NDIMBUMI MSONGOLE, Communications Specialist at Digital Opportunity Trust Tanzania (DOT), a youth-led network of social innovators, spoke to the Financial Times about the growth of the digitech sector in the country.
Q. How is DOT helping to support Tanzania's youth to become social innovators and leaders?
A. Digital Opportunity Trust (DOT) is a youth-led movement of daring social innovators with tools, knowledge and networks to create opportunities and transform their own communities.
DOT is empowering Tanzania’s young social innovators by providing them with invaluable skills, networks and occasionally funding to start their ventures into successful businesses.
Through its Digital Livelihoods program, DOT in collaboration with the University of Dar es Salaam Innovation and Entrepreneurship Centre runs ‘Dare to Change Tanzania’ programmes which seek to inspire fresh graduates to employ business models in creating solutions for community’s most pressing challenges.
Dare to Change Tanzania is a programme that runs for six weeks, and the last week leads to the Tanzania Social Innovation Conference where the top 10 participants with innovative ideas will pitch their ideas to win seed funding. The most valuable giveaway to youth is the 21st century mindset that we promote throughout the program. We are creating global citizen who want to act locally.
Q. How would you describe the current tech sector in Tanzania and what's your outlook?
A. The tech sector is growing positively each new day as it is geared towards solving pressing challenges such as access to information, financial services, health services, and education.
Also, both the government and private sector are pushing new frontiers in tech innovation by supporting innovation ecosystems. DOT Tanzania is working with young digital innovators with the inspiration to bridge Tanzania’s technological gap and solve real socio-economic problems that are facing the country.
Q. What role has the mobile phone revolution had on the growth of digital technology and innovation in Tanzania?
A. The most recent report from the Tanzania Communications Regulatory Authority (TCRA) is an eye-opener as far as the intersection between the mobile phone revolution and growth of digital technology is concerned. The report mentions that around 19 million internet users in Tanzania accessed the worldwide web in 2017 through their mobile phones, up from 18 million in 2016.
Computers are still foreign in many households in Tanzania, but mobile phones have emerged as a necessity. With the availability of affordable low-priced mobile phones, many more people now have access to the Internet and other services.
This trend has been accelerated by the advent of mobile money services, and many more innovations are underway to boost businesses through such technology. More and more applications are created by Tanzanians to help Tanzanians; we see applications to help farmers reach their consumers without passing through a middleman, which allows them to create more income for their families. Innovators are able to research and connect with similar innovators around the world with the push of a button. Used correctly, this technology is a game changer.
Q. What major challenges do tech innovators face in Tanzania?
A. According to our youth, some of the major challenges they face include the absence of incubation periods for innovative businesses, plus the lack of a proper legal and regulatory framework. For example, when a young person is looking to formalize his or her new business, to get the Tax Identification Number (TIN) he/she will have to pay estimated back taxes first. This is a great bottleneck for a startup business that has yet to make any revenues.
Technological innovations require an incubation period to test the model until the prototype is ready for scale. This phase is expensive in that little or no revenue comes into the business. At this stage, most youth will appreciate the opportunity for business incubation, mentoring, and coaching.
Another issue that technology innovators face is data security. The Internet world is mostly foreign-controlled, hence they themselves can’t be sure if their information is safe online.
Lastly is the lack of funding options that will support innovations with heavy CAPEX (capital expenditure). Banks are reluctant to fund startups, and therefore make it much more difficult for such businesses to thrive in their early stages.
Q. What should the Tanzanian government and private sector do to support tech start-ups?
(Replied By ELIGUARD DAWSON, Country Director, DOT Tanzania)
Flexible legal and regulatory frameworks that take into consideration the challenges that youth are facing will change the face of innovation potential in Tanzania. This is the government's critical input, to create a business environment that supports research and innovation by reviewing challenging policies and other frameworks. Also the government should invest in supporting state-owned innovation and incubation centers that would serve as innovation hotspots across the country.
To support tech startups, the private sector should come up with innovative financing mechanisms that would fund the startups in different phases of their businesses. Also the private sector has to trust our youth by procuring services from them. Some companies have been sourcing ICT-related services from China, Pakistan, and India, thus shutting our youth out despite their talents.
Q. What advice do you have for young Tanzanians who aspire to venture into the tech business?
A. I urge young Tanzanian social innovators to persevere, to hold on to their vision and watch it come to life. Taking a lead is never an easy thing, and the harder the job, the higher the reward. Connect with other innovative youth and make it your mission to keep learning new ways to overcome any obstacle coming your way.
Q. Where do you see Tanzania's digital tech space in the next 5 or 10 years?
A. I see a lot of growth, I see young people leading the technology space in Tanzania, and I also see the gender technological gap closing as women are currently taking charge and creating technological solutions that suit their gender as well as other broader solutions.
Q. Digital technology activities seem to be concentrated in Dar es Salaam and other urban centres. How can rural parts of Tanzania bridge this digital divide?
A. This gap can largely been closed by the government. A few years ago, the government mentioned plans to have innovation and incubation hubs in all state-owned higher learning institutions. Also the government increased its budget for research, all of which is promising news for innovators in both urban and rural settings.
There is also a movement by youth to start innovation hubs as a business model, and therefore there is hope in getting these hubs to the rural areas. On a positive note, most of the innovations are targeting rural communities, and therefore the use of technology in the rural areas will also stimulate innovators from rural areas.