A Conceptual Policy Framework for Leveraging Digitalization to Support Diversification in Sub-Saharan Africa

Author/Editor:

Mame Astou Diouf ; Leonardo Pio Perez ; Felix F. Simione ; Arina Viseth ; Jiaxiong Yao

Publication Date:

June 21, 2024

Electronic Access:

Free Download. Use the free Adobe Acrobat Reader to view this PDF file

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary:

The need for Sub-Saharan African (SSA) countries to diversify their economies is more urgent than ever. However, despite its established economic benefits, several challenges have precluded diversification in SSA. Against this backdrop, interesting initiatives to further adopt digital technologies, particularly during the COVID-19 pandemic, suggest that digitalization is a promising avenue to overcome barriers to diversification. Fast-paced advances in the diffusion of digital technologies and knowledge have the potential to transform SSA economies through several channels. By connecting people and facilitating the rapid diffusion of information, digitalization also promises to reshape the industrial structure of activities in new and unprecedented ways. Therefore, digitalization has the potential to promote diversification and growth in SSA by acting both as an enabler and driver of economic activities, helping support resilience. Yet, while the empirical literature on SSA suggests that digitalization can provide new opportunities for growth, employment, productivity, and inclusion, the impact on diversification has not been studied. This paper aims to fill this important gap in the literature. It also aims to strengthen IMF engagement with SSA policy makers by providing a conceptual policy framework, encompassing both horizontal and sectoral policies, on how to leverage digitalization to support diversification and boost resilience in a post-COVID world.

Series:

Working Paper No. 2024/123

Subject:

Frequency:

regular

English

Publication Date:

June 21, 2024

ISBN/ISSN:

9798400279638/1018-5941

Stock No:

WPIEA2024123

Format:

Paper

Pages:

27

Please address any questions about this title to publications@imf.org