• Amazon Web Services (AWS) released a new report looking at the impact that cloud adoption is expected to have in South Africa.
• By 2033, AWS says cloud adoption will result in a near R4 trillion boost to the country’s economy.
• The increased cloud adoption is also predicted to lead to a significant decrease in carbon emissions.

Today Amazon Web Services (AWS) made a return of sorts, with the company hosting its first in-person AWS Summit for some time in South Africa. Unlike previous years, Johannesburg played host for the event, as AWS highlighted the impact that cloud adoption is expected to have in SA over the coming decade.

To that end, AWS commissioned a study carried out by by Telecom Advisory Services LLC, and directed by Raul Katz, director of Business Strategy Research at the Columbia Institute for Tele-information.

Here, the report says that the South African market has the potential to unlock an estimated R3.9 trillion of additional economic value over the next decade. This would represent 4.05 percent of South Africa’s cumulative gross domestic product (GDP), signalling what the accelerated adoption of cloud is anticipated to bring forth.

Looking at recent years, the report highlighted that, “In 2021, cloud adoption made a significant impact on the South African economy. According to the report, it contributed 0.18% to the regional GDP, generating an economic value of ZAR14,3 billion. Over 78% of this impact can be attributed to the national productivity gains or so-called ‘spill over effects’ on the economy. The remaining 22% is driven by cloud spending from both public and private organisations.”

“On average, South Africa experienced a 0.06% increase in GDP for every 1% increase in cloud penetration. It was found that South Africa has the highest economic growth due to cloud adoption in sub-Saharan Africa (SSA), with 1% increase in cloud penetration yielding 0.06% increase in GDP growth, three times more than the SSA average,” it added.

Utilising the data in the report, researchers predict that if there was a 10 percent increase in cloud penetration across the entire Sub-Saharan Africa region, it would result in economic spill over effects amounting to an staggering estimate of R71.9 billion per year.

“Until recently, research on the economic impact of cloud was focused at the firm-level, understanding the microeconomic benefits associated with cloud adoption (for example, capital efficiency, contribution to product development, and the like). These studies, while valuable, did not quantify the aggregate effect of cloud on the economy in a similar way to what has been done in areas such as broadband Internet,” pointed out Katz.

Looking at the data through a new lens, it looks like showcasing the untapped value that comes with cloud adoption and penetration are two key areas of focus for AWS moving forward.

“This report underscores the immense potential for South Africa, and the SSA region, to harness cloud computing and expedite economic growth. By increasing the current average cloud penetration, the region can unlock additional economic value,” noted Amrote Abdella, GM for Sub-Saharan Africa at AWS.

“AWS is committed to supporting its customers and partners in South Africa throughout their cloud journey. We firmly believe that cloud technology will be crucial in driving innovation, boosting productivity, and scaling businesses in the region over the next decade,” she continued.

Along with the economic boost over the coming decade, the report highlighted four other areas where cloud adoption will have an impact, with one of them being sustainability. This is something that almost every technology company is pondering of late, with AWS too laying out an objective to reach net-zero carbon emissions in its operations by 2040.

Looking at the four areas that will be enhanced by cloud adoption, AWS explained in a press release sent to Hypertext that, “First, it enhances business efficiency and effectiveness, streamlining processes and improving outcomes; second, it offers access to a wide range of services, enabling businesses to leverage advanced technologies; third, it boosts productivity by facilitating collaboration, mobility, and agility within the workforce; fourth, cloud computing promotes environmental sustainability by reducing carbon emissions per unit of data transmitted.”

“With the current forecast, the economic impact of the cloud is undeniable and is poised as a key catalyst for economic prosperity. As such, it is important for businesses in the region to invest in cloud computing technology to stay competitive and boost their economic potential,” concluded Abdella.

To read the report in full, head here.