Following a successful digital revolution, Estonia – a small Baltic state considered today as one of the most technologically advanced countries in the world – exports its digital know-how abroad and seeks to strengthen its cooperation with various actors, including Africa. What are the ingredients of its success? How could the continent benefit from this collaboration? Mari Hanikat, CEO of Garage 48, sheds some light on this issue for Kapital Afrik.
By Kapital Afrik
Financial Afrik: Estonia is considered as the most technologically advanced society in Europe. Can you briefly explain how Estonia’s digital revolution occurred?
Mari Hanikat: After regaining the independence in 1991 Estonia had to set up the government and the economy from scratch. Having been occupied by the Soviet Union for 50 years the country was among the poorest in Europe with no natural resources to tap on to. So, the new generation that took power came to realize, that digital is the only sphere where Estonia was on an equal start square with the rest of the world. The Tiger Leap project was implemented to bring computers, internet access and basic IT skills to as many people as possible, via schools, libraries, public internet stations. The second crucial step was the introduction of the compulsory digital ID in 2002. This was developed in public private partnership of the government, commercial banks and telcos which ensured a wide uptake and rapid growth of services. The digital ID enabled secure identification of users and is based on the X-road infrastructure which means all service providers have access to the digital identification but do not store personal data of users. Also crucial – the citizens own their data and can check any time if someone has looked into their data. Based on the secure digital id Estonia introduced digital voting in 2005.
How it impacted the economy?
M.H.: The rapid digitization helped to set up a very modern banking system, the Tiger Leap program inspired young people to choose careers in IT, so the whole sector has demonstrated the fastest growth of all. The founding of Skype by Estonian engineers in 2003 and even more so their exit had a major impact on the start-up environment. The success story of four guys starting a business out of a working-class apartment was an inspiration for a whole generation while the founders also invested a lot of their exit funds into new start-ups and created a lively angel investment network. Early Skype people went on to found new companies, among them several unicorns.
What do you think Africa can learn from the Estonian example?
M.H.: Access to affordable internet is vital and will serve as a great equalizer, of course it requires government support and control to reach that. Creating a secure digital ID is the foundation of digital governance and helps to improve transparency of the society. Estonia is among the least corrupt countries of the world today and this is widely associated with the digital governance.
Africa is currently witnessing a digital transformation. What are your observations on the continent’s innovation, especially in regards to the socio-economic challenges posed by the COVID-19 crisis?
M.H.: The pandemic has made some of the gaps even more visible and has highlighted the need to bridge them. Of course, lots of it comes down to having a good infrastructure supporting elements in place such as electricity, water and internet, but lots of it is already there. Africa is catching up fast. Almost half of the Africans own a form of an ID-card, which makes it easier to adapt the e-governance practices as well.
On February 9, the Ministry of Foreign Affairs held a virtual event to present Estonia’s regional strategy for Africa for 2020-2030, which seeks to strengthen its cooperation with the continent, especially in the digital field. What can your country bring to the States of the continent in this particular sector?
M.H.: Estonia is perhaps most known for its good e-services and great e-governance practices. This has also become our biggest export article, that is appealing to many African countries, moving towards more digital governance practices. So, if we could make it, our experience and lessons should be valid and usable for Africa as well. That being said, we do realize that Estonia is a tiny country, and Africa is a huge continent that consists of 54 unique countries, each facing different problems on their own. Regardless, we do feel that our background is more relatable and transparent than for lots of the other bigger European countries – some of them sharing the colonial background with different parts of Africa.… Perhaps this is also one of the reasons, why it is easier to relate with us
What would be the benefit for African startups?
M.H.: With the adaption of new technologies, new doors open and there will be more different ways for the creative minds to solve problems. Africa has plenty of tech-talent, who is in some cases already way ahead of what the continent has to offer. By bringing in more of the already existing solutions and practices and adapting them, new opportunities open and new jobs are created.
In an interview published by the IMF, former President of Estonia, Toomas Hendrik Ilves, mentioned that “it was innovative policy more than technology that enabled Estonia’s remarkable digital transformation.” Do you think the same approach should be applied in the African digital transformation context?
M.H.: Yes, the technology has to be robust, not cutting edge. It’s the mindset that matters more. The solutions that have created the biggest leap in Estonia are not the ones technologically most advanced, but rather those that are well tested and weather-proof.
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