A World Bank (WB) report has exposed threats that hinder success in Zimbabwean digital entrepreneurs.
Digital entrepreneurship, to summarise the definition, is a process of designing, launching, and running a new business using novel digital technologies as a driver of new value creation.
Billionaires including Jeff Bezos, Larry Page, Sergey Brin, and Mark Zuckerberg rose in this practice.
IHarareJobs, Ecocash, Cassava Smartech, Vaya Africa, and Ruzivo are amongst some of the known digital entrepreneurship businesses in Zimbabwe.
Threats to Digital Entrepreneurship
Threats to Zimbabwe’s digital entrepreneurs include the deteriorating macro-economic situation, foreign exchange controls, and declining business confidence in the country. The WB’s Digital Economy for Zimbabwe Diagnostic Report also lists unstable electricity access and coverage limits uptime as a threat.
The report says the deteriorating macro-economic situation affects consumer and business demand for new products and services, access to affordable finance, and also access to skilled labor.
Zimbabwe has in the past witnessed electricity loading sheddings going for 20 hours and this negatively affects electronic gadgets that rely on electricity for power.
“Foreign exchange controls affect entrepreneurs’ ability to import needed equipment and software licenses,” the report says.
Declining business confidence is affecting entrepreneurs’ and investors’ level of investments in new ventures according to the World Bank.
Another threat to digital entrepreneurs in Zimbabwe is expensive data. Zimbabwe’s data charges have been rated as some of the highest on the continent. This makes the majority of the population which is living below the poverty datum line, fail to access the internet. It also reduces the market for digital entrepreneurs.
Commenting on the WB report Information Minister, Minister Monica Mutsvangwa noted that digital entrepreneurship in Zimbabwe lacks funding.
“Finally, Digital Enterpreneurship was assessed to be in its early stages and in need of greater funding for start-ups as well as for development of links between innovation centres and businesses in order to enable commercialization of inventions,” she said.
Government Response to the WB Report
The report noted Zimbabwe’s strength that the digital payment system takes up 96% of transactions in Zimbabwe and the government has also been using this extensively.
In respect to the report as a whole Mutsvangwa said the cabinet noted that Zimbabwe has made remarkable progress since the report Survey was conducted from 2018 to 2019.
“Government acknowledges that the Report will assist in improving the country’s methodologies for defining the digital economy ideas, especially the metrics for measuring progress in the implementation of NDS1 and definition of the relevant Key Performance Indicators (KPIs), she said.
Dr. Misheck Sibanda, Chief Secretary to the President and Cabinet said “We recognize the potential for digital technologies to help pave the way forward and are therefore focusing on development of the key digital pillars that will underpin the growth of our economy.”
World Bank Comment
The report shows that Zimbabwe is quite advanced in the Digital Financial Services pillar, mainly due to the ubiquitous use of mobile money and online banking services.
World Bank Country Manager, Zimbabwe, Mukami Kariuki’s comment to the report was that Zimbabwe is well-positioned to reap significant dividends from a digital transformation.
“However, to achieve the desired results, strategic action is required to strengthen the policy and regulatory framework; resource management and coordination; governance and transparency; and capacity building,” Kariuki added on.
