According to the World Bank, Sub-Saharan Africa’s economic growth rate dropped from 4.1% in 2021 to 3.6% in 2022. And it is anticipated to decrease even more in 2023, to 3.1%.
The Sub-Saharan African video games market is expected to generate more than $1 billion for the first time in 2024, according to information given to CNBC.
The data, gathered by Dutch research firm Newzoo for African gaming startup Carry1st, demonstrates that there is a healthy market for gaming in Africa, where economic growth has lagged as a result of the continent’s struggles with persistent inflation, challenging economic conditions, and high net debt.
According to the World Bank, Sub-Saharan Africa’s economic growth rate dropped from 4.1% in 2021 to 3.6% in 2022. And it is anticipated to decrease even more in 2023, to 3.1%.
In spite of this, the video games market in Africa has been doing well. According to data from Newzoo, $862.8 million was made in revenue from games sold in the area in 2022, an 8.7% increase from the previous year.
That stands in opposition to a global decline in video game activity as COVID lockdowns lose their impact and consumers cut back due to rising costs of living.
Newzoo estimates that the global games market generated $182.9 billion in sales in 2022, a 5.1% decline from 2021.
The most noteworthy aspect of the data, according to Carry1st’s chief executive officer Cordel Robbin-Coker, is the “underlying secular growth in the games market in sub-Saharan Africa.”
Looking back, COVID was a significant contributor, according to Robbin-Coker. But now that those advantages have subsided, we are beginning to observe a slowing or even a decline in growth in other markets.
Particularly, the uptake of smartphones has improved Africa’s gaming prospects. Since there are more young people than usual in the area, digital technology has been widely adopted.
According to the mobile industry trade group GSMA, 87% of people in sub-Saharan Africa will own a smartphone by 2030, up from 51% in 2022.
Ampere Analysis, an analytics company, predicts that the global gaming market will grow again this year and by 3.3% in 2023 as a result of mobile gaming “returning to some form.”
However, it is a far cry from the explosive growth of 2020 and 2021, when the coronavirus pandemic drove people indoors and gave them more time to play video games.
According to Louise Shorthouse, analyst at Ampere Analysis, “the potential for disruption to user acquisition from future platform privacy changes, plus a wider audience less resilient to changing macroeconomic conditions, means that mobile gaming market performance has become less predictable than in the past.”
Mobile device use in Africa was a major factor in the growth of games.
90% of all game sales, or $778.6 million, were made through mobile gaming in 2022, claims Newzoo. Nigeria was first with $249 million in yearly gaming revenue. With $236 million, South Africa came in second place.
Newzoo stated that South Africa used to be the continent’s biggest market for video games. Kenya ($46 million), Ethiopia ($42 million), and Ghana ($34 million) were the next three revenue-producing nations.
Ethiopia experienced the highest year-over-year growth, at 13%, while Uganda had the slowest growth in the games market, at 6%. Nigeria and South Africa produced twice as much revenue as the next eight nations combined, according to Newzoo. Each of the ten countries saw an increase in sales year over year.