Young voices from Africa – Harnessing digital tools for sustainable trade

Knowledge Graph of Debate

Session report

Audience

The analysis highlights several arguments and discussions on various topics. One of the main points revolves around India’s ability to offer efficient solutions in language, digitalization, and financing that could greatly benefit the World Trade Organization (WTO). India has already introduced and pilot-tested an MSME financing solution called Oconfor and has initiated the United Payment Interface (UPI) for mobile transfers of money with low transaction fees. These initiatives demonstrate India’s potential in addressing issues related to language barriers, digitalization, and financing, making it an asset to the WTO.

Ghana is another country making strides in promoting inclusivity and gender equality in trade. The country has implemented several strategies to support women in benefiting from the African continental free trade. This includes the formation of the Trade and Gender Committee under the National Trade Facilitation Committee, sensitization and training programs for women and border agencies, the adoption of the ‘gender champion’ concept to assist women traders effectively, and the implementation of a simplified trade regime for women crossing the border with goods worth less than $5,000. These initiatives demonstrate Ghana’s commitment to ensuring women are empowered and can actively participate in trade, contributing to the overall economic growth of the country.

Digital inclusion and access to digital financial tools are crucial for remote work and business efforts, particularly in rural areas. Limited access to essential digital tools, such as credit cards, hinders individuals from fully participating in the digital economy. There is a need for solutions to eliminate these barriers and ensure individuals from rural areas have access to digital financial tools. This will not only facilitate remote work opportunities but also contribute to reducing inequalities and promoting decent work and economic growth.

The analysis also explores the issue of youth representation in politics. It is observed that there is a lack of young people’s representation, and their voices are not being adequately heard. To address this, the suggestion is made that young people should create their own platforms to amplify their voices and be noticed in political arenas. This would contribute to building stronger institutions and promoting peace, justice, and inclusivity.

Financial inclusivity is another important aspect discussed in the analysis. The integration of mobile payment solutions with traditional banking methods is seen as essential to ensure financial inclusivity. Many individuals, especially youth, use mobile payments extensively. However, access to Visa cards, which are often required for certain transactions, can be a challenge and may restrict financial participation. The need for integration between mobile payment solutions and traditional banking methods is thus emphasized to promote financial inclusivity, reduce inequalities, and tackle poverty.

The analysis also points out the importance of policies adapting to technological advancements. While technology is advancing rapidly, policies often lag behind. There is a need for policies that can keep up with these developments to ensure organizations can effectively utilize successful models and data, thereby enhancing sustainability and contributing to responsible consumption and production.

Finally, the analysis sheds light on the issue of allowing Africans to pay in local currency for digital services. Currently, the e-commerce moratorium exempts tax on digitally delivered services. However, there are concerns that this moratorium may be under threat, which could have detrimental effects, particularly in Africa. It is argued that platforms like GAFA should work with local partners to enable Africans to pay directly in local currency, rather than relying on hard currencies or mobile visa payments.

In conclusion, the analysis highlights various arguments and discussions on a range of topics. It emphasizes the potential benefits that India and Ghana can bring to the WTO, the importance of digital inclusion and financial access, the need for improved youth representation in politics, the significance of financial inclusivity and technological adaptation in policies, and the challenges associated with digital payments in African countries. These insights provide valuable considerations for policymakers and stakeholders to address these issues and promote sustainable development.

Sarah Frimpong

The analysis reveals several important points about the informal sector and the role of women in African economies. Firstly, it highlights the distinctive dual nature of African economies, divided into the formal and the informal sector. The informal sector is found to make a significant contribution to Africa’s Gross Domestic Product (GDP). Notably, women and youth form the largest part of the informal sector in Africa, underscoring their importance in this sector.

However, challenges are facing the African informal sector that need to be addressed. One of these challenges is the complexity of digital platforms, which proves to be a barrier for some players in the informal sector who lack literacy skills to make good use of mobile money payments. As a result, most market women can only use their phones to make calls due to low literacy levels. This highlights the need for simple solutions that can enable market women to fully utilize digital platforms and expand their businesses.

