Senegal's ecommerce sector helps country cope with COVID-19

Originally published by UNCTAD on 24 April 2020

Trade ministry fast-tracks measures to ease access to essential goods and services during the pandemic.

As the coronavirus pandemic rages, several brick-and-mortar businesses in Senegal are moving online to continue operating.

The government is facilitating this transition and the delivery of essential supplies by fast-tracking the implementation of ecommerce policies and reforms.

The country’s trade ministry has created an ecommerce platform that provides easy access to websites of small and medium-sized enterprises (SMEs) that sell essential goods.

The platform facilitates the distribution of necessary food, hygiene and health products, federates the SMEs and encourages more traditional businesses to go online.

“We want to ensure people have access to the things they need to ride out this crisis,” said Senegalese Trade Minister Assome Aminata Diatta. “We are also developing an ecosystem favourable to ecommerce and local production.”

“We commend the Senegalese government for taking steps that are helping pave the way for the country’s digital transition,” said Shamika N. Sirimanne, Director of UNCTAD’s technology and logistics division.

Wide range of operators

The ecommerce platform created by the Senegalese government has attracted a wide range of operators.

So far, about 60 businesses have either joined or shown an interest in joining the platform. They range from firms providing ecommerce, logistics and payment solutions to those helping entrepreneurs set up ecommerce operations.

“We’d like to help businesses reach consumers in all the major urban centres, especially beyond Dakar, where current ecommerce services are concentrated,” said Ibrahima Diagne, Chief Executive Officer of Gainde2000, the company that helped create the platform.

The platform now serves as an information portal with contact details of various ecommerce operators, but it’s aimed at pooling and optimizing goods distribution by creating a national consortium of ecommerce operators, open to all producers and merchants.

“For this to happen, businesses have to move from a purely competitive mindset to a cooperative one. They should be willing to share a common marketplace infrastructure that benefits the whole ecommerce ecosystem,” Diagne said.

Besides the ecommerce platform, the trade ministry has launched a second platform to support its market monitoring activities through online mapping of available stocks of essential foodstuff across the country.

Implementing assessment recommendations

UNCTAD’s eTrade readiness assessment of Senegal conducted in 2018 recommended, among other measures, getting ecommerce businesses actively engaged in a public-private dialogue, especially in the development of national and regional ecommerce strategies.

In response, the Senegalese government launched a national ecommerce development strategy in December 2019, supported by the Enhanced Integrated Framework.

It also created the National Council for Digitalization, which guided the development of the strategy in collaboration with an ecommerce working group that handles the country’s participation at the World Trade Organization. The work enhanced policy coordination.

The government’s implementation of other recommendations of the assessment has resulted in improved internet connectivity and affordability, thanks to reforms and more open markets, as well as private investments by telecom operators and internet service providers.

Ramping up measures

Further, Senegal is revising its legal framework and has drafted a personal data protection bill for parliamentary review. It’s also rolling out new e-government initiatives such as Smart Senegal, a quest to use digital technology to enhance socioeconomic development.

The use of mobile money services has boomed and fintech firms are actively promoting new solutions that aggregate different e-payment platforms.

However, more needs to be done to enhance the interoperability of different platforms, particularly between banking and mobile money operators.

The government is also supporting information, communication and technology (ICT) and business process outsourcing firms to become export-ready and access export markets for services.

It’s doing so through the implementation of an ad-hoc strategy, assisted by the International Trade Centre and funded by the Netherlands.

In addition, digital startups are thriving and are slated to benefit from a tax exemption scheme introduced by a new law, which entered into force in January.

Building on the achievements

UNCTAD is supporting the Senegalese government to build on its achievements and strengthen the country’s ecommerce development agenda.

It’s mobilizing a wide range of development partners, particularly eTrade for all partners, to spearhead the implementation of the national ecommerce development strategy and other recommendations of the assessment conducted in 2018.

They include updating and improving ICT and ecommerce data on users and transactions to enhance the government’s capacity in designing evidence-based policies affecting the sector.

Other priority steps are establishing full interoperability of e-payment solutions and rolling out a massive sensitization and communication campaign on the benefits and risks associated with ecommerce.

UNCTAD will continue to support the development of the Senegalese ecommerce sector and digital economy, a critical lever for economic growth and recovery from the COVID-19 crisis.

-----------

Originally published by UNCTAD here.