African Unity through Private Entrepreneurs

by Thompson Ayodele
One of the primary objectives of the African Union is to foster economic and political integration of the continent. Aside from African Union, there are other regional organisations established to foster economic integration within a particular region. Effective integration in Africa is seen as one of the ways to overcome the challenges confronting Africa.

The idea of African unity mainly exists on paper. There are no concrete efforts to ensure that African countries benefit from one another in term of strong economic cooperation. This is not intentional. Aside from language barrier, there are communication and transportation problems which hinder free movement of goods and services. Various governments and regional organisations efforts to create borderless Africa have not seen the light of the day.

With a total of 53 African Union member states, 15 landlocked (non-costal) states and 7 Island states, air transportation that ought to foster Africa integration has not made any impact. Aside from high fares which characterised inter-African flights, air transport is best linked with countries in Europe and North America. Compared to other continent, Africa’s annual air traffic is about 4.5% of the 1.8 billion global passengers’ traffic.

This poses a daunting challenge to free movement of goods and services in Africa. Improved technology and the realisation by the private sector to truly unite Africa have begun to gain currency. Of course there are enormous economic advantages in having a close knit Africa. The mobile telecom companies in Africa have set the stage for African unity.

This is coming as a result of liberalisation of the sector in many parts of the continent. Over 36 countries have created a separate regulatory body for the telecom sector. Also, about 45 countries have licensed private cellular operators. This has paved way for effective cellular competition to spring up.

Real integration is coming from private sector. Telecom companies operating in the continent are demonstrating this with the launch of a single network. With its launch in September 2006, this market innovation has guaranteed the free movement across geographic borders.

Ultimately, this has become a pace setter for the emergence of a strong market within Africa.

One network initiative started in East Africa. Today, it has now expanded to be in operation in 12 countries comprising East, Central and West Africa. As a result, 400 million people in these parts of Africa can make calls and send SMS at local rates. In this regard, common market price is being achieved following the same average tariff offered by the telecom companies.

The benefits of course are immense. It would eliminate calls within Africa which have to be first routed through Europe before connecting. Subscribers can make and receive calls wherever they are in the 12 countries. In addition, they would be able to keep pace with their businesses without worrying on how to connect with their business partners back home. Also it is possible to make calls and charge for the outgoing call at the same average tariff as a local customer.

In essence, one network has really launched Africa towards becoming more united with improved trade relation. By implication private telecom operators are cementing various parts of Africa while at the same time putting the continent on the sure road to economic prosperity. Above all, the new development would play a crucial role in promoting cross-border trade and spur economic growth.

What can be deduced is that African unity is quite possible. This is aptly being demonstrated. However, it might be impossible to attain if various governments in the continent are left to have this realised. At best, African unity would continue to be on paper and a subject of discussion at every forum.

By and large, the gradual increase in attaining borderless Africa is proven to be possible through private sector. This is a sheer indication that the objectives of the African Union and several regional organisations are gradually being taken-over by private entrepreneurs who are ready to think outside the box.

What needs to be done is for various governments in the continent to phase out all laws and regulations that hinder private sector participation in the economy. Since there are willing telecom operators who are poised to connect various parts of Africa with their networks, it is incumbent on telecom regulators and state officials of various countries in Africa to reduce and simplify licensing procedures.

Better still, they should stop imposing huge license fees on mobile telecom operators. When this is done, it would be one of the practical ways to actually unite Africa.

Ayodele is the executive director of Initiative for Public Policy
Analysis in Lagos.