PC shipments to East Africa plummet

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The Rand isn’t the only emerging market currency  getting a kicking; the currencies of east African countries Kenya, Ethiopia, Tanzania and Uganda are so weak right now that they’ve impacted the number of PCs being imported into those countries by a disastrous average of 24.8 per cent.

The International Data Corporation (IDC) has published a report which states that PC shipments to those countries are down to just 108 088 as of Q3 2015.

“Given the region’s reliance on imports, the ongoing depreciation of local currencies is driving greater inflationary risks and subsequently depressing consumer sentiment and purchasing power,” the IDC said in an email statement.

Ethiopia suffered the worst decline of the four, with a drop of 36.7 per cent year on year.

“The monetary tightening policies undertaken by the region’s governments have been a partial success,” says James Mutua, a senior research analyst at IDC East Africa.

“However, these measures have not been able to reverse the ongoing currency declines, largely because this weakness is being driven by external factors such as the strong U.S. dollar, expectations of U.S. monetary tightening, uncertainties in the euro zone, and slower growth in China.”

Adding pressure to the situation is the influx of gray imports to the region coming from the United Arab Emirates. IDC says this always happens ahead of GITEX – the Gulf Information Technology Exhibition – that takes place in Dubai.

These cheap items are dumped into Africa, IDC says, because distributors in the UAE attempt to clear their inventories of older stock that isn’t selling well in preparation for GITEX, which they do with the help of tax loopholes in those four countries that mean local distributors are unable to compete.

IDC concludes that “Rather than bringing in the much-touted additional revenues, the taxes on PCs appear to be promoting off-channel business and strangling the revenue-generating potential of official channels.”

So yes, countries in east Africa are having a turbulent time of it at the moment, so South Africa is not alone in its economic troubles.

[Source – IDC, Image – T. Forrester]



Deon du Plessis

Deon du Plessis

Deon got his first taste of PC gaming at the tender age of 11 when his father bought an 8088 XT, ostensibly to "help him with his homework". Instead, it introduced him to Leisure Suit Larry, King Graham, Sonny Bonds and many more, and Deon has been a PC gamer and hardware enthusiast ever since. He landed his first professional writing gig in 2006 at a prestigious local PC magazine, a very happy happenstance as he got to write for a living about things he loves - tech, PCs, gaming, and everything in between. He's been writing about it all ever since, and loves every minute of it.