The mobile industry has the potential to spur economic growth in Africa by connecting the unconnected and making them economically active.
This is according to Ben Soppitt, strategy director for the GSM Association (GMSA), who addressed the GSM Africa conference in Cape Town this week.
"The mobile industry is connecting almost four million new subscribers a week [in the emerging world, including Africa]. That`s 400 a minute, and more than a billion over the next four years," he said.
"This underlines the fact that mobile is actually unique as an industry at crossing the digital divide at enormous scale.
"And we`re doing it today without the active participation of the development community, and often without the support of regulators."
Vitalis Olunga, chairman of the GSMA in Africa, opened the conference and said the World Bank recognises the mobile industry as an economic development tool.
Africa`s mobile users grew to 107 million people by the end of the third quarter this year, up from 81 million at the end of last year and 53 million at the end of 2003, he said.
Soppitt warned that there are significant barriers to the industry`s growth, including disproportionately high taxes on handset sales in many developing countries and regulatory problems.
According to a recently completed GSMA study, "a government that lowered sales taxes on mobile services by just one percentage point would boost the number of mobile phone users in its country by more than 2% between 2006 and 2010".
"In some cases, lowering taxes on mobile communications could actually increase government`s total tax revenue in the longer term. Each new mobile phone user would generate an additional $25 a year in service tax revenues at the current levels of taxation on usage," the report found.
Soppitt maintained it would be na"ive to ask governments to forego all the tax on mobile phones, as this has become a major source of revenue for them, but he suggested such tax be exempted from the GSMA`s initiative for so-called ultra-low-cost handsets.
To this end, the GSMA has launched a second round of its Emerging Market Handset Initiative, for which Motorola was chosen to produce sub-$30 handsets for developing countries from January 2006. Motorola also won the tender for the first round, which aimed to produce $40 phones.
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