Equatorial Guinea Equatorial Guinea Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC © 2024 The World Bank 1818 H Street NW, Washington, DC 20433 Telephone: 202-473-1000; Internet: www.worldbankgroup.org Some rights reserved. 1 2 3 4 21 20 19 18 This work is a product of the staff of the World Bank with external contributions. The findings, interpreta- tions, and conclusions expressed herein do not necessarily reflect the views of the World Bank, its Board of Executive Directors, or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of the World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. 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Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC TABLE OF CONTENTS ACKNOWLEDGEMENTS 1 ACRONYMS AND ABBREVIATIONS 2 EXECUTIVE BRIEF 7 EXECUTIVE SUMMARY 11 INTRODUCTION 24 EQUATORIAL GUINEA AND ITS NASCENT DIGITAL ECONOMY 24 AFRICA’S DIGITAL TRANSFORMATION 32 THE WORLD BANK’S DIGITAL ECONOMY FOR AFRICA INITIATIVE 35 1 | DIGITAL INFRASTRUCTURE 39 1.1 | IMPORTANCE 39 1.2 | DIAGNOSTIC FINDINGS: CURRENT STATE OF DIGITAL INFRASTRUCTURE 40 1.3 | DIGITAL INFRASTRUCTURE RECOMENDATIONS 60 2 | DIGITAL PUBLIC PLATFORMS 63 2.1 | IMPORTANCE 63 2.2 | DIAGNOSTIC FINDINGS: CURRENT STATE OF DIGITAL PUBLIC PLATFORMS 63 2.3 | DIGITAL INFRASTRUCTURE RECOMENDATIONS 83 3 | DIGITAL FINANCIAL SERVICES 87 3.1 | IMPORTANCE 87 3.2 | DIAGNOSTIC FINDINGS: CURRENT STATE OF DFS 88 3.3 | DFS RECOMENDATIONS 109 4 | DIGITAL BUSINESSES 112 4.1 | IMPORTANCE 112 4.2 | DIAGNOSTIC FINDINGS: CURRENT STATE OF DIGITAL BUSINESSES 113 4.3 | DIGITAL BUSINESSES RECOMMENDATIONS 132 iv Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC 5 | DIGITAL SKILLS 137 5.1 | IMPORTANCE 137 5.2 | DIAGNOSTIC FINDINGS: CURRENT STATE OF DIGITAL SKILLS 138 5.3 | DIGITAL SKILLS RECOMMENDATIONS 155 CONCLUSIONS 162 REFERENCES 166 ANNEX 1 | SUMMARY OF RECOMMENDATIONS 171 ANNEX 2 | HIGH-LEVEL TARGETS OF THE DE4A INITIATIVE 186 @ ra2 studio / Shutterstock v Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC ACKNOWLEDGEMENTS This report was prepared by the World Bank team led by Camila Mejia Giraldo (Senior Dig- ital Development Specialist) and comprising the following members: Samuel Ruben Alexan- der Garoni (Governance Specialist, Chapter Lead for Digital Public Platforms); Olivia-Kelly Lonkeu, (Financial Sector Specialist, Chapter Lead for Digital Financial Services); Elena Puche Palao, (Chapter Lead for Digital Businesses); Martin Elias De Simone (Education Specialist, Chapter Lead for Digital Skills); and Amadou Makhtar Fall (Digital Development Specialist, Chapter Lead for Digital Infrastructure). The team also included Ivan Gonzalez Berenguer (Consultant) and Belen Rodriguez Martinez (Digital Development Analyst). The report was prepared in in close collaboration with colleagues from the International Finance Corporation (IFC), led by Marcos Vaena (Senior Strategy Officer). Valuable guidance was provided by Tania Begazo (Senior Economist), Jean Michel Lobet (Senior Financial Sector Specialist), Heriniaina Andrianasy (Senior Public Sector Specialist), Steisianasari Mileiva (Social Protection Specialist), and Alessandra Heinemann (Senior Social Protection Specialist). The team is grateful to the peer reviews of the report: Daniel Nogueira-Budny (Senior Digital Development Specialist), Ida S Mboob (Senior Digital Development Specialist), Maimouna Gueye (Senior Financial Sector Specialist) and Antonio Manuel Baptista (Senior Private Sector Specialist). Comprehensive national stakeholder consultations were undertaken in preparing and final- izing the document. The team would like to express their sincere gratitude to all government and private sector organizations in Equatorial Guinea for their insights and generous coop- eration during the drafting of this report. Funding by the Digital Development Partnership (DDP) is gratefully acknowledged. Report editing: Ellen Cooper and Mikel Alcazar (Cristaliza Global). Report translation: Oliver Davidson, Rocio Benavente and Mikel Alcazar (Cristaliza Global). Report design, layout & graphics: Jesus Rivero (Cristaliza Global). 1 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC ACRONYMS AND ABBREVIATIONS AAUCA Afro-American University of Central Africa ACE Africa Coast to Europe Digital Agenda for Equatorial Guinea (Agenda Digital Guinea Ecuatorial) ADIGE  AfCFTA African Continental Free Trade Area AfDB African Development Bank ATM Automated Teller Machine BANGE Banco Nacional de Guinea Ecuatorial BEAC Bank of the Central African States Autonomous Public Debt Amortization Fund (Caja Autónoma de Amortización CAADP  de la Deuda Pública) CAR Central African Republic CDMA Code Division Multiple Access CEMAC Economic and Monetary Community of Central Africa Centro Nacional de Emisión de documentos oficiales de Guinea Ecuatorial CNEDOGE  CET Girls in Technology (Chicas en Tecnología) CIP Payment Incident Center (Centrale des Incidents de Paiement) National Economic and Financial Committee (Comité Nacional Económico y CNEF  Financiero) CNTTDT Commission for the Transmission of Terrestrial Digital Television National Center for the Computerization of the Public Administration CNIAPGE  of Equatorial Guinea (Centro Nacional para la Informatización de la Administración Pública de Guinea Ecuatorial) COBAC Banking Commission for Central Africa CRVS Civil Registration and Vital Statistics DAI Digital Adoption Index DE4A Digital Economy for Africa DFS Digital Financial Services 2 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DLT Distributed Ledger Technologies DMFAS Debt Management and Financial Analysis System DTT Digital terrestrial TV EGDI E-Government Development Index EIGRP Enhanced Interior Gateway Routing EMIS Education Management Information System EQG Equatorial Guinea FAS Financial Access Survey FTTH Fiber-to-the-Home FSP Financial Service Provider G2B Government-to-Business platforms G2G Government-to-Government platforms G2P Government-to-Population Gbps Gigabytes per second GDP Gross Domestic Product Telecommunications of Equatorial Guinea (Guinea Ecuatorial Comunicaciones GECOMSA  Sociedad Anónima) Equatorial Guinea of Posts and Telecommunications (Guinea Ecuatorial de GECOTEL  Correos Telecomunicaciones) GER Gross Enrollment Rate Telecommunications Inc. of Equatorial Guinea (Guinea Ecuatorial de GETESA  Telecomunicaciones SA) GIMAC Interbank Electronic Banking Group of Central Africa Telecommunications Infrastructure Managing Company of Equatorial Guinea GITGE  (Gestor de Infraestructuras de Telecomunicaciones de Guinea Ecuatorial) GNI Gross National Income GoEG Government of Equatorial Guinea 3 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC GSM Global System for Mobile communication Special Group Mobile Association (Groupe Spéciale Mobile Association) GSMA  HRM Human Resource Management HRMS Human Resource Management System ICT Information, Communication and Technology ID4D Identification for Development IEA International Energy Agency IFMIS Integrated Financial Management IFC International Finance Corporation IMF International Monetary Fund National Institute of Public Administration (Instituto Nacional de INAP  Adminsitración Pública) National Institute of Statistics of Equatorial Guinea (Instituto Nacional de INEGE  Estadística de Guinea Ecuatorial) INPYDE National Institute of Promotion and Development National Institute of Social Security (Instituto Nacional de Seguridad Social) INSESO  IPCC Inter-Governmental Panel on Climate Change IRENA International Renewable Energy Agency ISP Internet Service Provider ITU International Telecommunication Union ITV Vehicle Inspection Service IXP Internet Exchange Point Kbps Kilobits per second KYC Know Your Customer LTE Long Term Evolution Mbps Megabits per second Ministry of Education and Science (Ministerio de Educacion y Ciencia) MEC  MINASIG Ministry of Social Affairs and Gender Equality MoF Ministry of Finance MSME Micro Small and Medium Enterprises 4 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Ministry of Transport, Post and New Information and Communications MTCT  Technologies NOFN National Optical Fiber Network OECD Organization for Economic Co-operation and Development OHADA Organization for the Harmonization of Business Law in Africa Telecommunications Regulatory Body (Órgano Regulador de las ORTEL  Telecomunicaciones) P2P Peer to Peer PAMFP Public Finance Modernization Support Project Democratic Party of Equatorial Guinea (Partido Democrático de Guinea PDGE  Ecuatorial) PE Private Equity PKI Public Key Infrastructure PoS Point of Sale Education Development Program of Equatorial Guinea (Programa de PRODEGE  Desarrollo Educativo de Guinea Ecuatorial) QoS Quality of service RGI Resource Governance Index RIO Reference Interconnection Offer RTGS Real Time Gross Settlement System RUS Unique Social Registry (Registro Social Único) SAIL South Atlantic Inter Link SDG Sustainable Development Goal Electricity Society of Equatorial Guinea (Sociedad de Electricidad de Guinea SEGESA  Ecuatorial) Computer System of the Civil Registry (Sistema Informático del Registro Civil) SIREC  SME Small- and Medium-size Enterprise SMP Significant Market Power SOE State-Owned Enterprises SSA Sub Saharan Africa STEM Science, Technology, Engineering, and Math 5 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Automated Bulk Lift System (Système de Gros Montants Automatisé) SYGMA  Telecompensation System in Central Africa (Système de Télécompensation en SYSTAC  Afrique Centrale) Technical and Vocational Education and Training TVET  UAE United Arab Emirates University of Madrid for Distance Learning (Universidad a Distancia de UDIMA  Madrid) UI User Interface UNSD United Nations Statistics Division UNCTAD United Nations Conference on Trade and Development UNDP United Nations Development Program UNICEF United Nations Children’s Fund National University of Equatorial Guinea (Universidad Nacional de Guinea UNGE  Ecuatorial) US United States USF Universal Service Fund USSD Unstructured Supplementary Service Data UX User Experience VAT Value-added tax VC Venture Capital WHO World Health Organization XAF Central African