Another challenge identified is the issue of affordability in telecommunication products and services in Africa. It is noted that making a call from Ghana to Togo is more expensive than making a call from Europe to Germany. This lack of affordability hinders market women from taking full advantage of their limited knowledge and expertise. Therefore, it is crucial to address this issue by providing affordable telecommunication products and services that can empower market women and facilitate their participation in economic activities.

The analysis also emphasizes the importance of involving and informing informal traders about the African Continental Free Trade Area. It is highlighted that most market women are unaware of this trade agreement, and the lack of information and complex language of trade agreements hinder their effective implementation. Therefore, there is a need to translate trade agreements into easily understandable language for market women to ensure their meaningful participation in the economic benefits of the African Continental Free Trade Area.

Furthermore, the analysis criticizes the government’s hasty approach to formalizing the informal sector through counterproductive interventions. Specifically, the introduction of a 1.5% tax on withdrawals in Ghana resulted in a 20% drop in mobile money transactions. Instead of imposing burdensome taxes, the government is urged to adopt a collaborative approach that enables a seamless transition of the informal sector into the formal economy.

The lack of comprehensive understanding and data collection on the informal sector is identified as a major hindrance to effective policy interventions. The analysis argues that the informal sector is intricate, with different needs, skills, and capacities. Current initiatives and interventions tend to broadly categorize the entire informal sector and may not address the unique needs of its different aspects. Additionally, the scarcity of data on the informal sector makes it challenging to design appropriate policies that can effectively support this sector.

To address this issue, the analysis suggests increasing and improving data collection on the informal sector in Africa. The availability of more data would allow for a more comprehensive understanding of the various intricacies of the informal sector and would aid in the formulation of targeted and effective policy interventions.

Lastly, the analysis highlights the importance of renewing the moratorium in trade, particularly in the interest of women. Renewing the moratorium is seen as a cost-effective way to include women in trade, with minimal costs compared to the potential gains that would be made by including women in the trade sector. However, the analysis does not provide supporting arguments or evidence for this point.

In conclusion, the analysis sheds light on key aspects of the informal sector in African economies and the crucial role of women in this sector. It underlines the need for simpler digital platforms, affordable telecommunication products and services, and informed participation in trade agreements to unlock the potential of the informal sector. Additionally, the analysis emphasizes the importance of a collaborative approach, comprehensive data collection, and renewing the moratorium in trade to foster inclusive and sustainable economic growth in Africa.

Princess Puskas

Mobile payments have the potential to revolutionize the financial landscape in Africa by including previously unbanked populations and contributing to sustainable economic growth. Around 70% of mobile money accounts in 2022 were from Africa, highlighting the significant uptake of mobile payments in the region. By bringing the unbanked and informal sectors into the financial sector, these individuals can actively participate in the economy and contribute to economic growth.

Mobile payments also hold great promise for the development of micro, small, and medium enterprises (MSMEs) in Africa. These businesses, often lacking access to traditional banking services, can benefit from mobile payment platforms that enable efficient and secure transactions. This support for MSMEs can foster entrepreneurship, job creation, and economic development.

To ensure the inclusion of the informal sector in the internationalized mobile banking system, digital literacy becomes a crucial factor. Initiatives are proposed to progressively incorporate the informal sector into banking through enhanced digital literacy programs. This approach aims to empower individuals in the informal sector to navigate and utilize mobile banking solutions effectively.

The process of internationalizing mobile banking should begin with a small-scale approach, initially focusing on the leading languages in Africa. Gradually, other languages should be included to ensure accessibility and a universal banking system that facilitates transactions and exchanges of goods and services across the continent.

