Africa’s video game market has been doing well. According to Newzoo, in 2022, the game revenue sold in the region will be US$862.8 million, an increase of 8.7% year-on-year.

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Africa’s video game market is booming.

The games industry in sub-Saharan Africa is expected to generate more than $1 billion in revenue for the first time in 2024, according to data shared exclusively with CNBC.

The figures, compiled by Dutch research firm Newzoo for African gaming startup Carry1st, show that Africa’s gaming market is booming, but economic growth has been slow as the region faces persistent inflation, dire financial conditions and high net debt.

Economic growth in Sub-Saharan Africa falls from 4.1% in 2021 to 3.6% in 2022, According to World Bank data. It is expected to decline further to 3.1% in 2023.

Despite this, the video game market in Africa has been doing well. According to Newzoo, in 2022, the game revenue sold in the region will be US$862.8 million, an increase of 8.7% year-on-year.

This ignores a broader contraction in global video game activity as tailwinds from the coronavirus lockdown fade and rising costs of living force consumers to tighten their belts.

According to Newzoo’s data, the global game market revenue will be US$182.9 billion in 2022, a decrease of 5.1% from 2021.

Cordel Robbin-Coker, chief executive of Cape Town-based Carry1st, said what’s most notable about these figures is the “potential long-term growth of the gaming market in sub-Saharan Africa”.

“Looking back, we know that COVID-19 was a big factor,” Robin-Cock said. “But now that those benefits have faded, we’re starting to see slower or even lower growth in other markets.”

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“We have the fastest-growing population in the world,” he added. “People are going online very quickly for the first time. Most of it (more than 90%) is on their mobile phones. The demand for content is very strong.”

Konvoy, a venture capital firm focusing on game-related investments, said that the African game industry is expected to grow by 15.7% in 2023 and 13.6% in the following year, higher than the previous forecast of 9.23% and 8.95% growth.

“Preliminary figures for gaming on the continent are encouraging, but long-term trends in population growth, internet penetration and smartphone adoption paint a picture of incredible growth for gaming on the continent,” said Jackson Vaughan, managing partner at Konvoy. NBC Company Finance Channel.

The proliferation of smartphones, in particular, has boosted gaming prospects in Africa. The region’s higher-than-normal youth population means digital technologies are strongly welcomed.

According to mobile industry body GSMA, 87% of sub-Saharan Africa’s population will own a smartphone by 2030, up from 51% in 2022.

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This is thanks in large part to falling smartphone prices and the growth of “digital native” users.

African gaming market outpaces global

The global gaming industry is expected to return to growth this year, with analyst firm Ampere Analysis forecasting growth of 3.3% in 2023, driven by a “return to some form” of mobile gaming.

But that’s a far cry from the rapid growth seen in 2020 and 2021, when the coronavirus pandemic forced people to stay home and give people more free time to play games.

Louise Shorthouse, analyst at Ampere Analysis, said: “Future platform privacy changes could disrupt user acquisition, combined with broader audiences being less adaptable to changing macroeconomic conditions, meaning mobile gaming Market behavior has become less predictable than in the past.”

In Africa, the growth of gaming is largely driven by the use of smartphones.

According to Newzoo, mobile game revenue will be $778.6 million in 2022, accounting for about 90% of total game sales.

Nigeria led the way in terms of annual gross gaming revenue, attracting $249 million, followed by South Africa, which generated $236 million.

According to Newzoo, South Africa was previously the largest video game market in Africa.

The next highest earning countries were Kenya ($46 million), Ethiopia ($42 million) and Ghana ($34 million).

Ethiopia had the highest year-over-year growth rate at 13%, while Uganda had the slowest growth in the games market at just 6%.

According to Newzoo, Nigeria and South Africa earn twice as much as the other eight major countries combined. Sales were up year-over-year in all 10 countries.

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