CFA Franc 6 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC EXECUTIVE BRIEF The economies of tomorrow will be driven by digital transformation across sectors, espe- cially in response to the COVID-19 crisis and aftermath. In the past decade, technology has become ubiquitous in our daily lives. From the way we socialize, work, travel, communicate, save, purchase, study, and perform our daily tasks. This ubiquity has become even greater in the unprecedented fight against COVID-19, which has ultimately redefined how social and economic activities occur across and within countries, paving the way towards digital economies, at national, regional, and global levels. This report provides an assessment of Equatorial Guinea’s digital economy, as part of the World Bank’s Digital Economy for Africa (DE4A) initiative. Prepared to support the implementation of the Digital Transformation Strategy for Africa, approved by the African Union in February 2020, the World Bank’s DE4A Initiative aims to help drive Africa’s digital transformation and sets out a bold vision to ensure that every African individual, business and government is digitally enabled by 2030. The initiative leverages an integrated and foundation-based diagnostic framework to examine the development of the digital econ- omy across Africa. Based on this framework, this assessment provides a comprehensive overview of the five DE4A foundational elements in Equatorial Guinea: digital infrastruc- ture, digital public platforms, digital financial services, digital businesses and digital skills. Under the Digital Infrastructure pillar, recent negotiations with mobile operators aiming to reduce telecom service tariffs by a substantial 50 percent mark positive strides towards ensuring that broadband becomes more affordable and accessible in the country. Howev- er, important areas of improvement in Equatorial Guinea’s digital infrastructure remain. Regulatory challenges and limited competition in the broadband sector continue to be significant hurdles. Notably, quasi-monopolies in the international bandwidth access and national backbone markets are one of the key reasons why Equatorial Guinea has one of the highest broadband prices in the region. The absence of sufficient competition has resulted in an inadequate national fiber backbone, which still needs to be further expanded to cover significant portions of continental Equatorial Guinea. High prices and weak infrastructure translate in only 7.8 unique mobile-broadband subscriptions per 100 inhabitants, the lowest penetration rate in west and central Africa. Finally, the regulator, ORTEL (Órgano Regulador de las Telecomunicaciones), lacks the decision-making and financial powers, which together with the weaknesses of cybersecurity policies and measures, jeopardizes the development of the required digital infrastructure in the country for the digital economy to securely 7 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC thrive. Nevertheless, these challenges underscore the potential for significant growth and improvement in broadband accessibility and affordability to pave the way for Equatorial Guinea’s digital economy foundations to thrive. A digital civil registry pilot called SIREC (Sistema Informático del Registro Civil in Spanish) launched by the Ministry of Justice in 2018 sets an important milestone for Digital Public Platforms in in Equatorial Guinea. Subsequent to this pilot, in recent years the country has introduced laws and decrees to help digitize the public sector. The country still needs to strengthen its regulatory framework. Many laws are often outdated, some dating back to the country’s colonial period in 1965 (i.e., procurement law), which makes the introduc- tion of new digital public platforms challenging and raises concerns about data security and data use. Despite having a national agency for the digitalization of the public sector (i.e. CNIAPGE - Centro Nacional para la Informatización de la Administración Pública de Guinea Ecuatorial), which aims to become the one-stop-shop for digital public platform solutions, ministries are moving toward greater digitalization and informatization in silos planning their own platforms and solutions. The implementation of a currently absent national in- teroperability framework could significantly enhance the overall efficiency of the public sector by promoting a more integrated and collaborative approach. Finally, implementing a digital identity could help public entities to cut the dependance on manual documents for identification and avoid inefficiencies and fraud opportunities. To achieve this, the country has to work on strengthening the foundational identification system and operational trust framework for digital authentication. DFS in Equatorial Guinea are still in an early stage, with a limited amount of banks of- fering DFS in the country. More specifically, the use of the first generation of DFS (i.e. cash in/cash out and P2P transactions) remains at a nascent stage in the country, and the second generation of DFS (i.e. digital credits and insurances) are at the start of the devel- opment stage. Overall, a small number of banks have launched mobile banking solutions. The banking sector has shown early warning risks and vulnerabilities, especially during the COVID-19 pandemic. In this context, the focus of traditional banks on addressing risks to financial stability delayed their digital transformation efforts (including DFS development and commercialization). In addition, Equatorial Guinea remains the only country of the CEMAC (Economic and Monetary Community of Central Africa) that still needs to establish a licensed e-money operator to provide mobile money services. Furthermore, as described in the digital infrastructure chapter, the yet to be improved broadband access, as well as connectivity issues in certain parts of the country, especially in the continent, remains a key constraint to the development of DFS in Equatorial Guinea. Finally, the political pri- oritization of financial inclusion could be reinforced by the implementation of a national 8 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC financial education strategy which could strengthen education programs and initiatives to address low levels of financial literacy amongst the population. The digital business ecosystem in Equatorial Guinea is still in emergence, with a low number of domestic digital services and a nascent group of incubators, accelerators, and civil asso- ciations. Initiatives to improve the business climate in the country are being implemented, i.e., the Single Business Window, but digital entrepreneurs still face numerous barriers when launching their businesses and implementing expansion strategies. Firstly, as highlighted above, expanding internet access holds one of the keys to unlocking growth opportunities for businesses, especially those in the digital domain. Otherwise, it will limit their outreach, service potential and automation capabilities, hindering their establishment and expan- sion. Secondly, access to finance remains a significant challenge for digital businesses and entrepreneurs. The stringent requirements set by financial institutions make it difficult for businesses to secure the necessary funds. Thirdly, as described in the digital skills paragraph below, the shortage of qualified individuals with digital skills is notable. This is true both locally, because of the weaknesses of foundational digital skills in the national workforce, and internationally, because of the constraints to access the international pool of qualified staff. Finally, the presence of a weak regulatory framework hampers the development of the digital private sector in Equatorial Guinea. Developing regulations covering areas such as e-commerce, competence requirements, cybersecurity, and access to finance for digital businesses is paramount. Access to education has been expanded in the country in the last couple of decades, but there are still limitations to produce a digitally skilled population at scale. A specific ICT (Information, Communication and Technology) policy in education, the centralization of deci- sion-making across multiple agencies, and the coordination of programs funded by partners, are essential to strengthen the digital skills framework. It is also critical that basic education properly develops foundational STEM (Science, Technology, Engineering, and Math) skills, that the system provides the infrastructure to teach digital skills (i.e. electricity, computers, internet), that teachers become qualified and receive specific training on digital skills and that ICT is included in the education curriculum. Beyond the basic education sector, the chal- lenges persist. Higher education and TVET (Technical and Vocational Education and Training) institutions currently have limited capacity to provide the necessary programs to contribute to the diversification of the country’s economy. As a result, there is a consistent shortage of both skilled and unskilled local labor in Equatorial Guinea, with a clear mismatch between the supply and demand for digital skills. Nonetheless, as the digital economy continues to flourish on both domestic and global fronts, taking prompt, national-level actions becomes increasingly vital to address and alleviate the digital skills shortage. 