Wits report: SADC needs greater cooperation, liberalisation to attract ICT investment


With the member states of the Southern African Development Community (SADC)
set to resume ongoing negotiations soon on the communications sector in the
region, the Link Centre at the University of the Witwatersrand (WITS),
commissioned by the German Society for International Cooperation (GIZ),
compiled a report providing an exhaustive assessment of communications policy,
law and regulations in the 15-member bloc.

The study looks at telecommunication, broadcasting and “other audio-visual
services’, a category covering such fields as film production and distribution.
The study examines these sectors across southern Africa with respect to five
focus areas: market structure, regulatory regime, level of competition, state of
liberalisation and international commitments. It provides a full breakdown of the
market structure in each country, listing the exact Information and
Communications Technology (ICT) services offered, the market share of local
and foreign firms and the government policies affecting the particular industries.
It begins from the premise that the various aspects of the communications
sector are: “major facilitators of growth, contributing to the improvement of
welfare, enabling traditional merchandise trade, as well as offering new trade

The executive summary of the report states that, since SADC members are eager
to take advantage of the opportunities offered by the ICT sector, they need to
take into account the “… fierce global and regional competition to attract
investment for ICT-related trade,’ and therefore make sure that the ICT
environments within their respective countries and the region as a whole are set
up to make them serious contenders for that investment.

The report examines the region as a whole and then focuses on each country in
turn, examining how the market and regulatory structures in place enable their
ICT sectors to compete for international investment. It uses the World Trade
Organisation’s (WTO) policies as a yardstick, measuring to what extent the
region’s ICT sector complies with or deviates from the global body’s

On the whole, the findings of the report indicate that the region could benefit
hugely from ICT investment injections but its attractiveness to this kind of
business is adversely affected by the collective weaknesses of the member
states. These differ from country to country; some states, such as the
Democratic Republic of Congo, suffer from low income and macroeconomic
instability. Others, such as Namibia and Botswana, show good prospects in
terms of governance and economic stability but contain very small markets due
to their sparse populations.

Then there is South Africa, which has the industrial-based economy and
economic strength to draw investment but has suffered from weak policy and
government interference in the ICT sector, crippling its growth and international
competitiveness. Such challenges are not easily solved but the region can
increase its competitiveness through strategic cooperation that lowers the cost
of doing business in telecommunications, broadband, broadcasting and film
production and allows members that are stronger in particular areas to
compensate for the corresponding weaknesses of others.

Another key, says the report, is the adjustment of legislation, policy and
regulations to liberalise the sector and reduce state interference – but not to the
extent of full privatisation, which has been found to have a less positive impact
on ICT development than liberalisation.

With respect to ’other audio-visual services”, this was found to be a marginal
sub-sector throughout the region, except in South Africa, where it is already a
relatively well-developed “… set of fully or partially competitive sub-sectors’.
Nonetheless, the report recommends the free movement of companies in these
sub-sectors between countries in the SADC bloc, opening all national markets to
any and all firms wanting to operate within them.

The full report can be read at:


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