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Incentives for Digital Economy Production in Cameroon

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By Achare Takor, Douala, Cameroon

Over the last decade, information technologies (IT) have revolutionized the way people and businesses carry out their daily activities worldwide. There is abundant evidence that the upsurge of technology has been a major contributor to fundamental economic change, notably the growth in global production and the distribution of intangible goods and services. As a result, the digital economy has become the new focus for economic growth in developing countries.

With ICT set to become the engine of development in Cameroon in its role as a hub in the Central Africa sub-region, the 2021 tax scheme has been updated to promote innovative ICT start-ups. Eligibility for the benefits of the start-up promotion scheme is subject to the consent of Approved Management Centres dedicated to start-ups. The specific obligations of the Approved Management Centres shall be specified by instrument issued by the Minister in charge of finance.

ICT start-ups whose status is confirmed by an approved management centres will be eligible to claim several incentives:

 a) During the incubation phase, which must not exceed 5 years, companies which fall under this category shell be exempt from all taxes, duties, levies and payments, except social security contributions.

b) At the end of the incubation phase, in the event of the sale of the start-up, a reduced capital tax gains rate of 10% – instead of the standard 16.5% – will be applied to the increase in the value of investments through the lifespan of ownership.

c) If the company enters the operation phase at the end of incubation, it shall, for a period of five (5) years, benefit from:

– exemption from the business licence tax,

– exemption from registration fees on the incorporation, extension or capital increase instruments,

– exemption from all tax and employer’s charges on salaries paid to their employees except social security contributions,

– application of a reduced 5% rate of income tax on movable capital revenue on dividends paid to shareholders and interest paid to investors.

 At the end of the fifth year of operation, ordinary tax law policies will become applicable. The development of dedicated policy to support ICT start-ups signals commitment from the Cameroon government to development of the digital economy. If implemented properly, these tax incentives should attract investment to Cameroon.

Secondary benefits of these policies include an increase in employment, capital transfers, research and technology development, and structural development in less-developed areas. Although it is difficult to approximate the value of these tax incentives in general, proper implementation is likely to improve overall economic welfare through increased economic growth and government tax revenue.

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How MTN’s Endorsement Changed 17-year Davido’s Musical Career

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Davido’s reputation as “Omo baba Olowo” (son of a rich man) has never been in question but even the wealthy have been known to enjoy a financial boost from time to time. The Afro-pop star revealed he received his big boost as a teenager when telecommunications giant, MTN Nigeria came calling with a N20 million naira endorsement deal.  

“I remember when MTN, a telecommunication company, came, and they were like they want to do endorsement, but then he (Dad) was like how much, and I said 20 million. I was like I’m 17. Nobody (had) seen that kind of money. Wow, this is from music, and it’s off like two songs, of course.”

Davido further explained that the deal came at the right time as it proved to be the incentive needed to convince his multi-billionaire father, Dr Adedeji Adeleke of the potential in the music business.

“I’m like, ‘Daddy see, we can do this’. “He built me a studio and gave me some money to run my stuff and did my first album, and it came out really really successful.”

Davido was the face of MTN Pulse between 2012 and 2016 and during that time the pop star dropped hit songs like Aye, Skelewu, and Gobe to mention a few whilst picking up a number of awards along the way.

Davido has since risen to become one of Africa’s biggest musical export, selling out various venues across the world including the O2 Arena in London, performing at the 2022 FIFA World Cup in Qatar, earning billions of streams across multiple platforms and collaborating with some of the world’s biggest artistes. He recently released his fourth studio album “Timeless” which peaked at number 2 on the World Album charts.

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ITU Targets $100bn By 2026 To Accelerate Global Digitalization

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The International Telecommunication Union (ITU) issued yesterday a worldwide appeal calling to increase the value of pledges for digitalizing the world from the current $30 billion to $100 billion by 2026. 

The appeal by the United Nations specialized agency for information and communication technologies includes a focus on raising the level of resources for universal and meaningful connectivity and digital transformation in the world’s least developed countries (LDCs). 