9 Equatorial  Guinea Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC  D IGITAL ECONOMY DIAGNOSTIC @ Ground Picture / Shutterstock 10 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC EXECUTIVE SUMMARY This report provides an assessment of Equatorial Guinea’s digital economy, as part of the World Bank’s Digital Economy for Africa (DE4A) initiative. Prepared to support the implementation of the Digital Transformation Strategy for Africa, approved by the African Union in February 2020, the World Bank’s DE4A initiative aims to help drive Africa’s digital transformation and sets out a bold vision to ensure that every African individual, business, and government is digitally enabled by 2030. The initiative leverages an integrated and foundation-based diagnostic framework to examine the development of the digital econ- omy across Africa. Based on this framework, this assessment provides a comprehensive overview of the five DE4A foundational elements in Equatorial Guinea: digital infrastruc- ture, digital public platforms, digital financial services, digital businesses, and digital skills. In Africa, traditional economic sectors are transitioning to new growth models, leveraging rising mobile phone penetration, improving access to broadband Internet, and growing use of mobile money across countries, unleashing new opportunities for people, businesses, and governments. In 2021, mobile technologies and services generated 8 percent of GDP (Gross Domestic Product) or USD 140 billion in Sub-Saharan Africa (GSMA - Groupe Spé- ciale Mobile Association, 2022). Mobile money, which is driving financial inclusion in many African countries, contributed to an 8-percentage point increase in account ownership in developing economies between 2014 and 2021 (Demirgüç-Kunt, 2022). This digital revo- lution has spurred the development of a small but rapidly growing digital business sector, with innovative entrepreneurs launching new digital products and services and creating 21st century jobs. For countries like Equatorial Guinea, the digital economy offers a leapfrogging opportunity or the risk of being left behind. Today’s technologies, such as artificial intelligence, robotics, blockchain, drones, the Internet of Things, big data, cloud computing, 5G and software-en- abled industrial platforms, indicate the scale and speed at which technology is transforming traditional sectors of the economy. In particular, there are significant opportunities to be gained for the region in the agriculture sector, in public procurement, and geospatial data. The enormous economic potential far outweighs any downside risks that might emerge from greater transparency or unreliable data (African Development Bank - Statistics Department, 2017). Developing core infrastructure, systems, and competencies can also sustain new technologies and will help countries like Equatorial Guinea to skip the traditional model, and transition from a mainly extractive industries economy to a digital economy, leaping over intermediate steps (see Figure 1 below). 11 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Figure 1 Traditional Economies Becoming Digital Economies. (World Bank, 2020) GIVEN DIGITAL DIGITAL ECONOMY TRADITIONAL TRANSFORMATION, ACCELERATES GROWTH, ECONOMY TRADITIONAL SECTORS POVERTY REDUCTION, ARE BEING DISRUPTED JOB CREATION Digital Transformation of Sectors Digital Economy Digital Digital Digital Sector Sector Sector IIn the wake of new challenges and a prolonged oil-dependency, Equatorial Guinea’s gov- ernment is aiming for economic diversification as a key course of action for growth and stability in the medium and long term. The first phase (2008-2012) of its National Plan for Economic and Social Development (“Horizon 2020”) was mainly focused on infrastruc- ture: transport, electricity, hospitals and schools. The second phase (2013-2017) targeted developing other priority sectors alongside infrastructure such as agriculture, fisheries, tourism, and financial services. In 2014, the government established Holding Equatorial Guinea (HOLDING G.E.) to manage a $1.6 million investment fund created to finance its joint ventures with private companies in sectors identified as key to its economic diversification strategy. More recently, in January 2021 the government announced a new wide-ranging National Development Plan 2035, which will focus on: economic diversification, workforce training, social services, quality governance, eradicating poverty, infrastructure and promot- ing the private sector. Technology and innovation are a cross-cutting theme throughout the Development Plan, putting the digital economy at the center of the diversification strategy. The Ministry of Transport, Post and New Information and Communications Technologies (MTCT), through the General Directorate of Telecommunications and New Technologies, is also implementing the Digital Agenda for Equatorial Guinea (ADIGE), a strategic plan to promote the development of the Digital Economy in a coordinated and gradual manner, in order to make the most of the opportunities offered by Information and Communication Technologies (ICT). ADIGE has established four strategic objectives: (i) universalization of access to telecommunications services; (ii) digitize administrative procedures; (iii) sup- porting and enhancing the ICT sector; and (iv) empower citizens to use digital tools. It has 12 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC also established a roadmap that includes the extension of mobile and internet coverage throughout the country, incentives in digital transformation for companies and developers, training the population on digitalization and cybersecurity issues, among others. In this context, the World Bank has undertaken this digital economy diagnostic of Equa- torial Guinea. Based on desk research, virtual and in-person interviews with a wide range of public and private sector stakeholders, and a February 2023 field mission to discuss preliminary findings and proposed recommendations, this report analyzes the constraints in each of the five foundational pillars and puts forward actionable recommendations cat- egorized by priority level and sequencing. Overall, it aims to inform the national dialogue, as well as next steps, around Equatorial Guinea’s digital transformation and diversification, a policy agenda in which the Government of Equatorial Guinea (GoEG) has expressed keen interest. The next paragraphs detail the key findings of each pillar on the country’s enabling environment. A more detailed assessment is available under each pillar chapter, including the pillar’s importance, current state, and recommendations. Digital Infrastructure Recent negotiations by the Government of Equatorial Guinea and ORTEL with mobile opera- tors to reduce telecom service rates by 50percent are an important step to make broadband more affordable and accessible in the country. However, Digital Infrastructure in Equatorial Guinea still has challenges, mainly due to regulatory barriers and a lack of competition in the broadband sector. Findings show that there are quasi-monopolies in the international bandwidth access and national backbone network markets (GITGE - Gestor de Infraestruc- turas de Telecomunicaciones de Guinea Ecuatorial - and GETESA - Guinea Ecuatorial de Tele- comunicaciones SA - respectively) in the country. The low level of competition in these two market segments helps to increase the costs of wholesale services, which are higher than in other structural and aspirational peers. The quasi-monopolistic situation in these markets can also affect critical infrastructure. Finally, the current regulator in Equatorial Guinea, ORTEL (Órgano Regulador de las Telecomunicaciones), can greatly enhance its vital role in the national digital infrastructure with an empowerment of decision-making and financial capabilities. This empowerment would enable ORTEL to effectively engage in wholesale markets and efficiently collect essential statistical data from industry players. Extending the national fiber network to the main areas in Equatorial Guinea is still a critical challenge. Costs of a national fiber network are very high compared to the other countries in the region; this situation is mainly due to the regulatory challenges that prevent operators of deploying fiber for their own use, which has resulted in a monopoly favoring GITGE the 13 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC State-Owned Enterprise (SOE). Strengthening the independence and power of the regulator could contribute to these unregulated costs. Despite the efforts of the government, Equatorial Guinea has experienced a low mo- bile-broadband penetration rate, explained mostly by the high retail prices for broadband access in the country. With 7.8 unique mobile subscriptions per 100 inhabitants, the country ranks below its peers in terms of mobile-broadband penetration rate in Western Africa. In the past few years, the government has made efforts to address this situation through measures to reduce prices. Following negotiations with the government, on April 20, 2022, an agreement was signed by Equatorial Guinea’s mobile operators, ORTEL (the regulator) and GITGE, to reduce telecoms service rate ‘by 50 percent’ for the benefit of consumers. The subsequent Ministerial Order No. 2/2022 (April 27, 2022) established a maximum retail mobile data price per 1MB of XAF15 effective May 1, 2022. Conducting a cybersecurity maturity assessment could help Equatorial Guinea to obtain a clear landscape of its state of cybersecurity and identify areas of improvement to work towards both in the short-term and medium-term. The country still needs to advance in drafting a cybercrime law (UNCTAD - United Nations Conference on Trade and Develop- ment, 2023) and signing the African Union Convention on Cybersecurity and Personal Data Protection. Progress in these areas could help Equatorial Guinea to attract domestic and foreign investment, particularly in sectors that are heavily reliant on digital technologies, and to advance its position in rankings such as ITU’s Global Cybersecurity Index (where in 2020, the country ranked 180th of 181 countries studied). Digital Public Platforms Equatorial Guinea has introduced laws and decrees to help digitize the public sector in recent years. However, the country still needs to strengthen its regulatory framework, by completing and updating many laws which still date back to the country’s colonial period in 1965 (i.e., procurement law). The country’s constitution guarantees the right to privacy and in 2016, the country introduced an organic law on the protection of personal data. Critical policies and laws such as procurement, data interoperability and sharing frameworks, cy- bersecurity, or access to information, still need to be introduced and updated. Challenges in the legal and regulatory framework make the