Abstract
The larger metropolitan area of Cape Town is a hub for services in information and communications technology (ICT). Considering the development opportunities related to this sector, this chapter explores the nature and dimensions of the South African ICT sector and within it, the one in Cape Town. Based on desk studies, including a detailed assessment of statistical information and an in-depth analysis of four firms, the author analyses how the South African ICT sector integrates into value chains on various geographical scales. He also sheds light on the challenges that Cape Townian ICT firms face in expanding their operations—access to finance and markets, for example—and suggests that there is much potential for these firms in expanding into Africa at large.
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Notes
- 1.
These trade patterns can be verified by using data from an online portal such as: http://www.trademap.org.
- 2.
An angel investor, also known as a business angel or seed investor, is an affluent individual who provides capital for a business start-up, usually in exchange for convertible debt or ownership equity.
- 3.
FICA deals with money laundering and tax evasion and FAIS with consumer protection on insurance products. Both increase the regulatory compliance burden with regard to payments processing, especially international payments.
- 4.
ICASA is a regulatory body in the communications sector. It has been accused of gross inefficiency and poor management practices. POPI prescribes much stricter requirements for the management of online personal information.
- 5.
Providers of SAAS sell a continually beneficiated application platform to clients. For example, Windows 10 is such a product. Its licensing rights include regular beneficiation of the operation system application. An API is a software tool that allows clients to develop their own software modules to uniquely access and manipulate the data marketed by the service provider.
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Acknowledgements
This research presented here benefitted from funding by the United States Agency for International Development, provided via the Trade Law Centre in Stellenbosch. The author would like to thank Sören Scholvin for commenting on draft versions of this chapter.
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Stuart, J. (2019). A Hub for Africa? The Information and Communications Technology Sector in Cape Town. In: Scholvin, S., Black, A., Revilla Diez, J., Turok, I. (eds) Value Chains in Sub-Saharan Africa. Advances in African Economic, Social and Political Development. Springer, Cham. https://doi.org/10.1007/978-3-030-06206-4_15
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