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How Africa Can Tap into its E-commerce Potential

While Africa has a vast e-commerce potential, experts consider this opportunity largely untapped. A report released last year by the International Trade Centre (ITC), a development agency that supports small- and medium-sized enterprises, found that 10 countries were responsible for 94% of all online business in Africa in 2019. The paper offers insights to policymakers and entrepreneurs alike. Based on data and analysis available in ITC’s ‘Africa Marketplace Explorer’, an online analytical tool available to all, the research is supplemented by data on Africa’s e-commerce ecosystem and case studies of the largest African marketplaces. Online marketplaces are the dominant form of e-commerce for consumer goods in developed countries. They are also prominent across Africa, offering great potential to serve a new generation of consumers and open opportunities for small entrepreneurs. But little is known about these marketplaces in Africa: where they are growing, where they are struggling and why. E-commerce businesses in the continent mainly engage in the business-to-business (B2B) and business-to-consumer (B2C) models. B2B involves transactions between businesses, for example between a manufacturer and wholesaler, or a wholesaler and a retailer. In B2C, on the other hand, a business sells a service or product directly to a consumer.