Canalys: Africa's smartphone expansion slows, projected at 1% for 2025

Africa's smartphone market is facing challenges as growth rates slow down, with Canalys projecting a cautious 1% growth in smartphone shipments for the year 2025. The latest research data from Canalys shows that the African smartphone market grew by 3 percent year-on-year in the third quarter of this year, reaching 18.4 million units. Despite this growth, there are concerns about the sustainability and future expansion of the market, prompting a need for sustained efforts to unlock its potential. Egypt emerges as a success story in the region, leading in local production that has reduced import reliance significantly. The country has managed to slash its smartphone import bill by 99% to 1.65 million, stabilizing smartphone pricing locally. This trend sets an example for other African countries to follow in localizing production and stabilizing prices. However, the report highlights weaknesses in the Nigerian and South African markets. Nigeria, the second-largest market after Egypt, recorded a modest 1% growth due to currency depreciation and high import dependence. The Naira's depreciation of almost 70% and high inflation rates have impacted consumer demand and smartphone imports. With 99% of mobile phones being imported, Nigeria struggles with high smartphone prices, making them inaccessible to many consumers. The emergence and success of feature phones have also impacted smartphone expansion. Feature phones account for 55% of the total mobile phone market, with consumers preferring them for their affordability. While smartphones remain out of reach for many due to higher prices starting at around $75, feature phones priced as low as $8 continue to attract buyers. The report predicts that 4G penetration will continue in the next few years, with entry-level smartphones supporting 4G connectivity and 5G adoption lagging due to pricing challenges. Vendors in the African smartphone market have faced a mix of opportunities and challenges. Samsung has experienced market decline, while Transsion maintains its market share with 8% growth, driven by ITel offerings catering to the low-price segment. Xiaomi and Realme have seen growth by offering value-for-money smartphones appealing to younger consumers. Honor's market presence is growing, supported by programs like YES Program and Port of Honor in South Africa. The focus on 4G and 5G adoption is gaining momentum in Africa, with resources shifting towards expanding connectivity. While some countries are moving towards 5G, the high cost of smartphones remains a challenge for widespread adoption. Governments and operators are investing in 4G infrastructure to drive digital transformation and enable more consumers to access online services. Despite the potential for growth, Canalys projects a cautious 1% growth in smartphone shipments for 2025. Factors such as high import taxes, fluctuating currencies, and inflation contribute to this slowdown. Consumers are prioritizing essential needs over smartphone purchases, impacting demand. Addressing these challenges and fostering a favorable environment for smartphone adoption will be crucial for the sustained growth of the African smartphone market.