Kenya is at a very important point in its digital transformation. If the needed changes are made, the digital sector could be a big part of the country's economic growth.

Kenya's digital economy is projected to contribute a substantial 662 billion Kenyan shillings (approximately $5.13 billion) to the country's GDP by 2028, according to a new report.

The report, titled "Driving Digital Transformation of the Economy in Kenya," was presented to Kenyan authorities by the GSM Association (GSMA) on Tuesday. It explains that this growth will be largely driven by digital transformation in key sectors such as agriculture, manufacturing, transportation, and commerce.

The impact of this digital momentum will extend beyond GDP growth. The report estimates that these reforms will create 300,000 new jobs and increase tax revenues by 150 billion shillings. These efforts align with President William Ruto's "Kwanza" program, which prioritizes the digital economy to diversify revenue sources and boost job creation, particularly for Kenya's youth. The potential of digitalization is seen as crucial for enhancing productivity, especially in rural areas, and addressing challenges posed by population growth.

Barriers to Digital Adoption

Despite these promising prospects, the GSMA report points out several obstacles hindering the widespread adoption of digital technologies in Kenya. A significant challenge is the gap between network coverage and actual mobile internet usage. While 99% of the population has access to 3G and 98% to 4G, only 33.5% of Kenyans actively use mobile internet. This digital divide limits the full integration of digital services into the national economy.

High costs of devices and connectivity, along with a lack of digital skills among the population, are identified as the main barriers to broader adoption. To address these issues, the report calls for bold policy measures aimed at reducing these costs, boosting demand, and encouraging further investment in digital infrastructure.

Samira Njoya