The technologies of the 4IR will increasingly blur the lines between the physical and the digital and exponentially increase the speed and efficiency with which we engage in the production and consumption of goods and services.
The Fourth Industrial Revolution (4IR) is the new catchphrase for policymakers around the world and promises to become the new engine for economic growth. The developing and underdeveloped world may in particular see the 4IR as an opportunity to leapfrog through the stages of economic development, and the region with perhaps the greatest potential for doing so is Sub-Saharan Africa (SSA). Yet without a forward-thinking strategy adapted to the peculiarities of their own economic context, these countries may find themselves falling further and further behind in the development curve.
The technologies of the 4IR — AI, robotics, biotechnology etc. — will increasingly blur the lines between the physical and the digital and exponentially increase the speed and efficiency with which we engage in the production and consumption of goods and services. Automation alone will add between 0.8% to 1.4% to annual global GDP growth, and AI could drive global GDP 14% higher by 2030 over 2017 figures.
With this promise comes also the potential for disruption. If the world’s leading manufacturing powers do not modernise their production processes and technologies, they risk falling behind. Thus the urgency in China, Japan, South Korea, Germany and others, reflected in the release of comprehensive 4IR strategy documents, to innovate and anticipate the impact of these technologies on society and the future of work. Countries with large and growing industrial bases (India, Philippines, UAE among others), if they can rapidly capitalise on emerging technologies, could use this opportunity to leapfrog their way up the leaderboard.
Yet perhaps the category of countries that have the greatest opportunity in front of them are the least-developed countries (LDCs) which have been “left behind by globalisation”. The core requirements for the 4IR are data, skilled human capital, an enabling environment and connectivity. SSA has many of the raw materials for the revolution but has yet to realise the full potential of these resources.
SSA has three major strengths it can capitalise on to jump into the 4IR: human capital, an untapped market for innovative applications and the absence of legacy industrial systems.
| Country | Manufacturing as % of GDP | % Population employed in manufacturing |
| Ethiopia | 4.5 | 14 |
| Ghana | 5.3 | 10.7 |
| Nigeria | 10.3 | 11 |
| Tanzania | 6.9 | 3 |
| Uganda | 8.7 | 4.4 |
| Zambia | 7.6 | 4.1 |
Source: WEF Future of Production Readiness Report (2018)
The upside of this economic structure is that most of these countries have the potential to leapfrog to advanced manufacturing and services, with little to no resistance from entrenched, outdated manufacturing structures. Realising the potential for manufacturing in Africa, there is no dearth of foreign investors willing to pour in resources to build up this sector: between 2000 and 2013, FDI flows into SSA increased six-fold to $45 billion and shows a shift from extractive sectors to manufacturing.
Fully-automated manufacturing may not be in the interest of all countries in this region, especially those with massive projected growth in the working age population, however 4IR technologies could instead be deployed for logistics management, accounting and other functions that augment but not completely replace human beings in the sector.
The factors highlighted above constitute pillars upon which 4IR can be built, but the countries of SSA must work to build the platform itself, namely through investment in critical infrastructure such as transportation, healthcare and efficient, accountable governance.
However, the region has also seen an influx of infrastructure investment from partners like China, Japan and India who see the region as an engine for their continued growth. Nigeria, for instance, is one of the largest recipients of Chinese investment in Africa, most of which has been concentrated on energy, and increasingly, transport.
However, a major barrier for foreign investors has been corruption.
Although investments may continue to flow in in the short-term, the shift in global energy trends will gradually make the risk posed to investors by corruption untenable. Given that a large portion of SSA’s exports and inward flows of FDI are still linked to extractive industries such as coal, natural gas and oil, the governments of SSA will need to greatly improve the ease of doing business in their countries in order to continue to receive much-needed FDI.
The 4IR is SSA’s opportunity to finally close the gap with its more developed counterparts. However, to do so countries must rapidly move toward an enabling ecosystem, including adequate infrastructure and efficient bureaucracy, that can also adequately support their population in making the leap to new forms of employment. Timely action is crucial to ensure the region leads rather than lags behind in the new industrial revolution.
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Trisha Ray is an associate director and resident fellow at the Atlantic Council’s GeoTech Center. Her research interests lie in geopolitical and security trends in ...
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