The inclusion of digital technologies in Africa’s economy can help lower reliance on the informal sector, which is associated with high unemployment rates and limited economic diversification. The adoption and integration of digital technologies can drive innovation, enhance productivity, and contribute to a more diverse and sustainable economy.

Regulation and supervision of digital technologies are important for fostering innovation, safeguarding financial stability, and protecting consumers. A balanced approach is necessary to create an enabling environment that supports technological advancements while ensuring compliance with regulatory standards.

Efforts towards achieving a single digital market in Africa are commendable, particularly through collaboration among African economies. The establishment of such a market holds tremendous potential for promoting digital innovation, boosting trade, and enhancing economic growth across the continent.

Mobile payment services, such as Orange Money, offer their own Visa Card, providing youths with access to financial services without requiring a traditional bank account. This inclusion of youths in the financial sector is crucial, as they hold valuable insights and perspectives that can drive innovation and bridge potential generational gaps.

The commendable efforts made in India and Ghana towards boosting inter-country trade through the adoption of digital technologies are noteworthy. India’s United Payment Interface has been instrumental in lowering transaction costs, while Ghana’s partnership with the Pan-African Payment Settlement System has facilitated cross-border trade. These examples demonstrate the transformative potential of digital technologies in fostering economic cooperation and integration.

Furthermore, when discussing digital technology and youth, it is important to ensure gender balance in the conversation. While women are often the focus of gender equality efforts, it is equally important to include male youth in discussions to ensure a comprehensive understanding and address the needs of all genders.

In conclusion, mobile payments, digital literacy, inclusive internationalisation of mobile banking, digital technology inclusion, regulatory balance, collaboration, youth involvement, inter-country trade facilitation, and gender equality are crucial elements for driving sustainable economic growth and financial inclusion in Africa. Through concerted efforts and strategic initiatives, Africa can harness the transformative power of digital technologies and leverage them to forge a prosperous and inclusive future.

Cecilia Malmström

Trade liberalization has a differential impact on men and women, with gender discrimination in laws making it more difficult for women to access financing. Women’s clothes are also subject to higher tariffs compared to men’s clothes. To address these challenges and promote gender equality in trade, it is crucial to involve women in trade more systematically and remove obstacles to their participation. Research has shown that countries with higher participation of women entrepreneurs are more competitive.

Gender provisions should be included in free trade agreements to ensure gender equality in trade. The European Union (EU) has taken steps in this direction by including gender provisions in their agreements with Canada and New Zealand. Additionally, 125 countries signed a joint declaration on women in trade at the Ministerial 2017 in Buenos Aires, showing a global commitment to addressing gender inequalities in international trade.

The African Continental Free Trade Agreement has immense potential for empowering women by improving their financial and digital literacy, increasing their access to capital and opportunities. Inclusion and participation of women are crucial components of the agreement to ensure that women benefit from the trade opportunities it provides.

Better data on the informal sector is needed to design effective interventions and policies. Collecting data can help understand the unique challenges faced by women in the informal sector and implement targeted solutions.

The needs of the informal sector include digitalization, training, access to capital, and the removal of discriminatory rules. Addressing these needs can enhance opportunities for women in the informal sector, leading to improved livelihoods and economic growth.

Standardization in e-commerce, anonymization in public procurement, and high-standard digital trade rules are essential for promoting gender equality and reducing discrimination. Standardization facilitates fair and efficient business transactions in e-commerce. Anonymization in public procurement projects can mitigate discrimination and increase the number of projects that go to women. High-standard digital trade rules ensure inclusivity and enable women and micro, small, and medium-sized enterprises (MSMEs) to benefit from digitalization.

During the COVID-19 pandemic, the importance of digital trade and services has increased. High-standard digital trade and services rules can ensure that women and MSMEs receive the benefits of digitalization. Enhancing digital services trade within the African continent requires sharing best practices and experiences.

Measures related to digital services and market access are crucial for building trust. Implementing high-standard provisions and providing access to cybersecurity and fraud prevention tools are essential for fostering trust in digital transactions and promoting business growth.

