Africa must significantly ramp up investments in digital infrastructure if it hopes to connect more people and businesses to the internet, according to a new report from the International Finance Corporation (IFC). The development finance institution estimates the continent needs to double its annual spending to $6 billion to deploy vital fiber optic cables from coastal landing points to cities and homes inland.

“The $6 billion is just the capital expenditure of building out that digital infrastructure. It doesn’t include the costs of operating it,” stated Susan Lund, IFC’s Vice President of Economics and Private Sector Development. While an improvement over previous years, the World Bank’s $2.8 billion commitment to digital projects in sub-Saharan Africa over the past decade has barely scratched the surface.

The IFC, a member of the World Bank Group, aims to take its total investment in the continent to around $10 billion by the end of 2024 and double that amount the following year. A significant portion will go towards supporting innovative companies helping drive digital adoption across various industries.

The urgency stems from an IFC survey of firms in 54 African countries that found most small businesses are not realizing the full benefits of internet access. Only 5% of firms with fewer than five workers have internet-connected computers in major economies like Ethiopia, Ghana, Kenya, Nigeria, South Africa, and Uganda.

Many of these small and medium enterprises (SMEs) are located in areas without high-speed fiber infrastructure or lack affordable smartphones for digital payments. As such, the IFC estimates a further $2.7 billion is required to assist these firms in digitizing their operations, particularly in manufacturing and agriculture where digital tools could boost productivity.

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The report highlights the arrival of around 30 new submarine cables providing hundreds of terabits of internet capacity as a positive step. However, the costly challenge remains in transmitting that connectivity inland to population centers where it can be accessed by businesses and individuals.

With SMEs accounting for 70% of Africa’s 400 million-strong workforce, helping these enterprises get online is critical not just for economic growth but ensuring job security for millions on the continent. As the digital divide persists, the IFC’s call to double down on infrastructure spending underscores Africa’s pressing need to keep pace with global technological change.