• The IMF’s next index detailing which countries are the most ready to embrace generative AI suggests that South Africa is the most ready on the African continent.
• The index ranks readiness in four areas: digital infrastructure, human capital and labour market policies, innovation and economic integration, and regulation.
• Lower-income countries will struggle to harness the benefits of AI, but they will face disruptions at a slower rate.

Out of all countries in Africa, South Africa is believed to be the nation that is most ready to embrace generative AI across society. At least according to a new index published by the International Monetary Fund (IMF).

The index ranks AI preparedness ranks how ready a region is for the adoption of AI in four areas: digital infrastructure, human capital and labour market policies, innovation and economic integration, and regulation. The closer the index is to 1.0 the more ready a country is for AI to be embraced in these areas.

South Africa ranks 0.5, with the second-closest being Tunisia at 0.47, then Kenya at 0.45, then Rwanda, Ghana, Botswana, and Namibia. The Central African Republic and South Sudan rank with the lowest AI readiness at 0.18 and 0.11 respectively.

“Our research has already shown how AI is poised to reshape the global economy. It could endanger 33 percent of jobs in advanced economies, 24 percent in emerging economies, and 18 percent in low-income countries,” the IMF says.

“But, on the brighter side, it also brings enormous potential to enhance the productivity of existing jobs for which AI can be a complementary tool and to create new jobs and even new industries.”

The fund says that most emerging market economies and low-income countries, like many African countries, will likely face fewer disruptions from AI, but these countries also lack the infrastructure or skilled workforce necessary to really harness the power AI and its benefits.

“Wealthier economies tend to be better equipped for AI adoption than low-income countries,” it explained, adding that this could worsen inequality among nations.

“Under most scenarios, AI will likely worsen overall inequality, a troubling trend that policymakers can work to prevent,” the IMF explains.

“For policymakers, those in advanced economies should expand social safety nets, invest in training workers, and prioritize AI innovation and integration. Coordinating with one another globally, these countries also should strengthen regulation to protect people from potential risks and abuses and build trust in AI.”

Meanwhile, the IMF says that emerging markets should instead lay a strong foundation by investing in digital infrastructure and digital training for workers. We can see then that South Africa, as an emerging economy, is taking this advice. Digital skills and the digital transformation of companies is a big priority for a lot of businesses, as evidenced in our AI in Business survey.

South Africa is on the right track to harness the power of AI, but what it needs now is strong legislation to protect jobs and improve equality.