Malili ICT Park, Kenya

The transformation of Kenya into a regional ICT hub will begin with the leasing of a 5,000-seat Business Process Outsourcing Centre at the Sameer Industrial Park along Nairobi’s Mombasa Road. “We have put out our request to Treasury and we are optimistic everything will fall into plan,” says Dr Ndemo. The deal will be to prepare the ground for Kenya’s first technology city to be built on the 5,000 acres of land at Malili Ranch in Machakos, which neighbours Nairobi, the capital city.

This means once Malili Park is complete, the momentum will have been gained at Sameer Park and Kenya’s bid to become Africa’s ICT hub will be unstoppable. According to Ms Eunice Kariuki, Deputy CEO, Kenya ICT Board, Malili’s core objective is to host BPO and ITES companies as well as university innovation centres to complete the supply chain. “Other complementary facilities will be developed, including housing, hospitality, education, health and recreational facilities, to create a sustainable ecosystem,” she said.

Kariuki said the Kenya ICT Board is proactively driving key sector developments, including content grants whose second release is scheduled for early 2011, the development of a BPO/ITES centre of excellence whose implementation is at an advanced stage, incubation centres and software certification.“All of these are at very advanced stages and they are paramount to scaling capacity to supply the ICT sector with guaranteed high quality talent and innovations,” said Ms Kariuki.

Mr Ndemo is sure that Kenya’s bandwidth capacity and its status as the regional economic and transportation hub for eastern and southern Africa also makes it stand out as a preferred destination for many investors. According to the World Bank report, the growth in ICT is significant and has outperformed all other sectors over the last decade. Without ICT, Kenya’s growth rate would have been only 2.8 per cent since 2000, barely exceeding population growth.

The report, Kenya on a Tipping Point, indicates that the benefits of ICT are starting to be felt in other sectors. The report attributes the explosive growth in ICT to the liberalisation of the telecommunications sector, which induced competition and innovation, resulting in considerable investment and job creation. The economic report, the third in a series, captures the emerging momentum for growth with a special focus on the Information and Communications Technology (ICT) revolution and mobile money.

The report argues that Kenya could develop into a regional hub of IT innovations and IT-enabled services due to its cost advantages, investment in enabling infrastructure — including fibre optic cables and a well-educated and urbanised labour force.

It is no secret that Kenya’s ICT platform enabled innovation in mobile money, which has expanded exponentially since it was introduced in 2005 by Kenya’s most profitable mobile phone operator, Safaricom. According to Ms Jane Kiringai, Senior Economist for Kenya and co-author of the World Bank report, mobile money is one of the greatest success stories of Kenya’s ICT revolution.

Currently, more than 70 per cent of all adult Kenyans have access to financial services, compared to less than five per cent in 2006. “One key reason for this success is that regulation followed innovation,” argues Ms Kiringai. The report projected that 15 million Kenyans transferred US$7 billion, equivalent to 20 per cent of Kenya’s GDP, through mobile money in 2010. Since 2000, mobile prices have plummeted and usage rates have increased exponentially.

Today, 9 out of 10 Kenyans have access to a mobile phone, and the introduction of mobile money, in which Kenya is already a global market leader, has brought financial access to millions. Among the many uses of cell phones, the most innovative is mobile money — money that is stored and transferred by mobile phone. By the end of 2010 it was projected that two-thirds of Kenyans above 15 years would be using mobile money, transferring an estimated 20 per cent of GDP.

Even internet access seems to have reached a tipping point, with an expected 8 million subscribers, many accessing it through mobile phones. The remaining hurdle is to ensure Internet connectivity prices decline further to make the Internet accessible to the majority of Kenyans. Only Kenya has introduced mobile money on such a large scale.