Zanzibar, the group of islands known for its sandy beaches and tourism resorts, has spent the last year making a concerted effort to reinvent itself as a global tech hub for African startups and digital natives.
But it also now looks like the archipelago could also become a hub of academic excellence as pan-African and international universities consider Zanzibar for the same reasons startups and others might find it an attractive prospect.
The African School of Economics (ASE) this week became the latest organization to set up shop in Zanzibar under the ‘Silicon Zanzibar’ initiative launched in September 2022. The pan-African university established in Benin in 2014 opened a new campus with a special focus on tech, aiming to incubate companies and develop tech talent in Zanzibar. It will collaborate with Princeton University and the Indian Institute of Technology (IIT) Madras to offer STEM and social science courses.
Professor Leonard Wantchekon, founder and president of ASE, told Semafor Africa that the Silicon Zanzibar initiative played a “pivotal role” in its decision as it explored expansion options. “While we have made inroads into West and South Africa, Zanzibar emerged as the preferred destination for our inaugural expansion into East Africa, due to its alignment with our vision, the huge support from the government, and the local business partnerships,” he said.
The Zanzibar Startups Association stated in October that 180 companies had expressed interest in investing in tech in Zanzibar. The most prominent company to have set up shop in Zanzibar under the Silicon Zanzibar initiative so far is B2B commerce startup Wasoko, ranked Africa’s fastest growing company in 2022 by the Financial Times. Others include Tanzanian e-procurement startup Ramani and Kenyan e-commerce platform Tushop.
Zanzibar is in the early stages of showing that the right incentives can lure tech investment and talent outside of the traditional big African markets. The dominance of markets such as Kenya, Nigeria, South Africa and Egypt will be challenged as more countries eye tech dollars. Countries with heavy tax burdens for startups could lose out as companies explore different options. Zanzibar is offering tax and immigration benefits — including exemption from corporate tax for 10 years and work visas for relocating tech workers.
And with its strong tourism offering, the semi-autonomous region may also prove to be a top destination for global digital nomads and remote tech workers looking for a mix of business and pleasure.
“Since the launch of the (Silicon Zanzibar) initiative, we’ve had over 100 companies and organizations reach out to express interest in setting up local operations,” Wasoko CEO Daniel Yu told Semafor Africa. “As a founding partner of Silicon Zanzibar, we’ve been able to engage productively with the Zanzibari government to provide direct input on implementing new policies to attract as many tech companies to the islands as possible.”
Notably, the entry of educational institutions including ASE and the Indian Institute of Technology (IIT) Madras will help create a stronger talent pipeline to support growth of Zanzibar’s tech ecosystem.
Wantchekon predicted that ASE’s presence will be a boost for African scientists and tech researchers and pointed out that his institute was also keen on increasing Africa’s contribution to global research.
Room for Disagreement
Africa’s tech sector has experienced a meteoric rise in the past decade but growth remains concentrated in a handful of markets — with Nigeria, South Africa, Kenya and Egypt leading the pack. Nearly three quarters of African startups which have raised a million dollar round since 2019 are located in these four markets, according to startup funding database Africa: The Big Deal.
25 countries in Africa haven’t recorded a single million dollar deal since 2019.
Disrupting the dominance of these established African tech hubs will be a tall order not just for Zanzibar but other African countries building up their tech ecosystems — such as Ghana and Tunisia which witnessed record-breaking funding in 2022.
The View From India
The Indian Institute of Technology (IIT) Madras opened its first overseas campus in Zanzibar in October, with an initial intake of 70 students in two data science and artificial intelligence (AI) programs. It was the first IIT to open a campus outside india. IITs are elite engineering schools in India known for low acceptance rates and numerous alumni who have gone on to senior tech roles in India and around the world. Its high profile graduates include Alphabet CEO Sundar Pichai, IBM CEO Arvind Krishna, and Raj Subramaniam, CEO of FedEx.
Zanzibar is hoping IIT Madras will have a similar impact for the region, by developing talent that can propel its tech ecosystem forward.