How Africa can turn its digital footprint into economic power

Governments must develop national data governance policies distinct from data protection laws, with clear frameworks for how anonymised and aggregate data can be shared. [iStockphoto]

Every day, the world generates 2.5 quintillion bytes of data. Africa, home to 1.4 billion people and one of the fastest growing mobile populations on earth, contributes a significant and rising share of that torrent.

By 2030, the continent's data economy is projected to be worth $290 billion. Yet Africa's share of actual value captured from the global data economy remains below three per cent.

The data is here, the wealth it should be generating is not. The gap between those two facts is not a technology problem. It is a governance problem. When an international investor sits down to assess an African market, one of the first questions they ask is: what does the data say? What is the consumption trend in this sector? What is the demographic profile of this city?

In most of our countries, the honest answer is that nobody knows, at least not officially. The data exists somewhere. It lives in the servers of global technology platforms, in the back offices of mobile operators, in the filing portals of government agencies that have never been asked to share what they hold.

There is no framework to surface it, policy to govern its use, and infrastructure to process it at scale. The result is a paradox that is quietly strangling African economic growth.

For the past decade, the continent's policy conversation has been almost entirely consumed by the question of how to protect personal data from misuse. That conversation was necessary.

Kenya's Data Protection Act, the General Data Protection Regulation in Europe, and the Africa Union's own frameworks were important steps. But somewhere along the way, protection became the whole story, and that is where we went wrong.

Data protection laws regulate a narrow category of information: personally identifiable data traceable to a named individual. Their health record, financial transaction and biometric profile. This category is important and deserves the legal safeguards it has received. But it represents a fraction, perhaps less than one per cent, of the data that African economies generate daily.

The rest, aggregate, anonymised, sectoral, institutional, is not personal data within the meaning of the law. It cannot be traced back to any individual. There is no legal barrier to using it. And yet it sits idle, because an entire ecosystem of organisations - from hospitals to government registries and financial institutions - has decided that the safest response to data regulation is to share nothing at all.

The costs are measurable. The GSMA has found that a 10 per cent increase in mobile data utilisation in Africa could contribute up to two percentage points to a country's GDP growth.

The World Bank has documented that improved access to administrative data can reduce the cost of doing business in developing economies by up to 25 per cent.

The African Development Bank has linked the absence of reliable sectoral data to billions of dollars in annual losses from inefficient resource allocation across the continent.

These are not abstract numbers. They represent hospitals that cannot plan bed capacity because patient flow data is locked away, roads built in the wrong places because no one queried movement patterns available in our own telecommunications infrastructure and investors who fly into Nairobi, spend three days trying to understand a market, and fly out without committing capital because the data they need simply cannot be found.

The African Union's Data Policy Framework, adopted in 2022, recognised this and called on member states to build governance ecosystems that balance protection with access, sharing, and economic activation.

Most governments, Kenya included, have yet to translate that call into legislation. Baby steps have been commenced in Kenya with the proposed National Data Governance Policy. It will come in handy when it takes effect, and hopefully, implemented effectively.

At G&A Advocates, two decades of advising investors, governments, and businesses across sectors, from infrastructure and financial services to energy, health, and technology, have brought us repeatedly to the same inflection point.

The clients with the greatest appetite for Africa are invariably the ones most frustrated by the absence of reliable, accessible data. Data governance is no longer a compliance but an investment question.

Three things must change. Governments must develop national data governance policies distinct from data protection laws, with clear frameworks for how anonymised and aggregate data can be shared.

The private sector cannot wait for government to lead. Companies holding large datasets need legal counsel that helps them understand what they can lawfully share and what protections apply when they do. And Africa must invest urgently in the infrastructure to process data at scale.

Data is the new oil as the cliché goes. If that analogy holds, Africa is sitting on enormous reserves with no refineries, no pipelines and no coherent extraction policy. The question is whether we will keep watching others profit from our reserves, or finally build the architecture to govern, share and benefit from what is ours.

That conversation cannot wait. The cost of delay is not a future problem. It is the growth we are not seeing today.

- The writer is a partner at G&A Advocates LLP, which advises on infrastructure, capital markets and technology law across East Africa