E-Commerce Set to Contribute R91.4 Billion to South Africa’s Economy by 2035,

A new report by Naspers and the Mapungubwe Institute for Strategic Reflection (Mistra) projects that e-commerce could add R91.4 billion to South Africa’s economy by 2035. The report, titled “Our Digital Horizon: The Economic Opportunity of Digital Platform Businesses in SA,” outlines the anticipated growth of the digital platform economy, which is expected to increase its contribution to South Africa’s GDP from 0.02% in 2022 to 1.38% by 2035.
The report highlights that this growth will be driven by a stable macroeconomic environment, increased smartphone and broadband penetration, and the rising adoption of electronic transactions. Despite this positive outlook, South Africa has yet to fully capitalize on its digital economy potential. The country is a prominent player in Africa’s digital market, alongside Kenya and Nigeria, but still faces challenges in realizing its full digital potential.
The report identifies several factors that hinder the growth of the digital platform sector in South Africa. These include limited income levels, skills gaps, and a shortage of venture capital, which restrict platform expansion primarily to urban niche markets. While categories such as classifieds and accommodation have seen broad adoption, sectors like e-commerce and fintech face difficulties due to income constraints and market limitations.
Despite these challenges, there is notable growth in on-demand services and increasing venture capital investment in sectors such as agriculture, healthcare, and education. Naspers, which operates major entities in South Africa including Media24, MultiChoice, Mr D, and Takealot, has already contributed over R13 billion to the economy, including R1.5 billion in household income based on 2022 data.
Reshaping the Economy
Joel Netshitenzhe, Mistra’s Executive Director, emphasized the transformative impact of digital platforms on various sectors. “Businesses that were previously constrained by market access can now reach a global audience through digital platforms. Emerging farmers, for example, can access essential resources and markets through a single platform. The potential is boundless,” he said.
Phuthi Mahanyele-Dabengwa, CEO of Naspers South Africa, described the report as a “pivotal moment” for the country. “The transition to digital is still in its early stages, but it reflects global trends and offers a significant opportunity to unlock economic potential,” she noted.
Trade, Industry, and Competition Minister Parks Tau welcomed the report, viewing it as a catalyst for collaboration between business and the public sector. “The digital economy is a crucial driver of global growth, innovation, and service delivery. This report will help us harness its full potential for South Africa,” he said.
Tau also highlighted the importance of digital skills and infrastructure in unlocking the benefits of the digital platform economy. He stressed the need for a supportive policy environment to promote innovation and economic inclusion, ensuring that South Africa can compete effectively in the digital economy.
Global E-Commerce Trends
The global e-commerce market is projected to reach $4,117 billion in revenue by 2024, with an annual growth rate of 9.49% expected to increase this to $6,478 billion by 2029. China leads the market with a projected revenue of $1,469 billion this year. User numbers are expected to grow to 3.6 billion by 2029, with user penetration reaching 49.1%, up from 40.5% in 2024. Average revenue per user is estimated at $1,620.
As South Africa navigates its digital transformation, the insights from this report will be crucial in shaping the country’s approach to harnessing the economic opportunities presented by the digital platform economy.