E-commerce priorities in Africa.

Iyanuoluwa Bolarinwa.

To start with, what is E-Commerce?

E-commerce, also known as electronic commerce or internet commerce, refers to the buying and

selling of goods or services using the internet, and the transfer of money and data to execute these transactions. E-commerce is often used to refer to the sale of physical products online, but it can also describe any kind of commercial transaction that is facilitated through the internet.

Whereas e-business refers to all aspects of operating an online business, e-commerce refers specifically to the transaction of goods and services.

The history of e-commerce begins with the first ever online sale: on August 11, 1994, a man sold a CD by the band Sting to his friend through his website NetMarket, an American retail platform. This is the first example of a consumer purchasing a product from business through the World Wide Web — or “e-commerce” as we commonly know it today.

Since then, e-commerce has evolved to make products easier to discover and purchase through online retailers and marketplaces. Independent freelancers, small businesses, and large corporations have all benefited from e-commerce, which enables them to sell their goods and services at a scale that was not possible with traditional offline retail.

Global retail e-commerce sales are projected to reach $27 trillion by 2020.

Having defined what E-commerce is all about, we need to also look into what digital trade, Data Protection, Privacy and Consumer Protection also means for Africa.

E-commerce, Digital Trade, Data protection, Privacy, Consumer Protection,

Digital trade is the fuel for E-commerce which allows free flow of buying and selling on the internet, this particular topic has driven a lot of concerns bearing on the side of data exchange and how Africa seem to be on the disadvantaged side. This takes us to Data protection, what is data protection? as we know, protecting customers personal data, thereby not putting them at risk of phishing or loosing very vital information they have entrusted e-commerce platforms with. It best to note right now that, Developing countries, including many in Africa, stand on the precipice of a digital divide from which it can be difficult to contemplate the beneficiaries of digital trade as being any other than the most developed countries. There is a fear of distribution, whereby in affected countries there are feelings that the skilled labourers will be more favoured over the unskilled labourers. Nigeria has it stands today has been able to bring even the non-skilled labourers to sell on the prominent e-commerce platforms, this has really helped to create a nexus for both.

In addition, there are concerns that digital trade embodies network effects that can lead to market concentration and in turn lead to anti-competition issues. For instance, large e-commerce platforms such as Amazon — which accounts for half of all online expenditure in the US — collect vast amounts of increasingly valuable data on their customers. This data can then be used to outcompete smaller rivals which lack access to such data. This can lead not only to serious anticompetitive threats but also to high market concentration in developed countries.

It's important to also note that in Nigeria and most of the west African countries there is concern that digital trade may better allow international companies to distort their taxable income through transfer pricing. For instance, if the intellectual property and operating expertise behind cross-border e-commerce are located abroad, then the cost of this may be deducted from locally generated sales to reduce taxable income in their own countries.

Consequently, what does the growth of the digital economy imply for the export-oriented industrialisation strategy that has historically fuelled many countries’ development? New technologies, like 3D printing and increased automation, reduce demand for labour-intensive manufacturing. Some worry that these technologies will reduce the incentives for businesses to invest in manufacturing in low-labour-cost developing countries — a phenomenon traditionally at the heart of many countries’ industrialisation.

However, we must note that there are priorities for Nigeria which is well included in its Nigeria’s Economic Recovery and Growth Plan for 2017–2020. The purpose of this plan is to increase and maintain inclusive growth through a structural transformation and diversification of Nigeria’s economy. The priorities to note are

1. Streamlining trade procedures.
2. Establishing a market-driven and fully floating foreign exchange rate regime
3. Addressing governance weakness and regulatory uncertainties
4. Combating insecurity
5. Modernizing Infrastructure
6. Access to reliable and accessible electricity

All listed above are the priorities all businesses need to thrive in Nigeria and its well noted. However, the Nigerian trade negotiators don’t really go deep into resolving issues that are bothering around e-commerce in Nigeria, there is a belief that, it just has to do with buying and selling online. Well, there have been very strong voices from civil society groups and non-state actors to give a voice to the priorities that need to be taken into serious consideration. It must be duly noted that because of lack of deep understanding the trade negotiators (NOTN) smuggled Nigeria into friends of E-commerce group for development at the MC11 in Argentina. It is important to note that, Nigeria still lacks a policy to effectively drive the global needs that will keep its citizens safe on the e-commerce platforms. Talking about the priorities that are needed for Nigeria. They are addressed below.

1. Identification of strategies for e-commerce readiness
2. Access to ICT infrastructure and services
3. Trade logistics and trade facilitation
4. E-payment solutions
5. Legal Certainty
6. Regulatory frameworks
7. Capacity building
8. Technical assistance
9. Access to finance
10. Data Privacy

All of these priority listed above are very important before any trade treaties are signed on behalf of Nigeria. However, we have signed some, but then, we need to put forward these conditions as to make sure the interests of the citizens are well protected. We need to deal with policy gaps that abound and how we can mitigate through continental and multilateral negotiations using the instrumentality of the AFCTA phase 2 negotiations and the ongoing WTO framework agreements on the E-commerce and digital trade.