introduction of new digital public platforms complex and raise concerns about data security and data use. Capacity challenges are constraining the impact of the national agency for the digitaliza- tion of the public sector (i.e., CNIAPGE). While CNIAPGE is placed directly under the office of the president and has administrative and financial autonomy, the center still needs to 14 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC reinforce its legal authority to coordinate or lead the public sector’s digital development. CNIAPGE ultimately aims to become the one-stop-shop for digital public platform solutions for government ministries, however, it is facing difficulties in fulfilling this vision. This is due to the distinct nature of the different functions the center is tasked to address, which adds to the complexity of the work. As a result, moves toward greater digitalization and informatization in the public sector are increasingly occurring in silos as ministries move ahead with planning their own platforms. A national interoperability framework still needs to be established, as with few exceptions, digital platforms do not communicate with each other. The enterprise architecture to under- pin greater interoperability is still inadequate and incomplete. There is no interoperability platform (or a data exchange layer) either. The difficulties in the interoperability framework lower overall efficiency of the public sector and reinforce a siloed approach. In addition, data collected in one ministry is mostly inaccessible to other ministries (i.e., civil regis- try). The research yielded no shared platforms inside the government to host government systems across line ministries. Potential synergies that different public entities could gain from sharing data with each other are therefore lost or require time and effort to obtain. In order to achieve the implementation of a digital identity, the country must strengthen the foundational identification system and establish an operational trust framework for digital authentication. This could help public entities to cut the dependance on physical documents for identification which creates inefficiencies and more opportunities for fraud and reduces the burden on civil society when accessing services or transactions that require proof of identity. In addition, Equatorial Guinea still needs to implement an e-signature platform, which is critical for the country’s digital transformation. The country’s challenges in its identity systems and platforms also lead to higher transaction costs of delivery and receipt of public services (particularly for the most vulnerable populations) and compli- cate the ability of micro and small and medium enterprises (MSMEs) to access financial opportunities. Digital Financial Services Advancing in increasing the availability of digital financial products and services, by aug- menting the digital transformation of financial service providers in Equatorial Guinea, could represent an enormous opportunity for the uptake of DFS in the country. In Equatorial Guin- ea, DFS in general, and electronic means of payment, in particular, have not experienced the boom in development observed in neighboring countries in recent years. Financial Service Providers (FSPs) operating in Equatorial Guinea have adopted digital trends slowly and are 15 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC on a gradual path to the development and commercialization of DFS. Consequently, the use of cash remains deeply rooted in the culture. In addition, the use of the first generation DFS remains in its early stages in the country, and the second generation (i.e., digital savings and credits) is still in the development stage. As an example, all commercial banks offer debit and credit cards; however, only a few banks operating in Equatorial Guinea have launched mobile banking solutions. In addition, according to the bank of Central African States (BEAC), only one e-money operator received a license to provide mobile money services in mid-2023. This situation is expected to change in the upcoming months, when at least one additional mobile money product is expected to be launched in the country. Access to digital infrastructure as well as connectivity in certain parts of the country is essential to enable the development of DFS in Equatorial Guinea. The barriers in the Digital Infrastructure pillar cited above result in a significant part of the population in Equatorial Guinea still not having access to the basic digital infrastructure required to use DFS. In ad- dition, Equatorial Guinea could advance in the development of a national financial inclusion strategy, which could reflect the political prioritization of financial inclusion which should be a critical part of the government’s national development plan, as DFS makes it easier, safer and often more affordable for low-income populations to save, to borrow, to send or receive money, to pay remotely or to start a business. Equatorial Guinea is participating in the process of designing a regional financial inclusion strategy, which aims to harmonize regional policy efforts to develop the financial sector and to create an enabling environment to accelerate financial inclusion. However, in the absence of a national financial education strategy, the availability of financial education programs and initiatives remains limited to address the low level of financial literacy of the population. Given the growing complexity of financial products, financial education programs are critical to equipping the population with the financial knowledge and infor- mation to make appropriate financial decisions and to establish healthy financial habits. Nowadays, a significant portion of the population has a low level of financial literacy and remains unaware of the opportunities offered by DFS. In addition, most of the financial service providers interviewed do not consider themselves responsible for designing and implementing financial education initiatives and have mostly launched social marketing initiatives to educate existing and prospective customers on how to use their financial products and services. 16 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Digital Businesses The digital business ecosystem in Equatorial Guinea is still emerging, with a low number of domestic digital services. According to the World Bank Digital Business database, only three digital businesses have been mapped in international databases that track funding to digital business. This limited startup ecosystem is supported by an also nascent group of incubators, accelerators, and civil associations, including notable initiatives like TEG Campus, Girls in Technology or Dreams Hub. In addition, the GoEG has initiated a number of activities to improve business climate in the country, including the Single Business Win- dow or legislative modifications to attract foreign investment. However, digital companies and entrepreneurs interviewed highlighted that several barriers yet remain throughout the process of launching their businesses and implementing expansion strategies. Accessing finance remains a significant challenge for digital businesses and entrepreneurs in Equatorial Guinea. The stringent requirements set by financial institutions make it dif- ficult for businesses to secure the necessary funds through bank loans or incubator accel- erator programs. To overcome this challenge, it is crucial to focus on attracting external investments and engaging venture capital and angel investors. Businesses should prepare thorough documentation, including a well-structured business plan, financial projections, and evidence of market demand, to increase their chances of securing investments. The shortage of qualified individuals with digital skills is a notable hurdle. As described in the Digital Skills section below, although there are various training programs available, there is a lack of continuous and comprehensive digital skills training in schools and uni- versities that aligns with the needs of the private sector. Furthermore, the ability to access the international pool of qualified staff is impaired by visa and work permit restrictions. Bridging the gap between the supply and demand for digital skills is essential to drive digital development in the country effectively. The low maturity of the regulatory framework hampers the development of the digital private sector in Equatorial Guinea. While efforts are underway to develop the regula- tory framework and implement digital laws, effective enforcement is crucial. In addition to developing regulations covering areas such as e-commerce, competence requirements, cybersecurity, and access to finance for digital businesses, it is also essential to establish a comprehensive directory that compiles the laws and regulations governing the country. Furthermore, creating strong enforcement mechanisms for the existing legal framework is vital to ensure compliance and foster a supportive environment for the flourishing of digital businesses. 