The success of SA's digital transformation hinges on the country’s ability to expand connectivity and use AI to accelerate industrial intelligence in public and private sectors.
This is a key takeaway from the Huawei South Africa Connect 2025 event, hosted by Huawei and its partners at the Sandton Convention Centre, in Johannesburg, on 3 July.
This is the first time Huawei’s Connect platform has focused specifically on SA, signalling the company’s deepening interest in the country.
Speaking at the event, SA’s minister of communications and digital technologies Solly Malatsi said the country’s digital economy is gaining traction, and lauded progress of SA’s digital transformation roadmap launched in early 2025. He noted it is in line with SA’s aspirations as one of the leading digital hubs on the continent and its status as the current holder of the G20 Presidency.
Malatsi mentioned rural clinics offering virtual consultations, learners accessing online education and township entrepreneurs taking their products to global markets as examples of progress.
However, Malatsi added there are still too many citizens without access to technology. “There remain too many schools without basic digital tools, homes without internet and communities without the digital skills to thrive in the digital economy. As government and as a society, we cannot allow the digital age to deepen inequality or create new forms of exclusion. We must ensure that the benefits of connectivity and technology reach everyone.”
He said the government of national unity has placed digital inclusion at the heart of its development agenda and identified four measurable ministerial priorities, including: expanding connectivity and access to devices, building a digitally skilled society, unlocking the productive use of technology and creating a supportive environment for inclusion and investment.
“Digital inclusion means nothing if resources are not used strategically,” said Malatsi. “The digital revolution must be a foundation for equality, not a new dividing line.”
Malatsi referred to phase two of Operation Vulindlela as part of SA’s digital transformation roadmap.
This roadmap sets out four core reforms:
- A digital ID that allows citizens to verify themselves remotely.
- A secure data exchange system across departments to eliminate duplication and delays.
- A real-time digital payments platform for faster, cheaper government transactions.
- A single, zero-rated portal for all government services.
“These are not just technical upgrades – they are people-centred solutions that can be life-changing,” Malatsi added.
AI cloud offering
Huawei has underlined the relevance of its AI cloud offering and emphasised the building of AI-native cloud services to drive its technology and expertise into SA’s digital ecosystem.
The company has invested in its cloud technology capability, with technology like CloudMatrix 384, an AI supernode supercomputing solution designed for large-scale AI model training, as well as the roll-out of Pangu, the company’s LLM, to help entrench its AI-driven everything as a service strategy.
In June 2024, Huawei launched an updated Pangu 5.0 LLM and the latest version of its Harmony operating system, HarmonyOS Next. The new OS is designed to be used across all Huawei products, as the company continues to focus on building AI-native infrastructure to support AI adoption and supply the requisite computing power.
Cloudification is imperative in the AI era. Huawei Cloud Stack, the company's cloud-infrastructure data centre solutions that can be deployed on an enterprise’s premises, offers the same performance and service experience as the public cloud, while meeting the needs of localised data protection, the company said.
Joy Huang, VP of Huawei Cloud, said AI has developed from perception to reason and now to agentive AI. He referred to the adoption of AI agent innovation within the financial services space, with the application of multi-agent collaboration and ultra-personalisation of service.
Huang also emphasised the need for synergetic innovation across cloud, network and device.
Honge-Eng Koh, global chief public services industry scientist, said the 5.0 industrial revolution is already here, with hybrid cloud and AI being used to drive efficiency and productivity in healthcare, education, retail, manufacturing and government.
To emphasise the importance of digital infrastructure in an economy, Koh said: “In China, over 50% of the country’s GDP is sourced from the digital economy.”
He listed several factors for digital transformation success, including vision and leadership, governance and structure, law and regulation, people and culture, operating model, security and sovereignty, data strategy and a technology ecosystem.
Gene Zhang, CEO of Huawei South Africa Enterprise Business, said: “The rapid advancement of AI is undoubtedly ushering in a new wave of tech, social and economic transformation. AI is emerging as the main driving force of digital and intelligent productivity across all sectors. In recent years: AI models have improved significantly – reports show that since 2022, the accuracy of various AI models has increased 91.5%. Additionally, the cost of using AI has rapidly decreased – data shows that since 2022, the price of AI model usage has dropped 99.3%. As a result, AI adoption is accelerating across industries – with 53% of enterprises already using AI.”
Zhang added that looking ahead, to sustain positive momentum and unlock the full potential of AI, SA must address three key challenges: AI infrastructure, industry application, and talent and local ecosystem development.
First, in terms of infrastructure, the main challenges lie in three core areas: data, computing power and connectivity, he added.
“Data is the fuel of intelligence. It is projected that by 2030, the world will generate 1 yottabyte of data annually. To put this into perspective, South Africa currently produces less than 3.5 zettabytes, with less than 30% utilisation. This is largely due to the absence of unified platforms for data collection, storage and processing. Computing power is the brain of intelligence. Global demand for AI computing power is expected to reach 105 ZFLOPS by 2030 – 500 times that of today. Yet, South Africa’s AI computing growth rate remains below 60%.”
Zhang said connectivity is the foundation of intelligence. “By 2030, 23% of households worldwide are expected to have 10Gbps bandwidth. However, in South Africa, only 30% of households have bandwidth above 30Mbps – and average enterprise WiFi remains around 100Mbps. Second, regarding industry-specific applications, AI adoption is still at the early stages. Cloud penetration is relatively low, and AI has yet to achieve deep integration with verticals.”
He added that regarding talent and local innovation, SA currently faces a talent gap of 500 000 in ICT, with 60% of this concentrated in AI, big data and cloud.
“The country's total AI investment stands at around $500 million, but 70% comes from foreign sources. This highlights a clear need to accelerate local AI investment and development,” said Zhang.
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