AI : opportunities for inclusive growth in Africa

In November 2024, the French Development Agency (AFD) published an innovative report titled « AI Investment Potential Index: Mapping Global Opportunities for Sustainable Development. » This in-depth analysis explores the role of artificial intelligence (AI) as an economic growth lever, with particular attention given to developing countries. For Africa, where AI represents both an opportunity and a challenge, this report is of particular importance.

The AI Investment Potential Index (AIIPI), developed by the AFD, is a tool designed to guide decision-makers on key factors influencing AI investments, such as macroeconomic conditions, digital readiness, infrastructure, and human capital. The aim is to help financial institutions, governments, and development organizations make strategic decisions that foster inclusive and sustainable growth.

The promise of AI for Africa

Artificial intelligence is seen as a transformative force capable of reshaping economies and advancing development goals. As highlighted in the report, AI could significantly contribute to global economic growth, with projections indicating that generative AI alone could add between 2.6 and 4.4 billion dollars to global productivity. This digital revolution could be comparable to the industrial revolution, making AI an essential driver of future economic growth.

However, the report highlights the uneven distribution of AI benefits globally. While advanced economies such as Europe and the United States are well-positioned to fully exploit the potential of AI, many African countries face barriers in capitalizing on this technology. These barriers range from insufficient infrastructure and gaps in digital skills to political instability and underdeveloped financial systems.

Africa’s position in the global AI landscape

Overall, the report shows that African countries are at varied levels when it comes to AI investment potential. Countries like Morocco, Mauritius, and Gabon stand out as leaders in AI adoption on the continent. These nations have actively set up AI hubs, developed digital infrastructure, and facilitated international collaborations, placing them in a favorable position to attract further investments.

On the other hand, countries like Eritrea and South Sudan face major challenges in infrastructure and digital readiness. These countries are still at the early stages of AI development and require substantial support to lay the groundwork for adopting this technology. For instance, lack of reliable internet access and basic technological infrastructure prevents local businesses from capitalizing on AI opportunities.

The AIIPI and its implications for African policy

The AIIPI methodology, which combines statistical modeling and an entropy-based weighting approach, provides a comprehensive framework for assessing a country’s readiness for AI investment. According to the report, Africa scores moderately (36.61), reflecting both the region’s challenges and its opportunities. Sub-Saharan Africa, in particular, faces numerous obstacles but has significant untapped potential.

Policy implications for African governments include the need to promote public-private partnerships to address infrastructure gaps and invest in digital education to develop the human skills necessary for AI adoption. Moreover, regional cooperation could enhance Africa’s position by enabling countries to share resources, knowledge, and investment opportunities.

By adopting AI, African countries could achieve transformative economic progress while reducing social inequalities

The report also emphasizes that AI can significantly contribute to the United Nations’ Sustainable Development Goals (SDGs), particularly in areas such as Industry, Innovation, and Infrastructure (SDG 9), Reducing Inequalities (SDG 10), and Peace, Justice, and Strong Institutions (SDG 16). By adopting AI, African countries could make transformative economic progress while reducing social inequalities. However, this progress will depend on the region’s ability to tackle its unique challenges, such as improving internet connectivity, political stability, and inclusive development.

The gap in AI preparedness between African countries and those in Europe or Asia remains substantial

AI investments in Africa hold the potential for economic transformation, but the region must overcome several barriers. As the report shows, the gap in AI preparedness between African countries and those in Europe or Asia remains substantial. However, targeted investments, strong policy frameworks, and international collaboration can help bridge this gap. African governments and institutions must create an environment conducive to AI growth, focusing on infrastructure, education, and digital inclusion.

In summary, while AI offers enormous potential for Africa, realizing this potential will require addressing the region’s specific needs and leveraging its strengths. As the AFD report highlights, “AI can serve as a driver of inclusive and sustainable development, but it is up to African countries to ensure they are prepared to harness its power effectively.” The future of AI in Africa depends on a collaborative effort to overcome barriers and seize the opportunities it offers for economic and social progress.

This AFD report serves as a call to action for African policymakers, investors, and institutions to act strategically, ensuring that AI contributes to the continent’s sustainable development goals. By cultivating a robust AI ecosystem, Africa can not only catch up with global AI trends but also become a leader in AI-driven innovation and sustainable development.

Consult the report : AI Investment Potential Index: Mapping Global Opportunities for Sustainable Development