The AI race and its growing impact on Africa

The race in artificial intelligence (AI) is heating up, with global players like OpenAI and China's DeepSeek making significant strides in the field. Africa, despite being largely dependent on foreign AI models, is starting to feel the direct impacts of this technological revolution. According to a study by PricewaterhouseCoopers, AI could contribute approximately $15.7 trillion to the global economy, with $1.3 trillion of that potential benefitting Africa. To delve deeper into this topic, CNBC Africa's Tabitha Muthoni spoke to Elemi Atigolo, an expert in Generative AI specializing in its application in finance and the Managing Partner with Consult Venture Partners. The conversation with Elemi shed light on the opportunities and challenges that AI brings to Africa. One key opportunity highlighted was the potential for AI to bridge the language barrier. Companies like OpenAI and Meta are collaborating with Orange to train language models to understand African dialects like Wolof, opening doors for more tailored AI solutions in the region. Additionally, models like DeepSeek R1 with their reasoning capabilities, being open source, present an opportunity for Africa to leverage advanced AI technologies to drive innovation and growth specific to the continent's needs. The economic potential of AI in Africa is substantial, with projections suggesting a significant boost in various sectors such as finance, entrepreneurship, and agriculture. Companies are already utilizing AI to streamline financial processes, enhance business operations, and even optimize agricultural practices. The influx of investment, particularly from Western investors, into African AI and fintech startups like Len and Fee, underscores the growing interest and potential for AI-driven growth on the continent. Financial inclusion, a critical issue in Africa, stands to benefit significantly from AI advancements. AI technologies can revolutionize credit access by utilizing unconventional data sources like mobile usage, utility payments, and social media to assess creditworthiness. Startups like Ewari, focusing on developing language models for African languages, are paving the way for broader financial inclusion by making financial services more accessible in native languages. However, amidst the opportunities, there are concerns about Africa's overreliance on foreign AI models like OpenAI and DeepSeek. This dependency poses the risk of perpetuating biases and overlooking Africa's unique cultural and linguistic diversity. To foster local AI innovation, governments and stakeholders must support initiatives that develop indigenous AI models tailored to Africa's specific needs. Collaboration with Western organizations and leveraging open-source models can facilitate the creation of AI solutions that are both powerful and culturally sensitive to the region. In addressing the regulatory challenges, African governments must strike a delicate balance between fostering innovation and ensuring ethical AI deployment. Learning from global examples like Europe's AI regulation framework, African policymakers need to implement policies that safeguard against AI misuse while nurturing a conducive environment for AI innovation to thrive. The journey towards unlocking the potential of AI for Africa's economic growth and innovation is still unfolding. As the AI race accelerates, Africa stands at a critical juncture to harness the power of AI while navigating the complexities of regulation, local innovation, and economic transformation.