Bespoke digital public-private partnership would transform SA’s investment attractiveness

SA needs to leapfrog to a digital solution that solves one of its most fundamental problems: validly documenting the existence of citizens

“The future of African economies and the opportunities available for its young people will depend, in large part, on patterns of investment.” So says the Financial Times in the lead-up to its Africa Summit, to be held in London on Tuesday, October 18.

The Financial Times also recognises that investing in Africa’s digital future is critical. But situated at the pointy end of our continent, the race for the digital future of Africa needs to be better understood here at home. Despite stage 6 load-shedding, despite rising violent crime, despite political uncertainty, it might shock the despondent to know there’s much that can be done to make SA an attractive investment haven. And it starts with leapfrogging to a digital solution that solves one of SA’s most fundamental problems: validly documenting the existence of citizens.

It’s a fool’s errand to expect government alone to seamlessly design and implement an effective digital identity programme. The only way that we can achieve this is for the private and public sector to work together to deliver access to all citizens for their unique digital identity. This would unlock huge growth potential and safeguard essential services such as welfare, banking, healthcare, tax collection, education and so much more to enable better freedom of movement and access to inclusive growth fundamentals.

Countries such as India have already had huge success in transforming parts of their population based on digital vetting. There, the first Unique ID, popularly known as the Aadhaar biometric system, was generated on September 29 2010. Just over 12 years later, by July 2022, 1.3-billion Aadhaar numbers had been generated and issued to the residents of India. That means nearly 93% of India’s vast population are uniquely captured and identified on a safe system that gives them access to a range of public and private services. Though there are some critical improvements still to make, it’s widely credited as being India’s foundational identity platform on which all other digital services have been built and are flourishing.

The so-called Indian “digital stack” of essential digital components include electronic know your client (eKYC), digital signatures (eSign), and electronic payment platforms like Rupay and eRupi. These and more have created an enabling and facilitative environment for other digital services to emerge and investments to flow.

If this were to be adopted in SA it could significantly change how citizens engage with the state and one another. Some of the universal benefits would include a modernised public service with enhanced privacy, confidentiality, trust and information security. Business and tax registration would be streamlined, making it easier to start and run a business — and account to the fiscus for its success.

Civil processes would be more co-ordinated, with less risk of human error and exploitation. Labour productivity would increase, as would citizens’ overall confidence in the state. It would also increase fraud prevention, decrease identity theft and support a secure purchasing environment. All of these factors would contribute to stabilising SA’s backbone ability to offer a stable growth environment for inclusive investing.

And with the reality of our bruised economy, the example of Estonia is instructive in how SA can turn its battered reputation around on a tight budget. In 1991, when Estonia gained independence from the Soviet Union, it was essentially bankrupt. It had no budget to buy or develop highly sophisticated systems. So its cabinet, comprising young and amateur politicians, took a bold approach. Instead of striving to update existing but barely functioning systems, Estonia’s leaders took on the impossible: building most institutions from scratch, on virtually no budget, and in a short space of time.

What these tight parameters meant though was that a small, highly motivated group of individuals in the public and private sector were forced to work together to deliver huge results. And as impossible as it sounds to SA ears, these teams reported that the key to building an accountable system that can combat risks of corruption was a vulnerable sharing of trust in one another. Their trust was built on a shared sense of civic duty, renewed after the gaining of independence, and the need to build a stable state to welcome investment and ex-patriots home.

In the 30 years since independence Estonia has completely turned around the future of its people. With a GPD per capita in 1991 of $100 per person, to a GDP per capita in 2021 of $22,986, it’s clear they are succeeding. Every interaction an Estonian has with the state is transacted digitally, aside from marriage and divorce.

In our work with various government agencies and private sector leaders, what is absolutely not lacking across the board is the will to develop a modern, digitalised civil service. What we are lacking is a clear plan to achieve this. SAtion is engaging at the highest levels to develop a robust, safe, corruption-free and resilient citizen digital identity regime. We need to trust one another to create a safe and enabling relationship in which we can share our collective skills and expertise for a digitalised African investment haven. Our time is now.


• Craker is CEO and Grimmer programme director at SAtion, SA’s largest digitalisation NPO.

Image source: 123RF/EverythingPossible

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