Economist: Slow Internet Holding Back S. African Job Growth

Economist: Slow Internet Holding Back S. African Job Growth

South Africa has the slowest Internet speed of any major economy in Africa, Europe and Middle East, and government’s failure to implement a national broadband policy is costing jobs and growth, according to a report at TheSouthAfrican.com.

Job creation can’t move forward while South Africa lingers in the internet backwoods, said Kevin Lings, chief economist at South Africa’s Stanlib, one of the top investment managers in South Africa. Lings spoke at a business technology meeting.

Lings’ view is echoed by many South African business groups and the information and communications technology industry, the report said. South Africa’s poor record of internet expansion was reported in the Akamai report, “The State of the Internet Q1 2013.” The report is viewed as an authority in the industry due to the Akamai group’s Intelligent Platform, handling two trillion content requests a day, TheSouthAfrican.com reports.

Not only are Akamai’s figures beyond dispute, but the investing world and outsourcers read it, Ling said.

“As the business processing outsourcing industry continues to move into more complex and data-hungry forms of customer care (such as video chat), BPO investment in South Africa will become a bellwether for the way in which the country’s persistent lag in making broadband access broad acts as handbrake on the entire economy,” the report said.

South Africa, already last in Internet speed in Africa, Europe and Middle East, appears in no hurry to catch up, the report said. While global average connection speed increased by 4 percent to 2.1 megabits per second, South Africa trailed behind with a 3.5 percent increase. The region’s best performer, Switzerland, reported nearly twice that increase. This leaves South Africa and Turkey (at 3.1 megabits per second) as the two countries featured in the report where the average internet user experiences speeds below the official “broadband” threshold.

“It is time government starts taking the ICT sector seriously,” Industrial Development Corporation Analyst Spiwe Chireka told ITweb.co.za. “It is one of South Africa’s chief economic sectors and if it doesn’t start running smoothly, it’s going to catch up to us.”

South Africa’s Department of Communications underwent a series of recent leadership changes. A spokesperson said in the report that a rollout for a national broadband policy was being prepared as a matter of urgency. Funding for the rollout recently suffered a blow when the South African treasury ordered the Department of Communications to return $50 million in funding for broadband until it could produce a plausible and rigorous plan for the rollout of fast internet to all South Africans by 2020.