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Ease regulation to scale Africa’s digital development

Simnikiwe Mzekandaba
By Simnikiwe Mzekandaba, IT in government editor
Johannesburg, 09 Nov 2022
From left: Moderator Russell Southwood, Liquid Intelligent’s Nick Rudnick, MainOne’s Funke Opeke, Convergence Partners’ Andile Ngcaba, and Nika Naghavi from MFS Africa.
From left: Moderator Russell Southwood, Liquid Intelligent’s Nick Rudnick, MainOne’s Funke Opeke, Convergence Partners’ Andile Ngcaba, and Nika Naghavi from MFS Africa.

In terms of regulation, the role of the state should change to be an enabler, says Andile Ngcaba, chairman of Convergence Partners.

Ngcaba was speaking during a high-level panel discussion about Africa’s history of technology and its future at the Africa Tech Festival 2022 in Cape Town yesterday.

He was joined by Nic Rudnick, group deputy executive chairman of Liquid Intelligent Technologies, and MainOne CEO Funke Opeke, among others.

The Convergence Partners chairman made similar assertions in 2020, when he said a new body and new regulator need to be created in SA, stressing that regulators must be enablers.

Yesterday, he reiterated his stance that regulators either need to “close down” or become “digital-enabling organisations”.

“We should remove the word ‘regulation’ in laws, in technology vocabulary. It might have worked at the beginning, but I think now, if we still think that we will use that model in the digital era, it will probably become counter-productive.”

Ngcaba explained that when the markets had to open up, for example, people said there’s going to be chaos with so many people operating companies; therefore, there must be one national operator running telecoms. “That’s how people were thinking.

“In my culture, when you give a child a name, it has a meaning and you become your name. When you are called a regulator, you always want to stop things.

“When your name is enabler, you’ll want to enable. We need to make sure that we really…enable to get to the digital era.”

Similarly, Rudnick said when the liberalisation started, governments began to issue spectrum but there were very few, if any, independent regulators, so spectrum was issued into a void.

“I think private enterprise does very well in a void, and that spectrum was taken, and in some cases traded and resold, but we saw emerging out of that some of the giants of the African telecommunications and now-technology industries.

“They really thrived in that free and open market – I don’t think governments realised how successful the mobile industry was going to be and what the uptake was going to be. It was a very open and unregulated environment, where if you could get your hands on the spectrum, you could almost build what you wanted and how you wanted it, without very much regulatory intervention.

“Since then, the independent regulators have not only become the institutions but have become a lot more assertive. I think in some countries that has been for the good, but in many it’s been an impedance to the rollout of the new-generation networks that we are seeing. Through delaying the release of spectrum, the fees, taxes and applications in terms of wayleaves and other approvals needed for fibre rollout have become more and more onerous over the years.

“Some regulators sometimes need to understand that keeping out of the way of the industry is the best way to encourage development. What history tells us is the rapid growth of the mobile industry across Africa happened in a time when there were low levels of regulation rather than high.”

MainOne’s Opeke agreed with Rudnick, saying: “The regulation has not quite kept up with what is required to continue to drive development in a lot of areas. Development has slowed down, or started to become more concentrated in urban areas or areas where there is high affordability, when the need might actually be in areas where they don’t have the infrastructure, high unemployment and lack of productivity.

“There is more work to be done and more political will is required to make that push. Unless governments create the enabling environment in a lot of our markets, it’s really tough to deploy the kind of capital and drive development to the people.”