17 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Digital Skills The introduction of a specific ICT policy in education, the integration of decision-making across multiple agencies, and the coordination of programs funded by partners, could help strengthening the digital skills policy framework in Equatorial Guinea. The country still has to implement a digital skills framework and an overall skills qualification framework that features digital skills prominently. Most of the digital skills interventions are primarily made by civil society organizations or the private sector and are not at scale, which creates a fragmented system. In order to foster innovation and job creation Equatorial Guinea still relies on a 1992 labor law (Law on the Investment Regime), which is outdated, has not been utilized to invest specifically in digital skills, and does not have specific provision to incentivize digital skills. Access to education has expanded significantly in the last couple of decades, but it still needs to make significant progress to catch up with most countries in the region. High repetition rates (above 16 percent in early grades) and high attrition rates are increasing system inefficiency, impacting its ability to show more positive results. In addition, access to Internet in schools urgently needs to be strengthened and expanded beyond the capital, as well as teachers’ digital skills, in order to effectively leverage technology for educa- tional purposes. Furthermore, the government should prioritize the integration of ICT into the curriculum at all levels of education. The absence of ICT as a formal component of the curriculum hinders students from acquiring essential digital literacy skills, depriving them of the necessary tools to thrive in an increasingly digitalized world. Beyond the basic education sector, the challenges persist, as shown by the weak outcomes in higher education, which reflects very low access levels. The Technical and Vocational Education and Training (TVET) space is in a nascent stage. Many of the TVET training centers need to strengthen their ability to provide the skills needed for the diversification of the country’s economy. Beyond the formal TVET centers, training programs are available but still need to be expanded to equal other African countries, as they are hampered by inef- fective inter-ministerial collaboration. Finally, programs led by large tech organizations are still limited, but some opportunities exist such as IDENTIC academy, which offers a catalog of training in digital skills. Given the limited availability of data for Equatorial Guinea, there are challenges to report the percentage of the population with basic, intermediate, and advanced digital skills. Nevertheless, it seems clear that the education sector in the country needs to significantly strengthen to produce a digitally skilled population at scale, ignited by a general positive attitude of the population towards self-learning digital skills. Basic education will benefit 18 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC from adequate infrastructure to teach digital skills, teachers who are qualified and receive specific training on digital skills, equal opportunities for secondary education for all (es- pecially for girls), and access to post-basic education targeted towards the acquisition of digital skills, both in the formal and informal sectors, in order to properly develop foun- dational skills. As a result, additional efforts will be required in Equatorial Guinea to address the shortage of both skilled and unskilled local labor. The shortage of digital skills is reflected in the mismatch between the supply and demand for digital skills. Nevertheless, the shortage could be even more prominent in the near future if no urgent measures are implemented at the national level. As the country embarks on a development path that includes the di- versification of its economy, a low penetration of digital skills could constrain development of the digital economy. Cross-Cutting Issues Across the five DE4A pillars, five crosscutting issues stand out. These include improving institutional coordination including reinforcing strategic leadership and intergovernmental coordination on digital transformation; improving access to reliable electricity, both for businesses and households; addressing remaining regulatory gaps and strengthening im- plementation of the legal and regulatory framework; and bridging the island-continental digital divide. More specifically, these cross-cutting issues have the following implications in the country’s digital economy: •  Improving institutional coordination: ADIGE and Agenda 2035 are steps towards the country’s digital vision, which could benefit from a comprehensive whole-of government approach that can bring together the various constituencies of the government. Lack of such an approach is causing weak political buy-in, which together with a national agency for the digitalization of the public sector with limited operational capacity (i.e. CNIAPGE) and weak sectoral regulators, is paving the way for scenarios like quasi-monopolies in broadband market or ministries developing solutions in silos. •  Improving access to electricity: Equatorial Guinea is a major oil and gas producer, but still needs to improve in its electricity access rate. In the year 2000, the access rate stood at 65percent, while in 2020, latest figure available, it only rose to 66 percent. It is critical to address these results, especially considering access to electricity is fundamental when it comes to improving digital inclusion. Households and businesses without access to elec- tricity, on-grid or off-grid, need to rely on more expensive sources of energy limiting eco- nomic opportunities and constraining the development of the country’s digital economy. 19 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC •  Addressing remaining regulatory gaps and strengthening implementation of the legal and regulatory framework: The recent announcement by the MTCT to draft a cybersecurity bill in collaboration with the Ministry of Defense, Security and Justice is an important step, that needs to be complemented with the development and updated of laws involving cybercrime, data protection, e-commerce, consumer protection among others. •  Improving data quality, coverage, and usage: As described throughout the report, there is a very limited coverage and absence of substantial data across the pillars of the digital economy, in particular with regards to digital skills, digital financial services and digital business. Data collection plays a crucial role in informing decision-making processes for governments. It can help Equatorial Guinea identify trends, understand patterns, and assess the impact of policies and programs. It could enable the Government to measure outcomes and evaluate the effectiveness of interventions in the economy. Moreover, it would enable the country to identify disparities, inequalities, and areas of improvement, facilitating targeted and equitable policymaking. •  Bridging the island-continental digital divide and gender gap: Apparent differences have emerged not only between men and women, but also between the island of Bioko, where the capital Malabo is, and the continental part of the country, where important cities like Bata are located. These differences are prominent in access to digital infrastructure and digital services, access to electricity, access to education and financial literacy. While official data on the island-continental divide is not readily available, anecdotal evidence from relevant stakeholders suggests that access to key digital infrastructure and services is largely focused on the urban population in Malabo. Addressing both the gender divide and the island-continental divide will require concerted effort and a long-term strategy and political support aimed at addressing these differences. Going forward, it is essential for the Government of Equatorial Guinea to undertake con- certed reform efforts across the five pillars, while acknowledging the fragility-related con- straints, in order to support the development of a vibrant, safe, and inclusive digital econ- omy. The table below presents quick-win recommendations from the five pillars (Please note each chapter has a specific section with the respective recommendations, and there is a complete list of recommendations also available in Annex 1): 20 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Table 1 Summary of Quick Win Recommendations DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION DIGITAL INFRASTRUCTURE PILLAR FIRST MILE: INTERNATIONAL CONNECTIVITY International capacity wholesale market must be declared a relevant market and be regulated in a Growth Policy reform Quick win cost-oriented way following a proper market study. MIDDLE MILE: NATIONAL NETWORK Launch a market study that will potentially identify the national network fiber wholesale market as a relevant Growth Policy reform Quick win market and apply cost-oriented obligation to the significant market players. INVISIBLE MILE: SECTOR POLICIES AND REGULATIONS Conduct a cybersecurity maturity assessment with the aim of obtaining a clear overview of the current state of Productivity Policy reform Quick win cybersecurity in the country and to identify the areas that need to be strengthened and developed. DIGITAL PUBLIC PLATFORMS PILLAR GOVERNMENT STRATEGY Develop a national Strategy for digital public platforms, building on the existing strategies such as ADIGE and UNDP’s e-government strategies and ensure that existing gaps such Productivity Policy Reforms Quick-Win as data-management, interoperability, citizen-centric public platforms and other relevant themes are also addressed. LEADERSHIP AND INSTITUTIONAL READINESS Re-evaluate the role and function of CNIAPGE, to strengthen Productivity Policy Reform Quick-Win a much desired whole-of-government approach. DIGITAL FINANCIAL SERVICES PILLAR POLICY AND REGULATION: DELIVERY CHANNEL & PRODUCT INNOVATION Assess the need to expand and strengthen agent networks Equity/ Investment Quick win to foster DFS adoption, especially in remote areas. Inclusion 21 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION DIGITAL BUSINESSES PILLAR GENERAL POLICY ENVIRONMENT AND COORDINATION Articulate a roadmap to support digital entrepreneurship Investment and Growth Quick win and productive use of digital technologies. policy reform Promote public-private dialogue in the area of digital Growth Capacity Quick win businesses. VIBRANT, COHESIVE AND INCLUSIVE DIGITAL ECOSYSTEM Promote the development of an inclusive digital entrepreneurship ecosystem, through greater coordination, Productivity Policy reform Quick win transparency, and monitoring of the dynamics of the startup and Inclusion and incubator ecosystem. DIGITAL SKILLS PILLAR POLICY ENVIRONMENT Growth, Equity, Develop a national education ICT policy, a clear vision, and Inclusion, and Policy Reform Quick win EdTech strategies. Productivity Equity, Conduct a digital skills gaps assessment and approve a digital Inclusion, and Policy Reform Quick win skills framework. Productivity 22 