Innovation as a catalyst for growth

Policymakers all over the world are now emphasizing on innovation as one of the drivers of economic growth in an economy.  Innovation as drivers of Economic Growth already proved its credibility in developed countries and now it’s time for developing countries to follow suit.

Based on general classification two important types of Innovation include product innovation and Process innovation. Product innovation is the introduction of a good or service that is new or has significantly improved characteristics or intended uses. A process innovation refers to the implementation of a new or significantly improved production or delivery method.

Evidence from firm innovation surveys suggests that the firms with a product or process innovation provide a competitive advantage to them over their competitors.

Some popular product innovations include mobile phones, ballpoint pen, laptops etc. Process innovations include additive manufacturing or 3-d printing. It’s a new way of manufacturing parts by printing them three-dimensionally using fine powder or liquids.

Over the past few years new technological innovations are shifting and transforming countries in Africa. Smart young entrepreneurs, developers and programmers have sprung up in innovation hubs, accelerators and incubators centres around the continent to build information and telecom solutions that exploit the continent’s blend of challenges and opportunities.

Each year, the number of technology hubs across Africa is rising and new technology is changing the way all sectors do business. From healthcare to education, agriculture to business, technology has changed it all.

Rwanda

African Union Science, Technology and Innovation Strategy for Africa (STISA) 2024 seek to accelerate the transition of African countries to innovation-led and knowledge-based economies. In Rwanda National Research and Innovation Fund was launched to support the implementation of local innovations as well as research for development in the country. Priority sectors for research and innovation included energy clean technology and energy access solutions, smart transport and logistics, e-commerce, agri-tech, digital health, medical and technology devices, inclusive finance tech, and education technology.

According to UNCTAD report, over past few years Rwanda has emerged as one of Africa’s more innovative economies. “Rwanda’s innovation efforts in promoting high-tech sectors, such as ICTs and life sciences, are commendable. However, their outcomes will only be sustainable if improvements are made to innovation performance in the more mundane but essential activities that form the economic backbone of industry and agriculture,” the report says.

Rwanda is doing a commendable job in boosting innovation but it must encourage the use of technology and innovation in other sectors beyond information and communication to sustain its high economic growth.

Innovations and  Africa

Some important innovations among African countries include mobile phone app innovation called Nappi Daddi helping fathers of young children become more involved in a child’s early care and development.

 E-Voucher involving the use of electronic vouchers by Zimbabweans cash-strapped small scale farmers’ access agricultural inputs.

 E-Wallet helping Nigerians farmers to receive subsidized electronic vouchers for inputs to their mobile phones allowing them to purchase seeds and fertilizers and other tools related to agriculture from agri-traders.

MLouma app connects Senegal farmers to food purchasers by displaying real time market prices, products and localizations.

ESoko TradeNet  in Ghana allows farmers to collect data and get advice on market prices, weather forecasts, and growing tips to help them increase their yields and profits.

Farmerline uses voice and SMS to collect data, share new farming techniques, and better link smallholder’s farmers to other actors along the agricultural value chain across Ghana.

Mobile AgriBiz of Kinshasa is a mobile app with web and  SMS application that helps farmers decide when and how to plant crops, how to select the best crops for a given location using climate and weather data.

Community Surveillance Project helping fishing communities in Sierra Leone fight against illegal, unreported and unregulated fishing through the use of mobile phones.

M-Pesa which is financial sector  Kenya based innovation designed to allow microfinance-loan repayments by phone and reducing interest rates, this mobile phone-based money transfer.

All these innovations have enhanced the efficiency of the economy and actors involved in using them. Most of these are product innovations are linked to enhancing agricultural efficiency.

There is a lot of prospects for innovation in the manufacturing sector including both product and process innovation in African economies. It is high time to concentrate on combination of product and process innovation to achieve self-sufficiency and efficiency in the manufacturing sector.

Recommendations

There is no doubt that innovations are important but it is important to understand the priority areas where we need innovation. Countries have limited resources and they need to be utilized in the right direction to maximize the usage and utility for society.

Policy makers have to prioritize areas which need support for innovation so that strategy will be formulated for financial and technical support needed for the same. Also, there is a need for formulating innovation base curriculum in critical areas to enhance capacity where there are gaps.

The writer is a Kigali based economist and consultant.

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