Growth spurt for online economy

According to a maiden study, “Internet Matters: The Quiet Engine of the South African Economy“, the sector’s contribution to the country’s gross domestic product (GDP) is rising by about 0.1% each year and it has the potential to become a major economic growth engine.

The study, released this week by World Wide Worx, an independent technology research and strategy organisation, was commissioned by Google South Africa and is the first in-depth analysis of the local internet economy.

Consumers, small and medium enterprises and the government spent a total of R59-billion last year on products and services through the internet, as well as on internet access and infrastructure. Government spending on infrastructure and access accounted for just over  R1-billion of this amount.

Putting this in context, the agricultural sector accounted for only 2.2% of GDP in the last quarter of 2011.

Growing
“It is likely that, over the next five years, the internet economy will begin approaching the size of the construction sector, an estimated R120-billion in 2011,” said Arthur Goldstuck, managing director of World Wide Worx.


The investment in bre and other data infrastructure by the cellphone networks amounted to R13.5-billion, but it was far surpassed by the amount spent on internet presence and access – R29.2-billion.

E-commerce is also growing at a rate of about 30% a year. Airline e-ticketing is a notable presence in this market and online sales totalled close to R9-billion last year.

Research showed that 410 000 small and medium-sized businesses in South Africa had a website, representing 63% of active formal enterprises. An estimated 150 000 businesses, accounting for about 1.5-million jobs, would not be able to survive without their web presence.

The research indicated that 40-million South Africans used phones – a large percentage of which are smartphones – which represents the future potential of internet growth.

Subscribe to the M&G

These are unprecedented times, and the role of media to tell and record the story of South Africa as it develops is more important than ever.

The Mail & Guardian is a proud news publisher with roots stretching back 35 years, and we’ve survived right from day one thanks to the support of readers who value fiercely independent journalism that is beholden to no-one. To help us continue for another 35 future years with the same proud values, please consider taking out a subscription.

Related stories

Advertising

Subscribers only

How lottery execs received dubious payments through a private company

The National Lottery Commission is being investigated by the SIU for alleged corruption and maladministration, including suspicious payments made to senior NLC employees between 2016 and 2017

Pandemic hobbles learners’ futures

South African schools have yet to open for the 2021 academic year and experts are sounding the alarm over lost learning time, especially in the crucial grades one and 12

More top stories

Zuma, Zondo play the waiting game

The former president says he will talk once the courts have ruled, but the head of the state capture inquiry appears resigned to letting the clock run out as the commission's deadline nears

Disinformation harms health and democracy

Conspiracy theorists abuse emotive topics to suck the air out of legitimate debate and further their own sinister agendas

Uganda: ‘I have never seen this much tear-gas in an...

Counting was slow across Uganda as a result of the internet shutdown, which affected some of the biometric machines used to validate voter registrations.

No way out for Thales in arms deal case, court...

The arms manufacturer has argued that there was no evidence to show that it was aware of hundreds of indirect payments to Jacob Zuma, but the court was not convinced.
Advertising

press releases

Loading latest Press Releases…