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GSMA Report Reveals Mobile Is Catalyst For Explosive Growth In Sub-Saharan Africa

- Region Leads World in Mobile Growth, Mobile Internet and Mobile Money Transfer, But Further Growth Is Held Back by Inadequate Spectrum Allocation and High Taxation

CAPE TOWN, South Africa, Nov. 13, 2012 /PRNewswire/ -- The GSMA today revealed that sub-Saharan Africa is the fastest-growing mobile market in the world, with a prodigious average annual growth rate of 44 per cent since 2000(1). Mobile connections have leapt to 475 million, compared to just 12.3 million fixed line connections, representing the highest proportion of mobile versus fixed line connections in the world. With necessary spectrum allocations and transparent regulation, the mobile industry could fuel the growth of 14.9 million new jobs in sub-Saharan Africa between 2015 and 2020. Based on research from Deloitte, the GSMA sub-Saharan Africa Mobile Observatory(2) provides a comprehensive evaluation of the region's mobile industry and its socio-economic impact.

"Mobile has already revolutionised African society and yet demand still continues to grow by almost 50 per cent a year," said Tom Phillips, Chief Government and Regulatory Affairs Officer, GSMA. "To create an environment that supports and encourages this immense growth, it is imperative that governments work in partnership with mobile operators to enable the industry to thrive throughout the region, ultimately providing affordable options to connect its citizens."

The region has some of the highest levels of mobile internet usage globally. In Zimbabwe and Nigeria, mobile accounts for over half of all web traffic at 58.1 per cent and 57.9 per cent respectively, compared to a 10 per cent global average. 3G penetration levels are forecast to grow by 46 per cent through 2016 as the use of mobile-specific services develops.

Economic Impact of Mobile

The rapid pace of mobile adoption has delivered huge economic benefits for the region, directly contributing US$ 32 billion to the sub-Saharan African economy, or 4.4 per cent of GDP. Approximately 3.5 million full-time jobs are attributed to the mobile industry, which has also spurred a wave of technology and content innovation. More than 50 'innovation hubs', which develop local skills and content in the field of ICT services, have been created, including the Hive Colab in Uganda, the iHub in Kenya, and Limbe Labs in Cameroon. Safaricom's M-PESA mobile money transfer service in Kenya has achieved greater scale than any other service in the world. Today, there are more than 80 mobile money operations for the unbanked across Africa compared to 36 in Asia, the second most popular region for these services.

Spectrum 'Crunch' Threatens Region

Despite investments of US$ 16.5 billion over the past five years (US$ 2.8 billion in 2011 alone) across the five key markets in the region(4), mainly directed towards the expansion of network capacity, sub-Saharan Africa faces a looming 'capacity and coverage crunch' in terms of available mobile spectrum.   

The current amount of spectrum allocated to mobile services in sub-Saharan Africa is amongst the lowest worldwide. Some countries apportion as little as 80MHz, compared to developed markets where allocation for mobile exceeds 500MHz. With mobile Internet traffic forecast to grow 25-fold over the next four years, there will be a considerable increase in network congestion unless governments across the region take urgent steps to release new spectrum in line with the recommendations of the ITU's World Radiocommunication Conference (WRC). This includes capacity in the Digital Dividend (700-800 MHz) band and the 2.6 GHz band, and also liberalising existing licence agreements to allow the deployment of high-speed UMTS and LTE networks in the 900 and 1800MHz bands. 

The combined aggregated effect of the spectrum release of the Digital Dividend, 2.6GHz and the refarming of 1800MHz would have a positive impact on job creation: an additional 14.9 million jobs could be created between 2015 and 2020 in the key six markets in the region(3). Mobile industry growth could also generate a GDP increase of US$ 40 billion, representing 0.54 per cent of total GDP, in the region by 2016. Meanwhile, failure to harmonise spectrum allocations in the region could add up to US$ 9.30 in handset costs for African consumers.

Chris Williams, Deloitte telecommunications partner, comments: "In many sub-Saharan African countries, mobile broadband is the only possible route to deliver the Internet to consumers. However, to maximise the potential gains, governments need to continue to support the development of mobile broadband, notably through the provision of appropriate spectrum. The current spectrum allocations across the region lag behind those of developed countries and, unless increased, seem likely to raise costs of provision, challenge investment decisions and increase network congestion."

Taxation and Regulation Could Stifle Further Growth

High levels of government taxation and new regulation also threaten to limit the growth of mobile services across the region. Africa has the highest taxation, as a proportion of the cost of mobile ownership, amongst any developing regions worldwide, with taxes on handset and mobile devices much higher than elsewhere. There is also a worrying trend of new taxes being introduced on essential mobile services; for instance, the Kenyan government recently announced a new 10 per cent tax on money transfer services, threatening the economic viability of the service in the future.

Meanwhile, approvals for tower and fibre deployment have been identified as the single biggest obstacle to investment by the mobile community in sub-Saharan Africa. As capacity increases and such deployments are urgently required to cope with substantial traffic growth, complex and uncoordinated national and local regulations and approval processes, especially with regards to rights of way, could be simplified to aid this process.

Phillips continued: "Tackling stifling regulation, addressing high taxation and implementing a harmonised approach to future spectrum allocation will further boost the success story of mobile across the continent. There is not only the potential to lift millions out of poverty, but also the opportunity to ensure that Africa benefits from global economies of scale in terms of both network technology and mobile devices."

To view the full report, please follow this link:

Notes to Editors

(1) Source: Wireless Intelligence 2012: Growth is measured as Compounded Annual Growth Rate (CAGR) for 2000-2012.  This compares to an average of 34 per cent for developing regions and 10 per cent for developed regions as a whole.  Country classifications are based on the World Bank group definitions.

(2) This is the second African edition in the GSMA Mobile Observatory series, prepared by Deloitte for the GSMA, and the first with a focus on the sub-Saharan Africa region.  This Observatory provides the latest statistics and market developments, and a reference point for participants in the mobile industry, policy makers and other interested stakeholders. It covers the state of the industry, including the evolution of competition, innovation in new products, services and technologies and the industry's contribution to social and economic development across the region.

(3) Mobile sector's contribution to employment and GDP across key sub-Saharan Africa countries with release of additional spectrum (2015–2020)





South Africa


Additional jobs (million)







Additional GDP (US$ m)







(4) Nigeria, Tanzania, South Africa, Kenya and Ghana

About the GSMA

The GSMA represents the interests of mobile operators worldwide. Spanning more than 220 countries, the GSMA unites nearly 800 of the world's mobile operators with more than 230 companies in the broader mobile ecosystem, including handset makers, software companies, equipment providers and Internet companies, as well as organisations in industry sectors such as financial services, healthcare, media, transport and utilities. The GSMA also produces industry-leading events such as the Mobile World Congress and Mobile Asia Expo. 

For more information, please visit the GSMA corporate website at or Mobile World Live, the online portal for the mobile communications industry, at

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