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[OPINION] Industry 4.0: Big opportunities, big risks for Africa

The theme for this year’s edition of the World Economic Forum (WEF) is “Globalisation 4.0: Shaping a Global Architecture in the Age of the Fourth Industrial Revolution”. Myself and a delegation of SA ministers will work with other global participants on defining new models for building sustainable and inclusive societies in a plurilateral world.

There is no question that the fourth industrial revolution is upon us. That it is taking place globally at unpredictably fast rates is common cause. The biggest unknown is the size of the seismic change ahead of us and its impact on the developing world, particularly the African continent.

The disruptions that digital technology will bring are expected across industries and all economic sectors, impacting the job market of the future, skills development and education of the workplace and not least, the way we live. For Africa, the fourth industrialisation poses massive opportunities, but also some critical risks.

Previous industrial revolutions heightened and increased regional divisions and marginalised the most vulnerable societies in the world. It is imperative that governments shape the current globalisation trends to ensure inclusivity and fairness of the fourth industrial revolution through collaboration and partnerships. Strong collaboration and consensus is required between government, academia, science councils, business and labour.

With Africa having the world’s youngest population, the most pertinent question to my mind is, “How does Africa, with the development and climate challenges it faces, take its place in a Globalisation 4.0 context?”

As Africa’s leading industrialised nation, SA has been preparing for the fourth industrial revolution for several years across various sectors of government. All industries are being digitally disrupted, which presents an opportunity for a growing digital economy. The fourth industrial revolution provides us with a new and unique opportunity to address youth unemployment by adapting our education models to catalyse innovation and upskill the next generation for digital transformation.

Through the Department of Trade and Industry’s industrial policy action plan (IPAP), the government has developed several iterations of industrial policy to support Africa’s industrialisation and optimisation of the fourth industrial revolution. The department recently established a new chief directorate, the future industrial production & technologies (FIP&T) unit, to examine likely impacts and build capacity around government to confront challenges of the fourth industrial revolution.

By importing Industry 4.0 technologies and combining them with low costs of production factors, emerging countries can leapfrog in the value chain and solve societal issues, including creating decent jobs.

Industries with wide product ranges (such as food and beverages), commodity producers (metals, agriculture) and precision-driven (pharmaceuticals and electronic components) are most likely to invest in Industry 4.0, which is crucial for the SA economy.

Early SA areas of response to date include aggressive technology acquisitions, transfer and diffusion of technologies; and securing inward investment from global original equipment manufacturers in key strategic value chains to build global competitive capabilities for instance mining and mining capital equipment; fuel cells; aerospace and defence. Knowledge and communications technology skills will be critical to Africa unlocking future opportunities.

As government, we have stepped up research and development and commercialisation efforts, led by the department of science and technology and its institutions, in close collaboration with the department of trade and industry.

We are providing a much stronger institutional architecture to support technology transfers — building on excellent examples like the technology localisation implementation unit at the Council for Scientific and Industrial Research. In addition, we have programmes to support innovation, such as tax incentives to encourage acquisition and innovation in production capabilities, new systems, processes, products and exports.

Many jobs are threatened by redundancy in the next wave of industrialisation and this pertains to Africa too. Existing jobs are expected to go through step-changes in the skill sets required to perform them. Others job types are expected to grow rapidly but unpredictably.

Knowledge and communications technology skills will be critical to Africa unlocking future opportunities. Upskilling is essential to ensure economic survival and social consent; a critical responsibility falls on the state and business for continuous, targeted training and retraining initiatives. Governments and business should work to assist workers and communities with the changes required to be part of the fourth industrial revolution.

President Cyril Ramaphosa recently announced, as part of government’s broader strategy to upskill the next generation with digital skills, learners will be equipped with tablet devices to assist e-learning at public schools.

We encourage SA companies to consider the rest of Africa as a key market, especially for trade in value-added products that will form part of the fourth industrial revolution value chains. Intra-African trade remains low compared to other major regions in the world such as the EU and Asia. Africa needs to increase its production base of export manufacturing and focus on facilitating the movement of goods across borders in competitive ways.

There has been encouraging progress on this front. In July 2018, SA joined almost 50 other countries on the continent in signing the Continental Free Trade Area (CFTA) agreement which seeks a single continental market for goods and services, with free movement of business persons and investments. With about 1.2-billion people on the African continent, the African CFTA agreement could create one of the largest free trade market zones in the world.

Africa has shown its digital leapfrogging capabilities in the past through successful digital transformation — the area where we are seeing economic growth occur for Africa.

To this end, we as a nation are ensuring that we are part of the important global discussions pertaining to the fourth industrial revolution because Africa cannot afford to be left behind.

The ITU Telecom World was hosted by SA for the first time in Durban in September 2018. The conference attracted 7,000 government ministers, leaders of multilateral organisations, regulators, business, entrepreneurs and small businesses. We embraced this opportunity because it ensured that Africa’s voice was heard in the important technology discussions which include preparations for 5G networks, impact and ownership of artificial intelligence, cybersecurity and the risks and opportunities of a smarter world.

Another area of focus is connecting the people who remain offline. The Smart Africa Initiative has resolved to launch the One Africa Network, which is aligned to modern thinking in the rollout of infrastructure as the continent strives to connect her unconnected citizens. Training people in digital skills is as important as rolling out infrastructure to cover everyone.

In this regard, African countries are rolling out the Internet-for-All programme which focuses on the provision of digital skills, localisation of the internet content and manufacturing and the rollout of infrastructure. Some private-sector companies, like Cisco and Microsoft, are partnering with African countries to scale up digital skills training.

All these initiatives are important because they facilitate the meaningful participation of Africans in the fourth industrial revolution and empowers us to do so on own terms.

Stella Ndabeni-Abrahams is Minister of Communications.

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