Category:	Science and Technology
Domain:	Economics, Social Sciences
Keywords:	Economics - mobile communications, economic growth, Africa, globalization, poverty
Outlook:	Mobile phones have the potential to spur economic growth, especially entrepreneurial business, in the Developing World.
Summary Analysis:	Since 1979 the mobile phone has played a significant role in economic development in the West. However, the poorest countries of the global south are only now beginning to experience significant diffusion of mobile phone services. The potential for mobile phones to transform the economies of developing nations is exemplified by the Grameen Phone Company of Bangladesh, which has used micro-credit financing to rapidly and widely deploy a network of shared mobile phones rented by individual village entrepreneurs. Over the next two decades, mobile telephone networks will reshape the African continent as countries that never had extensive telephone networks leap-frog into the wireless age. One recent study of Africa (sponsored by Vodafone) claims that "a 1 per cent increase in mobile penetration rates is associated with 0.5-0.6 per cent higher rates of FDI/GDP." Africa currently has just 8 mobile lines per 100 persons, but this has increased from just 3 per 100 in 2001. Over the next two decades, mobile phone networks may blossom in countries that never had extensive fixed-line networks. Thus will these countries ‘leap-frog’ into the wireless age.

	Implications:	Increased social mobility, as mobile phones are used frequently to support job search A single mobile phone increases the connectivity of many in the owner's social network, since it is shared as a resource. According to a Vodafone report, "97 percent of people surveyed in Tanzania said they could access a mobile phone, while only 28 percent could access a landline."
	Early Indicators:	According to a New York Times article, from 1999 to 2004 mobile subscriptions in Africa jumped from 7.5 million to 76.8 million. [link] Vodafone releases a report arguing for the benefits of mobile telephony in Africa, linking it to GDP growth and foreign investment. [link]
	What to Watch:	The selling of cell phone minutes through SMS as a form of micro-lending.
	Parallels/Precedents:
	Enablers/drivers:
	Leaders:	Grameen's Village Phone ("provides cellular phones via a sustainable financing mechanism to poor entrepreneurs who use the phone to operate a business") [link] MTN Banking (South African MTN created a service for simple banking transactions via SMS and eventually for transfering funds and making payments using mobile phones) [link] Vodafone New Partnership for Africa's Development (Nepad) eAfrica Commission [link] World Bank Information for Development Programme [link] World Summit on the Information Society, Tunis, November 2005 [link] The International Development Centre, Open University, UK [link]
	Figures:
	Sources:	Africa: The Impact of Mobile Phones (Vodafone Policy Paper Series, Number 2, March 2005). [link] "Loose Talk Saves Lives" Developments. Issue 31 [link] S Silberman. Wired 7.09 (1999). "Just Say Nokia" [link] H Rheingold. Smart Mobs. 2002. [link] J Sachs. 2005. "The End of the World as We Know It." [link] id21 "Do Marginal Communities Make Good Markets for Telecommunications Services?" [link] "Village Phone: Multistakeholder Partnership in Action." August 2005. OneWorld.net [link] Pambazuka News [link] "The Impact of Mobile Phones on Africa." The Commission for Africa. November 2004 [link]

	At A Glance:	When:	10 years
		Where:	Africa, Developing World
		How Fast:	Years
		Likelihood:	High
		Impact:	High
		Controversy:	Low-Medium

Related Outlooks: