Africa may be in the headlines because of civil wars and diseases, but few people notice the world's poorest continent is now experiencing an unprecedented growth in the mobile industry.

In the first few years into the new millennium, the African mobile industry has become "a success story" as it adds more mobile users than in the whole of the previous century and witnessed an average growth rate of 64 per annum, the fastest in the world, officials said Wednesday.

By the end of 2004, mobile users are estimated to have skyrocketed to 65 million from 15 million in 2000, said Ernest Ndukwe, vice chairman of the Nigerian Communications Commission in Lagos, Nigeria's commercial capital.

This can stimulate Africa's economic growth and provide "the launch pad for African countries toward the process of transition to information societies and knowledge economies," he said.

"The success ... has also demonstrated that innovation and reforms are important pre-requisites for development and that poor governance and bureaucratic lethargy are major causes of underdevelopment."

Ndukwe explained the major driver for the growth has been the wave of market reform introduced in many African countries since 2000 which allows competition in the mobile market.

Competition alone is not the key. The emergence over the past five years of African based, pan-regional mobile operators such as South Africa's MTN, is another significant reason behind mobile's growth, analysts said.

As Africa's telecoms investment climate has shifted, in turn, potential investors are beginning to drop their skepticism about venturing into the troubled continent, they said.

Vendors, looking to grow in new markets as they face saturation elsewhere, are increasingly tailoring their approach to the region, developing special lower-cost solutions to suit the needs of the region.

This is why so many global players in the telecom sector streamed into Lagos Wednesday for the three-day West African International Telecommunications and Information Communications Technology Exhibition.

Indeed, organizers said they were "deeply touched" by fantastic interest shown by companies who desperately wanted to exhibit but cannot find space at the Eko Hotel, the venue of the exhibition, simply because they booked late.

Nigeria, Africa's most populous country, has set a good example as to government policy of market liberalization and competition in the mobile industry.

"There is no doubt that in spite of our initial setback, Nigeria today has a rapidly growing teledensity, evidenced by the fact that ... today we have over 12 million lines (including 11 million mobile lines)," the country's Communications Minister Cornelius Adebayo told reporters Wednesday.

In 1999, Nigeria had only 400,000 connected telephone lines and just 25,000 analogue mobile lines.

"You many be aware that by 1999 the volume of FDI (foreign direct investment) in the telecom sector stood at 50 million dollars, but today, we make bold to say that the level has exceeded 8 billion dollars," Adebayo said.

Corruption and telecom monopoly, however, are still denying many African countries access to investment that could have been available to the sector, Ndukwe said.

"Another major growth inhibitor has been the inadequacy of transmission backbone infrastructure across the continent," he said.

Other growth inhibitors include duty rates, unreliable electric power supply and dearth of reliable statistical information and data for planning.

For example, "in Nigeria, the subscriber growth rate has been far beyond the predictions and most of the operators achieve the five year projections with two years of operation," said Ndukwe.

On the other side, despite tremendous growth already witnessed in the African mobile industry, analysts and experts believe there still exists a lot of potential for growth in African countries as only about eight percent of Africa's 840 million people own phones.

"A lot of work still needs to be done to sustain the momentum to ensure full mobile coverage of the continent and position Africa to take advantage of convergence of technologies and services now available on the mobile platform," Ndukwe stated.

Source: Xinhua