The announcement of the target was made on World Telecommunications and Information Society Day, observed annually to mark the signing of the first International Telegraph Convention and ITU’s founding in 1865. 

ITU secretary-general, Doreen Bogdan-Martin, “Tech is at the top of the global agenda, but the benefits of digital technology are still out of reach for too many people,” said “If we are serious about digitalizing the world in a way that is meaningful and sustainable, we must take action to accelerate digital transformation for everyone.” 

In 2023, ITU’s anniversary is focused on empowering the least developed countries through information and communication technologies using the Partner2Connect Digital Coalition and its online pledging platform. 

The ITU appeal to the public and private sectors encompasses a campaign launched in February 2022 by Partner2Connect to mobilize direct funding or other contributions for connectivity projects in countries registering the lowest on development.

Of the $30 billion already pledged overall, Partner2Connect has identified commitments worth $12 billion to bring the LDCs online as quickly as possible.   

The United Nations defines LDCs as countries that have low levels of income and face severe structural impediments to sustainable development. The call for resources, which comes as the UN strives to rescue its Sustainable Development Goals (SDGs) by 2030, stresses the need for the globe’s digital transformation to be environmentally friendly. 

“The digital revolution is a defining force of our era,” said United Nations Secretary-General António Guterres. “As the Internet becomes ever more central to value creation and innovation, least developed countries risk falling further behind. We must dramatically improve accessibility and inclusivity and eliminate the digital divide.” 

According to ITU data, 2.7 billion people worldwide were offline in 2022. The digital connectivity divide separating the least developed countries from the rest of the world is widening on key factors such as access, digital skills and affordability. 

Though the globe’s 46 least developed countries are home to almost one-third of the world’s offline population, the Internet is considered to be affordable in only two of those countries. 

At the event marking ITU’s anniversary in Geneva, ITU Secretary-General Bogdan-Martin announced SDG Digital Day, scheduled for 17 September in New York in advance of the UN SDG Summit to review the 17 Sustainable Development Goals.

The SDG Digital Day, powered by ITU on behalf of the UN system, will showcase high-impact, sustainable, digitally based solutions that have a game-changing potential to accelerate progress on the SDGs. 

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SmartParcel Introduces Tech-driven Parcel Delivery Service across Nigeria

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SmartParcel, Nigeria and Africa first innovative logistics parcel solution provider has began deployment across strategic locations in Lagos and across Nigeria.

The co-founder/COO of the company, Benjamin Adeyemo spoke during the opening of the Lagos Island Smart Locker locations at Mandilas Building and Andora Best Shopper Mart on Broad Street.

He said, “Businesses and individuals on the Island and across Nigeria now have a new, easy to use, and convenient delivery service powered by smart and innovative technology.”

Adeyemo noted that the easy-to-use solution aims to solve logistics and delivery challenges by creating seamless, smart lockers positioned in strategic locations where users can send and receive items meant for them.  

“The first step is to download the SmartParcel app on Google PlayStore or Apple store. Sign up to get your unique Locker code. The depositor will then use the code to deposit his/her item in the Locker. SmartParcel will then assign a trusted rider to pick up and deliver the item at the recipient closest or preferred SmartParcel collection centre.

 “he recipient gets an instant notification when after the rider drops the parcel at the SmartParcl Locker. The depositor also gets an alert after the parcel is collected by the recipient. Adeyemo further said that the businesses on Lagos Island will enjoy a maximum of 12 hours delivery circle,” he added.

Speaking at the launch, a business owner, Aisha, who uses the service said, she discovered “I discovered SmartParcel at VGC. I downloaded the app “Smartparcelng” and I was signed to the service within minutes. I contacted my client and told him about the SmartParcel locker which coincidentally happened to be very close to his house and he was able to retrieve his item easily just by using the code.”

SmartParcel currently has location partnership with NIPOST that allows this innovative service to be enjoyed by all Nigerians across the 774 local government areas of the country.

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