Progress through Policy: Technology in Kenya
– By Nathan Jayappa
Located deep in the rolling hills of the Kenyan Rift valley lies a picturesque county named Kericho. Lush with seemingly endless tea plantations, this county is the reason Kenya exports more tea than any other country in the world. For generations, farmers have grown tealeaves in this county due to the crop’s relative profitability, high altitude, and predictable weather conditions.
While an employee of a nearby tea factory was introducing me to local farmers in the region, he was busy checking the latest tea prices on his smartphone at the world’s largest tea market, the Mombasa tea auction. Realizing he doesn’t have time to drive back to town, he flags down a motorcycle driver and hands him an envelope marked for a law firm located in Kericho town, some 3 km down the road. The motorcyclist takes the documents and provides his cell phone number in return. Within moments of making the delivery, the courier receives a text message notifying him of payment for his delivery service via M-PESA, the largest mobile-money system in the world. “Everyone has a cell phone and uses M-PESA here. Everyone. This was not the case five years ago,” the tea factory employee informs me.
The near ubiquity of cell phones and access to internet in Kenya is the result of favorable Information and Communication Technology (ICT) polices by the Kenyan government. Kenya developed the ICT Board in 2007 in order to help Kenya become a top ten global ICT hub by 2030. The board’s strategy comprises of developing ICT institutions, increasing internet access, and promoting business process outsourcing services to Kenya. It delivers its work through five pillar projects: Digital Inclusion, Public Sector Applications, Government Shared Services, Business Processes Outsourcing/IT Enabled Services and Local Digital Content. In 2012, Carnegie Mellon’s computer science department started working alongside Kenya’s ICT Board to create certification programs for software developers in East Africa. The certification process developed by CMU requires examiners to write software that is applicable to needs of the local industry, the first test of its kind. The initial results of this test are promising, as Kenyan test-takers performed slightly better than examinees from the rest of the world.
A recent report by McKinsey & Company, Lions go digital: The Internet’s transformative potential in Africa, develops a new concept for measuring the Internet’s contribution to the overall economy as a share of total GDP, the iGDP. After assessing 14 countries in Africa that account for 90 percent of Africa’s GDP, Kenya ranked second with 2.9% iGDP. The relative economic contribution of the internet in Kenya is similar to that of other developed countries, with an iGDP % higher than that of Canada’s and Italy’s. Furthermore, internet penetration in Kenya is 28%, slightly higher than the average for the African continent, where only 16% of the population is online. This report stresses the importance of developing internet throughout all of Africa, as it can contribute over $300 billion to the continent’s GDP by 2015. Specifically, Kenya needs to better utilize its internet-savvy population to address broader social an economic challenges (Kenya ranks 145 out of 187 countries in the UN’s Human Development Index).
As a frequent visitor to Nairobi’s iHub, an open space and incubator for tech startups in the area, it is clear that the use of technology can have a transformative effect on gaining efficiencies in virtually every industry. For example, Bridge Academies, the world’s largest chain of primary schools has 212 locations throughout Kenya educating 50,000 students every day. Teachers at Bridge schools use Barnes and Noble ebook readers as the sole mechanism for delivering curriculum to students. Teacher evaluations and student testing are conducted through an Android-based software that is monitored by engineers and assessors at Bridge headquarters in Nairobi, ensuring standardization throughout all of its institutions. Additionally, if a teacher fails to open or sync a lesson plan within fifteen minutes of its scheduled start, headquarters notifies the school to identify and resolve the problem. According to recent evaluations, this model for low-cost private education is promising; Bridge students are performing better than their peers at government and other private schools with a reading fluency gap as high as 205%.
The health care industry in Kenya has recently adopted technology in order to increase efficiency and meet the needs of its citizens. Currently, only 600,000 out of 43 million Kenyans purchase health insurance or have workplace insurance. The high price of long-term health insurance plans proves too burdensome, as a majority of Kenyans choose to pay for medical expenses out-of-pocket. PharmAccess is a Dutch foundation focused on improving access to health care in remote parts of Africa through innovative finance mechanisms. PharmAccess is partnering with telecom providers throughout Africa to help the low-income rural population pay for health insurance and submit claims through their mobile phones
The economic development of a country stems from reliable, efficient access and delivery of information. The proliferation of internet access is proving to leapfrog traditional mechanisms to help African countries address social challenges and setbacks that have plagued the continent. The establishment of formalized ICT policies can have multiplicative effects on the well-being of a country’s citizens. It is imperative that Sub-Saharan African governments prioritize the development of technology to better serve its beneficiaries rather than wait for the private sector to solely drive this innovation. From a tea farmer in the Rift Valley to an unassuming motorcycle driver passing by, innovative technologies premised on sound policy are helping countries such as Kenya progress out of poverty.
Nathan Jayappa works for The Grassroots Business Fund as a BizCorps Associate. He assists the impact investing fund in deal sourcing and delivery of Business Advisory Services through conducting due diligence, financial modeling, assessing social returns, and strategic planning. Nathan graduated in 2013 with both an MBA from the Tepper School of Business and an MSPPM from the Heinz College at Carnegie Mellon University. He currently resides in Nairobi.