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC @ VideoFlow / Shutterstock Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC INTRODUCTION EQUATORIAL GUINEA AND ITS NASCENT DIGITAL ECONOMY Equatorial Guinea, located on the African west coast, is the only former Spanish colony in Sub-Saharan Africa. The country’s population, which was estimated at 1.6 million people in 2021 (World Bank, 2023), consists of Río Muni (also known as Continental Equatorial Guin- ea), on the continent, and five islands, namely, Bioko (where the capital Malabo is located), Corisco, Great Elobey, Little Elobey, and Annobón. Bata is the mainland's administrative capital. In the political landscape President Obiang has remained in the executive power for over four decades. In 2022, President Obiang and his political party, El Partido Democratico de Guinea Ecuatorial (PDGE) were re-elected for a six-year term with 94.9 percent of the ballots. Equatorial Guinea is member of the Economic and Monetary Community of Central Africa (Communaute Économique et Monetaire de l’Afrique Centrale in French, CEMAC)1 and the OHADA (Organization for the Harmonization of Business Law in Africa, Organisation pour l’Harmonisation en Afrique du Droit des Affaires in French).2 Equatorial Guinea is an upper-middle income country which relies heavily on hydrocarbon production. With the discovery of large oil reserves in the 1990s, Equatorial Guinea became the third-largest producer of oil in Sub-Saharan Africa, after Nigeria and Angola, and one of the fastest growing economies in Africa during that decade (World Bank, 2023). Despite the decline of hydrocarbon production in the late 2000s, this sector remains the country’s primary source of growth, representing almost a quarter of the GDP. Agriculture is almost unexploited and remains confined to subsistent agriculture. However, it represents the largest source of employment for rural communities. The secondary sector, dominated by small-scaled manufacturing and followed by construction, has lost dynamism since the end of the oil-boom cycle of 2014. In contrast, the tertiary sector focused on low-value-added services, has been emerging in recent years to become the largest employer in the country. In 2019, the size of the informal economy in the country was estimated at 34 percent of CEMAC aims to promote peace and the harmonious development of its member states, in the framework of establish- 1   ing an economic union and a monetary union. OHADA is a West and Central African initiative to harmonize business laws and implementing institutions among its 2   country members. 24 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC GDP (US$5.71 billion).3 This informal sector, which includes the provision of both goods and services, grew quickly following the start of an economic recession in 2015, which was further exacerbated by the COVID-19 pandemic (US Department of State, 2022). In 2022, the economy contracted by 0.9 percent, its seventh consecutive year of recession which, combined with the impact of the COVID-19 pandemic, has likely curtailed progress in shared prosperity and poverty reduction. The economy is projected to contract in 2023 and through the medium term as a result of a reduction in hydrocarbon output, with an economy that remains highly vulnerable to oil-price shocks.4 Despite boasting the highest GDP per capita on the African continent, Equatorial Guinea suffers from weak socioeconomic development vis-à-vis its sub-Saharan counterparts. Equatorial Guinea’s hydrocarbon driven economic growth was not followed by an improve- ment in human development outcomes. The country was ranked 145 out of 189 in the Human Development Index (2019) (World Bank, 2022) with a value of 0.59, unaligned with its upper-middle income status. Equatorial Guinea is facing surging food prices, banking sector vulnerabilities and declining hydrocarbon production. Corruption persists as a chal- lenge in the country, which has been ranked 172 out of 180 in the Corruption Perceptions Index (Transparency International, 2021), with a score of 17 out of 100 (0 meaning highly corrupt and 100 no corruption). Moreover, the country’s oil and gas sector has received a score of 22 of 100 in the 2017 Resource Governance Index (RGI), ranking 85th among 89 assessments (Natural Resource Governance Institute, 2017). In addition, statistical capacity remains low, hampering efforts to raise the socioeconomic level of the general population, despite technical support provided by different agencies, including the World Bank and the IMF (International Monetary Fund), to improve the government’s capacity to collect data. Climate change is exacerbating the country’s natural disasters, putting vulnerable popula- tions increasingly at risk. Equatorial Guinea is facing risks related to loss and degradation of forests and ecosystems, natural disasters, and a vulnerable wildlife. The developing surveillance systems, uneven application of the law and unsustainable forest resource exploitation could progressively lead to a drastic reduction in the country’s forest cover, with ensuing threats to the ecosystems. The Inter-Governmental Panel on Climate Change (IPCC) has also projected an increase in extreme climate events such as floods and droughts occurring more often and with increasing severity, and affecting houses, crops, access to drinking water and key infrastructure (IPCC, 2022). https://futures.issafrica.org/. 3   4   https://www.imf.org/en/News/Articles/2023/06/09/pr23204-equatorial-guinea-imf-staff-concludes-visit-to-equa- torial-guinea. 25 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Furthermore, the several State-Owned Enterprises (SOEs) in the energy, housing, fishing, aerospace, and ICT sectors, many of which hold monopolies, hinder the country from bene- fiting from competitive markets and rates. In 2017, the government contracted Deloitte and Ernst & Young to conduct a detailed report on its SOEs, which provided a comprehensive list of these entities (Ministerio de Hacienda y Presupuestos - Republica de Guinea Ecuatorial, 2019). In the past years, the Ministry of Finance, Economy, and Planning discussed plans to involve the private sector in the management of state-owned assets and to open to competition sectors where public enterprises operate, with the aim of limiting monopolistic practices and passing on efficiency gains to the rest of the economy. In April 2022, in the telecommunications sector, it announced that it would be privatizing GETESA and GITGE. The government has not released details of the privatization process, but it has instructed the Ministry of Finance to establish the relevant procedures, including a transparent public bidding process that is open to international investors. In the wake of new challenges and its prolonged oil-dependency, Equatorial Guinea’s gov- ernment is aiming for economic diversification as a key course of action for growth and stability in the medium and long term. The first phase (2008-2012) of its National Plan for Economic and Social Development (“Horizonte 2020”) was mainly focused on infrastruc- ture: transport, electricity, hospitals and schools. The second phase (2013-2017) targeted developing other priority sectors alongside infrastructure such as agriculture, fisheries, tourism, and financial services. In 2014, the government established Holding Equatorial Guinea (HOLDING G.E.) to manage a US$1.6 million investment fund created to finance its joint ventures with private companies in sectors identified as key to its economic diver- sification strategy.5 As described in Box 1, in January 2021 the government announced a new wide-ranging National Development Plan (Agenda 2035), which will focus on: economic diversification, workforce training, social services, quality governance, eradicating poverty, infrastructure and promoting the private sector (TeleGeography, GlobalComms Database, 2022). Technology and innovation are a key axis in this new Agenda, present throughout the strategy, including a specific chapter on ICT fully aligned with SDGs (Sustainable Devel- opment Goal), which call for building resilient and sustainable infrastructure and promoting inclusive and sustainable industrialization. The MTCT, through the General Directorate of Telecommunications and New Technologies, is also implementing the Digital Agenda for www.holdingequatorialguinea.com. 5   26 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Equatorial Guinea (ADIGE), which as described in Box 2, is a strategic plan to promote the development of the Digital Economy6 in a coordinated and gradual manner. Box 1 Agenda Equatorial Guinea 2035 - National Strategy for Sustainable Development In April 2021, Equatorial Guinea adopted "Agenda 2035" through Decree 69/2021, which includes a Strategy for Sustainable Development 2020-2035. The Strategy confirms the Government's objective to work towards the achievement of economic diversification in 2035. The Agenda focuses on seven areas: i. Economic diversification; ii. Workforce training; iii. Social services; iv. Quality governance; v. Eradicating poverty; vi. Infrastructure; and, vii. Promoting the private sector commitment. Technology and innovation are a key axis in this new Agenda, present throughout the strategy, including a specific chapter on ICT fully aligned with SDG 9, which calls for building resilient and sustainable infrastructure and promotes inclusive and sustainable industrialization. The Strategy, which is a key step forward to achieve sustainable and inclusive growth in Equatorial Guinea, is supported by four strategic axes (i.e. poverty erad- ication, social inclusion and sustainable peace, productivity, and industrialization, and, environmental sustainability and territorial development) and will be carried out in three phases: • Phase A (2021-2025), Launch; • Phase B (2026-2030), Development; and, • Phase C (2031-2035), Consolidation. Digital economy is defined as the part of economic output derived from ICT and digital technologies with a business 6   model based on digital goods or services. The digital economy is made up of various components including platform economy, gig economy (based on flexible, temporary, or freelance jobs), industry 4.0 (trend towards automation and data exchange in manufacturing technologies), data analytics, robotics, and Artificial Intelligence (AI), machine learn- ing, 3-D printing and ecommerce amongst others. (Ernst & Young Nigeria, 2018). 