The United Nations on Monday urged African states to develop regulations in order to spur e-commerce growth.
Mukhisa Kituyi, Secretary-General of UN Conference on Trade and Development (UNCTAD), told journalists in Nairobi that the continent lags the rest of the world in the uptake of digital trade due to lack of a conducive ecosystem.
“Africa needs to develop laws to enhance on integrity of procurement on electronic platforms so that consumer can trust e-commerce platforms,” Kituyi said during the African Union e-commerce conference in Nairobi.
The three-day event aims to provide a platform to enhance understanding of the current state of e-commerce in Africa, the challenges and opportunities, build on the experience of actors on the ground as well as other regions of the world, and to discuss key elements of a roadmap for the development of a African protocol on intellectual rights to facilitate emergency of African players.
Kituyi called for adequate regulations to protect consumers who order goods electronically and as well as delivery mechanism to ensure seamless connectivity of goods procured online.
He noted that some of the rules that need to be introduced should ensure that e-commerce firms are compelled to deliver goods paid for by consumers as they have promised.
According to UNCTAD senior official, states should also develop online dispute mechanism so that contracts can be honored by all parties involved including in the case of cross border trade.
He noted that e-commerce has numerous advantages over traditional platforms because it can provide visibility for small scale producers to global markets.
“However, for the small business community to benefit they need to develop products that are of global standards,” he said.
Kituyi said that Kenya, South Africa and Nigeria lead the continent in the performance of e-commerce as they have all recorded approximately 6 percent of overall trade as being conducted in digital platforms as at the end of 2017.
He said that Kenya has one of the most advanced mobile money payments systems in the world with about 85 percent of adults having a mobile bank accounts.
“However, high financial inclusion is not a sufficient condition to catalyze e-commerce especially in the rural areas that lack physical infrastructure to provide efficient delivery systems,” said Kituyi.
Kiyuti who is also a former Kenyan trade minister decried the lack of domestic e-commerce platforms in the continent.
He said that local e-commerce platforms are likely to show more fidelity to local producers and boost domestic productivity as opposed to foreign players that have a bias towards selling more international goods locally.
Kituyi noted that it is not too late for Africa to catch up to the rest of the world in digital commerce because the region has the intellectual capacity to do so.
“What is required is dialogue between private sector, government and academia on the right policies required to be implemented,” he added.
The UNCTAD official also called for reforms in the education sector so that graduates produced are matched to current market demand.
He said that currently there is a deficit of relevant skills that are required to transform the continent into an economic giant.
In order to catalyze the e-commerce trade, UNCTAD and the Africa Union have jointly organized the First UNCTAD Regional eCommerce week that will take place from Dec. 10 to 14 in the Kenya capital city of Nairobi.
Under the theme “Empowering African economies in the digital era”, the conference will examine the ways to enhance the ability of African countries to engage in and benefit from e-commerce and the evolving digital economy.
Kituyi said that the forum will offer a targeted program for policymakers from African countries and other stakeholders to identify innovative ways for shaping the African digital economy.