance-run Western Cape and City of Cape Town, these partnerships are already paying dividends through a number of exciting ICT projects.

One such project is the ICT business incubator and accelerator Bandwidth Barn, which can now be found in Woodstock and Khayelitsha. These are essentially hubs where innovative “techies” can get their projects started – where they can take advantage of subsidised office space, work in a networked environment, use meeting rooms and make use of training to help make a success of their ventures.

Another exciting ICT project – this time a partnership between the city and the province – is the ICAN Centre which is due to open in Cape Town’s Elsies River next month. ICAN stands for Interactive Community Access Network and these centres, of which Elsies River is the pilot project, will offer Wi-Fi, meeting rooms, training rooms and even video booths where users can film their own YouTube clips.

The city and the province’s project of linking government buildings with fibre-optic cable is also well under way and will see all schools, hospitals and clinics connected to high-speed broadband. The benefits to areas like e-learning or the instant sharing of medical information cannot be overstated.

Similarly, the Western Cape provincial government has started rolling out a project that will see Wi-Fi hotspots established in every single ward in the province, and they’re on track to reach their target of 50 wards by the end of the year. This will see public spaces like taxi ranks, schools and community halls become free Wi-Fi zones, effectively creating hundreds of new learning and job centres.

The Western Cape is leading the digital charge in South Africa, but if we are to establish ourselves as Africa’s technology hub, we urgently need the other provinces to come on board too. And we can’t afford to waste time, as this is a very competitive global space. Our big competitor in this area on the continent is Kenya, and it has made its intention to become Africa’s leading tech nation very clear.

Our country is brimming with innovative, talented individuals. But if you really want to see just how talented and innovative they can be, then offer them the opportunity to connect with the rest of the world. DM

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