27 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Box 2 Digital Agenda for Equatorial Guinea (Agenda Digital de Guinea Ecuatorial, ADIGE) The Digital Agenda for Equatorial Guinea (Agenda Digital de Guinea Ecuatorial, ADIGE) of the Ministry of Transport, Posts and Telecommunications is the main na- tional plan for the digital transformation of the economy. ADIGE is a strategic Plan to promote the development of the Digital Economy* in a coordinated and gradual manner. The Agenda is a common plan with indicators, defined projects, general and strategic objectives, lines of action and execution plans to make the most of the opportunities offered by Information and Communication Technologies (ICT). ADIGE contains four strategic objectives, namely: i. Universal access to telecommunications services; ii. Digitization of administrative processes; iii. Promotion and strengthening of the ICT sector; and, iv. Training citizens to use digital tools. ADIGE has also established a roadmap that includes the extension of mobile internet coverage throughout the country, incentives in digital transformation for companies and developers, training the population on digitalization and cybersecurity issues, among others. The Ministry of Transport, Posts and Telecommunications is currently in the process of designing a new version of the agenda for the period 2024-2029 in collaboration with UNDP. * Digital economy is defined as the part of economic output derived from ICT and digital technologies with a business model based on digital goods or services. The digital economy is made up of various components including platform economy, gig economy (based on flexible, temporary, or freelance jobs), industry 4.0 (trend towards automation and data exchange in manufacturing technologies), data analytics, robotics and Artificial Intelligence (Al), machine learning, 3-D printing and ecommerce amongst others. (Ernst & Young Nigeria, 2018). Collecting timely and reliable data for Equatorial Guinea’s digital economy could shape the government’s decision making in the sector. It could provide the country with the means to spot trends, discern patterns, and evaluate the effect of potential policies and initiatives. Furthermore, it would help to identify inequalities and areas in need of enhancement, thus fostering equitable policy formulation and investments in its digital economy. Box 3 high- lights the challenges for data collection and opportunities for Equatorial Guinea. 28 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Box 3 Digital Economy Data Coverage in Equatorial Guinea Data collection plays a crucial role in informing decision-making processes for gov- ernments. Given the nascent level of its digital economy, an important challenge that Equatorial Guinea will have to address is the lack of data transparency and availabil- ity regarding digital indicators. In order to inform policy makers and stakeholders and monitor progress, data gathering reflecting the status of the digital economy in Equatorial Guinea will be essential. Data collection can help Equatorial Guinea identify trends, understand patterns, and assess the impact of policies and programs. It could enable them to measure outcomes and evaluate the effectiveness of interventions in the economy. More- over, it would enable the country to identify disparities, inequalities, and areas of improvement, facilitating targeted and equitable policymaking. By harnessing the power of data, Equatorial Guinea can enhance its ability to address digital gaps, allocate resources efficiently, and advance in its digital transformation. As described throughout the report, there is a very low coverage and lack of sub- stantial information across the pillars of the digital economy, in particular with regards to digital skills, digital financial services and digital business. For instance, Equatorial Guinea is not included in the World Bank Global Findex 2021 report. In consequence, the team had to seek alternative secondary sources as well as infor- mation gathered directly from the different stakeholders on the ground in order to provide the most complete and comprehensive snapshot of the country’s Digital Economy. Digital Sector Context Equatorial Guinea digital economy is nascent and constrained by several bottlenecks. As described in the respective chapters in this report, significant constraints in the areas of digital infrastructure and digital public platforms have stifled wider development, lead- ing to the limited provision of digital public and financial services, a still nascent digital business environment, and a mismatch between supply of and demand for digital skills. Furthermore, in 2020 Equatorial Guinea has scored 43 out of 100 in the ITU (International Telecommunication Union) ICT regulatory tracker (ITU, 2022), which reflected the following 29 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC respective scores: the regulatory authority (13 out of 20), regulatory mandates (16 out of 22), regulatory regime (8 out of 30) and level of competition (9 out of 28) in the ICT sector main market segments. This reflects limited reforms and areas requiring improvement to reach liberalization and privatization in Equatorial Guinea’s ICT sector. Equatorial Guinea’s telecommunications sector will need to become more competitive to become an engine of growth for its economy. In terms of how the country is using information technologies to promote access and inclusion of its people, Equatorial Guinea was ranked 183rd out of 193 counties on the E-Government Development Index (EGDI), which incorporates access characteristics, such as infrastructure and educational levels (Figure 2).7 Figure 2 EGDI Score for Equatorial Guinea and structural and aspirational peers (2012 – 2022) (United Nations, 2022) 1 0.9 0.8 0.7 0.6 0.5 0.4 0.3 0.2 0.1 0 2012 2014 2016 2018 2020 2022 Gabon Qatar Equatorial Guinea Democratic Republic of Congo Mauritius United Arab Emirates Singapore Cameroon Costa Rica The structural peers were defined in alignment with the World Bank’s Country Economic Memorandum (CEM) for EQG. 7   The selection criteria were based on countries that have similar economic characteristics over 2015-2019 including GDP per capita, PPP (constant 2011 USD); oil rent; population; industry (% of GDP); trade (% of GDP); and government effectiveness. As described in the “Agenda Equatorial Guinea 2035” aspirational peers are Singapore, Qatar, United Arab Emirates, Costa Rica and Mauritius and were determined by the Government. 30 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC In the above context, digital transformation could play a critical role in diversifying Equato- rial Guinea’s economy in the upcoming years, aligned with the National Development Plan (Agenda 2035) and the Digital Agenda (AGIDE). The adoption of digital technologies has a potential to increase the productivity of Small and Medium-sized Enterprises (SMEs) and stimulate innovation in Equatorial Guinea. As described in the Digital Businesses chapter, the private sector in the country is falling behind in the adoption of these technologies, and the firms, public sector organizations, civil society organizations and individuals are losing from the benefits these technologies can have in accelerating product and process innovation, increasing productivity, and creating high-skilled jobs. Given the size of Equa- torial Guinea’s economy, digital marketplace platforms could help firms to expand and access other markets, what could be especially important to stimulate the development of the private sector in the country. Box 4 COVID-19 and the demand for digital transformation in Equatorial Guinea The COVID-19 pandemic highlighted the role of digital technologies for national resilience across sectors and underscored the urgent need to close the digital di- vide. The pandemic has accelerated the digital transformation worldwide, as many countries have been able to leverage digital technologies to ensure business and education continuity, prevent service interruptions, and otherwise cope with social distancing. Country-level policies and interventions have facilitated digital connec- tivity and the deployment of digital platforms to help citizens, governments, and businesses cope. More specifically, the government of Equatorial Guinea approved various initiatives in 2020 including measures to ease social effects as well as some targeted and temporary support to the private sector (estimated to cost 0.3 percent of GDP), which included halving withholding tax rates, and delaying tax payment deadlines for small and medium-sized firms and reducing electricity bills CITATION BTI22 \l 1033 (BTI, 2022). According to the Bank’s Business Pulse Surveys, shortly following the shock of COVID-19, one third of firms increased or started to use internet, social media, and digital platforms for business purposes (World Bank, unpublished). The pandemic, and the mitigation measures adopted to prevent the spread of the virus, highlighted the need to strengthen the adoption of digital technologies across public and private sector services. 