Mobile payments play a transformative role in reducing inequalities, particularly in the African context. Encouraging diverse solutions and services can create an enabling environment for women and promote financial inclusion.

Including women’s rights in trade agreements is a vital step towards gender equality and decent work. Most modern trade agreements reference the International Labour Organization (ILO) core conventions, which protect women’s right to unionize and advocate for non-discriminatory wage negotiations. Examples include trade agreements between the EU and various countries, as well as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

Individual companies must take action to implement ILO conventions and promote gender equality and decent work. While enforcement lies with the companies, support from organizations like the EU and the ILO is essential for monitoring and addressing systematic abuses.

In conclusion, trade has a significant impact on gender equality, and it is crucial to address the differential effects of trade liberalization on men and women. By involving women in trade, removing obstacles, and improving access to markets and resources, countries can enhance competitiveness and promote gender equality. Including gender provisions in trade agreements, such as those by the EU, contributes to gender equality in international trade. The African Continental Free Trade Agreement empowers women by addressing their specific needs and promoting standardization and high-standard digital trade rules. Collecting better data on the informal sector informs effective interventions, and addressing the needs of the informal sector, such as digitalization and access to capital, benefits women. Standardization in e-commerce, anonymization in public procurement, and high-standard digital trade rules reduce discrimination and promote inclusion. Mobile payments promote financial inclusion and reduce inequalities. Finally, including women’s rights in trade agreements and implementing ILO conventions are vital for promoting gender equality and decent work.

Cathleen McDonalds

Visa’s presence in Africa and its approach to the continent’s demographics and technological innovation have been viewed positively. They operate in over 200 countries, including various African countries, and their aim is to facilitate access for women, entrepreneurs, and MSMEs into the global economy. This aligns with the goals of SDG 5 (Gender Equality), SDG 8 (Decent Work and Economic Growth), and SDG 10 (Reduced Inequalities). Visa recognized the opportunities in Africa’s demographics and technological advancements.

During the pandemic, Visa’s Think Tank discovered a surge in women’s entrepreneurship, driven by the acceleration of digitization. Businesses that experienced growth during this period were more likely to use digital platforms and payments, as well as engage in export. This highlights the positive impact of digital payments on women’s empowerment and economic growth, in line with SDG 5 and SDG 8.

Visa’s initiatives in Africa further demonstrate their commitment to promoting economic growth and innovation. They have partnered with Safaricom in Kenya to extend the use of M-PESA, a mobile money transfer service, beyond Kenya’s borders. Additionally, Visa has launched the Visa Africa Fintech Accelerator, aimed at supporting local startups and fintechs. They are also working on ensuring interoperability of different payment models across Africa. These efforts contribute to the goals of SDG 8 and SDG 9 (Industry, Innovation, and Infrastructure).

The relevance of digital technology in promoting financial inclusion and economic growth is underscored by Cathleen McDonald. She emphasizes the potential of digital technology to act as a catalyst for these goals. Additionally, McDonald highlights the importance of disseminating information about digital technologies in an accessible and inclusive manner. Utilizing appropriate channels such as radio stations and newspapers, especially for people in rural areas, can enhance inclusion, aligning with SDG 9 and SDG 10.

McDonald also upholds the importance of language in information sharing, suggesting that utilizing local languages can improve the rate and efficacy of inclusion. Trade affairs and educational forums are suggested as platforms for teaching about opportunities for financial and economic advancement through digital technologies. These platforms align with the goals of SDG 4 (Quality Education), SDG 8, and SDG 9.

However, McDonald acknowledges technical issues experienced with Visa mobile payments, indicating the need for further improvement in this area.

The initiatives of India and Ghana in promoting digital financial inclusion are praised. India focused on digital public infrastructure during its G20 host year, while Ghana is working on direct interventions to facilitate digital financial inclusion. These efforts contribute to the goals of SDG 9 and SDG 10.

