Sponsored Content


Budget speech 2020: using technology to solve critical issues

South african currency coins closeup picture

The forthcoming budget speech will serve as a telling indication of how the government plans to position South Africa as a player in the Fourth Industrial Revolution (4IR). While President Ramaphosa has said that he wants to attract investments in terms of the 4IR, it will be interesting to see how government intends to go about this, and how much of the budget is allocated to this stated priority.

International approaches to consider

Having decided a few years back that they wanted to invest heavily in blockchain, Singapore offered big incentives to companies looking to set up innovation and digital hubs within the country. As a result, they have gained access to some of the latest technology available, thus gaining a competitive advantage in the 4IR.

Within an African context, Angola is taking a similar approach and looking at offering incentives to companies involved in research and development, especially with regard to technology.

And in 2017, the UAE appointed their first State Minister for Artificial Intelligence, tasked with investigating how to integrate artificial intelligence (AI) into all aspects of society and the economy, from transport and healthcare to immigration and tax collection.

These are all examples that South Africa could draw on with a view to furthering our own technological development.

Leapfrogging ahead

One of the challenges we face as a country – indeed, as a continent – is that we are desperately playing catch-up in the development of infrastructure.

However, this ostensible disadvantage also presents us with certain opportunities. We need not be bound by legacy but have the freedom to put innovative solutions into place right from the start – for example, by investing in solar power and other alternative energies, which will be more renewable and sustainable, rather than building coal-fired plants. Or, rather than rolling out fibre across the suburbs to improve internet access – as SA is currently doing – we could look towards establishing satellite stations to provide connectivity to the entire country, without having to roll out expensive infrastructure on the ground.

In short, the decision that confronts SA is: do we invest in following in the footsteps of the rest of the industrial world, or do we take a bolder approach and invest in innovation and digital technology to leapfrog what might now be redundant steps in our current development plans?

Addressing the basics

What we’re seeing in the markets suggests that AI, digitisation and other technological innovation offer a means to solve critical issues economically and more effectively – from the provision of clean water and energy to healthcare, defence, roads, traffic management and beyond.

Here’s an example: in the healthcare space, the development of “vein finders” has enabled medical professionals to easily locate veins, thereby eliminating wastage, reducing stress and pain in patients, and saving time, which can mean the difference between life and death when treating trauma patients. The technology to do this is now available as an app for download, whereas previously it required hugely expensive and immobile sonar equipment, only usable within hospitals.

Given that we have a high level of smartphone penetration in SA, could we not develop other such healthcare solutions, to facilitate the provision of free basic healthcare to patients – even in rural areas?

Similarly, with regard to healthcare, current thinking is to build clinics and hospitals to increase population penetration. It no longer makes sense to invest these amounts in physical structures, as opposed to say, investing in applications that provide healthcare to the masses through digital technologies and AI (eg the Veinfinder app).

When it comes to service delivery across the country, integrating technology offers a means of reducing the potential for fraud and mismanagement, thus holding out the possibility of improved delivery and less money lost to corruption.

And within the education sector, investing in extending and upgrading internet connectivity and increasing students’ access to education via digital platforms, presents a means of providing education widely and more cheaply.

In short, innovation and technology can be used to find cheaper, more effective solutions to most problems, and those solutions may well be exportable to other countries. However, we need a forward-thinking approach from government to enable an environment that is conducive to developing and implementing such solutions.

Step up or lose out

Given that South Africa has many pressing issues, emphasising investment in innovation and technology may appear to be a case of putting the cart before the horse. On the contrary, I believe that it may be a more effective way to tackle exactly these issues.

If South Africa does not take the right steps in terms of getting the right levels of investment and offering incentives and tax breaks to companies investigating and developing new technologies, we will lose our best people within the digitisation space – which from all perspectives, is currently a purely global market –  to other countries. Eventually, we will end up buying these same skills and services back, presumably at great cost.

At the same time, investing in technological development is necessary in order to keep SA relevant over the long term. Around the world, the vast majority of all patents relating to AI have been issued either from the US or China, fuelling talk of an “AI war”. Many believe that the country that wins that war will ultimately control the world. We fail to remain relevant at our peril.

Government, therefore, needs to be forward-thinking in the way they use public funds with regard to technological development, and this requires a long-term plan. South Africa is at a crossroads, and it all comes down to leadership: Do we have a government that leads us down the beaten path, or do we have a bold government that embraces the technological age? Only time – and the forthcoming budget speech – will tell. DM

This article was written by Nevellan Moodley, Head of Financial Services Technology, BDO South Africa



Please peer review 3 community comments before your comment can be posted