McDonald commends young African trade experts for their focus on youth, particularly the inclusion of young women. Their efforts align with SDG 5 and SDG 8.

Access to more digitally enabled services is considered a net benefit for economies and diversification, with a particular positive impact on women and MSMEs. This aligns with SDG 1 (No Poverty), SDG 5, SDG 8, and SDG 10.

Extending the moratorium on certain digital tools and services is seen as crucial to maintaining the availability and offerings of these tools. Not extending the moratorium could have a negative effect, and the use of these digital tools is vital for achieving SDG 8, SDG 9, and SDG 10.

Visa’s Visa Net Settlement Service is offered in the African continent, providing services in local currency when domestic services are needed. This contributes to SDG 8 and SDG 10.

More competition in payments is viewed positively as it drives down costs, encourages investment in innovation and security, and provides more options for consumers and small businesses. This aligns with SDG 8, SDG 9, and SDG 10.

In conclusion, Visa’s presence and approach in Africa highlight their dedication to promoting gender equality, economic growth, and reduced inequalities. Their initiatives in partnership with local entities, support for startups and fintechs, and efforts towards interoperability are ways in which they are contributing to the achievement of the SDGs. Additionally, the positive impact of digital payments on women’s empowerment and the importance of inclusive information dissemination and language accessibility are emphasized. The initiatives of India and Ghana, as well as the commendation of young African trade experts, further highlight the significance of digital financial inclusion and youth focus.

Moderator

During the discussions, speakers explored various topics related to inclusive economic growth in African countries. One key focus was the potential of mobile payments to foster inclusivity, particularly for micro, small, and medium enterprises (MSMEs). It was acknowledged that bringing unbanked individuals into the financial sector through mobile payments could stimulate economic growth. The positive sentiment towards this argument suggests an optimistic outlook for the impact of mobile payments in Africa.

However, concerns were raised regarding digital literacy and language barriers that could hinder the implementation of mobile payment systems. It is crucial to address these issues to ensure that all individuals, including those with limited digital and language skills, can fully participate in the digital economy. This neutral sentiment highlights the need for further considerations and actions to overcome these barriers.

Another significant argument was the adoption of artificial intelligence (AI) to integrate the informal sector into banking services. The use of AI technology was seen as a potential solution to unify African banking and facilitate smoother exchange of goods and services. The positive sentiment towards this argument implies that AI integration can promote economic growth and inclusivity in the informal sector.

Digital technologies were also highlighted as means to empower women and graduates in starting their businesses. It was argued that digital tools and services can create more opportunities for underrepresented groups and contribute to gender equality and economic growth. This positive sentiment suggests that digital technologies have the potential to foster inclusive economic development.

Another point raised was the need for African economies to diversify in order to withstand tensions and pandemics. The sentiment towards this argument was neutral, indicating that while diversification is important, further actions and strategies are needed to promote diversification and enhance economic resilience in the region.

The importance of Visa as a global payments network working to uplift businesses and support women in Africa was also emphasized. The neutral sentiment towards this argument suggests a balanced view of Visa’s role and potential impact on economic growth and gender equality in the region.

Furthermore, the discussions emphasized the significance of digital inclusion, access to capital, and the removal of discriminatory rules and laws. It was argued that policy interventions are needed to sustainably maintain startups and enable their growth. These interventions also require the use of data to understand and implement effective policies in the informal sector. The positive sentiment towards these arguments indicates a recognition of the importance of supportive policies and data-driven decision-making in promoting inclusive economic growth.

In conclusion, the discussions revolved around various aspects of inclusive economic growth in African countries. The potential of mobile payments, adoption of AI, digital technologies, diversification, and policy interventions were among the key points discussed. The overall sentiment was positive, indicating an optimistic outlook for leveraging these approaches to foster sustainable economic development and reduce inequalities in the region.

Speakers