31 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Table 2 Equatorial Guinea in Brief – Key Figures and Indicators INDICATOR VALUE SOURCE DEMOGRAPHY Population (millions) 1.6 WB2021 Urban population (% of total population) 75 WB2021 Youth population (% of total population, under 14) 39 WB2021 Life expectancy at birth (years) 61 WB2021 Infant mortality rate (per 1,000 live births) 57 WB2021 Adult literacy rate (% of people ages 15 and above) 94 WB2010 Youth literacy rate (% of people ages 15-24) 98 WB2010 Labor force participation (% of total population, ages 15-64) 56 WB2021 Employment in agriculture (% of total labor force) 56 WB2021 ECONOMY AND SHARED PROSPERITY GDP (current US$, billions) 12.27 WB2021 GDP per capita (current US$) 7,506 WB2021 GDP growth (annual %) -0.9 WB2021 Poverty headcount ratio at national poverty lines (% of population) 76.8 WB2006 Access to electricity (%) 66.7 WB2020 Source: https://data.worldbank.org. AFRICA’S DIGITAL TRANSFORMATION The digital economy offers a transformative opportunity across Africa for economic diver- sification, financial inclusion, poverty reduction and job creation. Africa’s internet economy is poised to reach US$180 billion by 2025 (up from US$115 billion in 2020), accounting for 5.2 percent of the continent’s GDP (Google and IFC, 2020). There is increasing evidence of the positive impact of access to internet and mobile technologies in Sub-Saharan Africa (SSA) on growth (Katz & Callorda, 2019), jobs (Hjort & Poulsen, 2019), innovation (Georges, Mensah, & Traore, 2021), firm and agricultural productivity (Ordu, Cooley, & Goh, 2021), and, critically, household consumption levels (Bahia, et al., 2020). In 2020, mobile technologies and services generated more than US$130 billion of economic value added (8 percent of 32 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC GDP) in Sub-Saharan Africa (GSMA, 2022). It has been estimated that this figure will reach US$155 billion by 2025, as countries increasingly benefit from improvements in productiv- ity and efficiency brought about by the increased take-up of mobile services. Digitalization and digital technology adoption have spurred innovation and brought enormous gains for consumers, businesses, and governments, as well as for the much-needed structural trans- formation and diversification of its economies. Digital technologies have also contributed to increased financial inclusion in Western and Central Africa. The region has witnessed increased access to transaction account (from 33 percent in 2014 to 48 percent in 2021) thanks to the development of digital financial services (i.e., mobile money). Furthermore, Information and Communication Technologies (ICTs) have been able to impact the lives of people and operations of governments and firms by significantly reducing the costs of economic and social transactions, including the cost of searching and acquiring information, bargaining, and making decisions, as well as monitoring and enforcing transactions. While many SSA countries are participating in the digital revolution, the continent as a whole—and Equatorial Guinea, in particular—is not yet prepared to capture a larger share of the global digital economy or benefit from its gains. More than two thirds of the population in Sub-Saharan Africa remain unconnected and digital divides persist. Making the internet universally accessible and affordable thus remains an urgent priority and although tech- nology costs have dropped, consumer access costs still vary greatly across the region. In terms of coverage and usage gaps, in 2020, 19 percent of its population remained without access to mobile internet services and 53 percent did not yet use mobile internet services despite living in areas covered by mobile broadband networks (GSMA, 2022). Furthermore, the gender gap in both mobile internet access and use across the region has not improved and continues to be the highest. Women in Sub-Saharan Africa are now 30 percent less likely than men to own a phone, compared to 22 percent in 2017, as men’s ownership is far outpacing that of women. The gender gap in usage has remained flat each year since 2017, at 37 percent (GSMA, 2023). On top of this, 18 percent of its rural population has no mobile network coverage at all, and another 11 percent has only 2G coverage – meaning that almost 30 percent cannot access the Internet (ITU, 2021). The development of digital skills is pivotal to fully benefit from the use of internet and services and fulfill new em- ployment opportunities. Poor digital literacy can in turn expose people to risks linked to cyberattacks or harmful content - risks which can be mitigated by designing appropriate policy and regulatory frameworks. These skills and infrastructure are key to improve finan- cial inclusion, especially to close the financial gender gap. Digital technologies, and more specifically, digital finance offers the possibility to bring underserved communities and the unbanked to the formal financial system. 33 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Digital transformation offers Equatorial Guinea important opportunities for accelerated, inclusive and sustainable socioeconomic development and job creation. Digital technologies are expanding access to global markets, changing business models, fostering innovation, and delivering productivity gains. ITU estimates that a 10 percent increase in mobile internet penetration in Africa is estimated to increase GDP per capita by 2.5 percent (ITU, 2021). According to recent research from Nigeria, increased mobile broadband coverage reduces the proportion of households below the poverty line, driven by an increase in labor force participation and employment—particularly among women—that allowed for higher food and non-food consumption in rural areas (Bahia, et al., 2020). Digital transformation could also help address the country’s gender gap. While primary data around the digital gender divide is not available, estimates suggest that women’s use of the internet is much lower than that of men. Without the proper analog complements (including robust policy and regulatory frame- works as well as risk-mitigation strategies), embracing the digital economy can amplify inequality, hollow out the labor market, or lead to even more concentrated markets. Indeed, digital transformation is increasing risks around cybersecurity, data privacy, and market concentration. The digital divide can aggravate exclusion and inequality; if designed and implemented properly, ICTs have the potential to support a country’s transition out of fra- gility (Kelly & Souter, 2014). Nevertheless, the economic potential of digital transformation— including opening up and reusing data, unleashing digital entrepreneurship, and enabling a digital workforce—is too large to ignore; rather, what is needed is to mitigate the downside risks (African Development Bank, 2017). Ensuring that Equatorial Guinea’s digital divide is not further widened, and that data leads to better lives will require supporting regulations that allow firms to connect and compete, skills development that augments rather than replaces, institutions that are capable and accountable, and a new social contract for data use that promotes the public good (World Bank, 2016; 2021). This report presents a timely diagnostic of Equatorial Guinea’s digital economy, demon- strating key existing opportunities and gaps and focusing on policies that can help the country address its fragility as well as accelerate its post-COVID-19 economic recovery, job creation, digital inclusion and economic diversification. Based on quantitative and qualitative assessments as well as extensive consultations with key public, private and civil society stakeholders in the country, the diagnostic provides a comprehensive assessment of the five foundational elements of Equatorial Guinea’s digital economy. Fully aligned with the overall objectives of the Government of Equatorial Guinea Agenda 2035 and the Digi- tal Agenda for Equatorial Guinea (ADIGE) further described in boxes 1 and 2 respectively, the report maps current strengths and limitations of each foundation and identifies chal- 34 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC lenges and opportunities for their future growth. Its findings provide practical, actionable recommendations to inform decisions in priority areas, proposing a mix of possible policy reforms, investments, and capacity-building interventions to harness the economic and social benefits of digital technologies and effectively mitigate associated risks. THE WORLD BANK’S DIGITAL ECONOMY FOR AFRICA INITIATIVE This assessment of Equatorial Guinea’s digital economy has been initiated as part of the World Bank’s Digital Economy for Africa (DE4A) initiative. Through the DE4A initiative, which supports the operationalization of the African Union’s Digital Transformation Strat- egy for Africa (2020-2030) (African Union), the World Bank has committed to undertaking country-level digital economy diagnostics across the continent. The DE4A initiative has set an ambitious vision, underpinned by measurable goals and indicators, to ensure that every African individual, business, and government is digitally enabled by 2030. The initiative, rooted in five core principles (comprehensive, transformative, inclusive, home-grown, and collaborative), also seeks to ensure that the digital economy is truly inclusive and addresses emerging risks, such as cybersecurity. The resulting country reports serve to highlight key policy reforms and investments needed for African countries to achieve their digital trans- formation ambitions while also mitigating the risks of growing digitization. These reports have contributed to structured dialogue between authorities, the World Bank, development partners, the private sector, and non-state actors around concentrating efforts, catalyzing action, and enabling progress toward implementation and achievement of digital economy objectives; they have also directly informed World Bank systematic country diagnostics and country partnership frameworks, as well as downstream engagements. 35 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Table 3 Digital Economy for Africa Initiative Principles DE4A PRINCIPLES Taking an ecosystem approach that looks at supply and demand, and COMPREHENSIVE defies a narrow silo approach in defining the requisite elements and foundations for digital economy Aiming at a very different scale of ambition beyond incremental “islands” TRANSFORMATIVE of success Digital Economy for everyone, in every place, and at all times creating INCLUSIVE equal access to opportunities and dealing with risks of exclusions Based on Africa’s realities and unleashing the African spirit of enterprise HOMEGROWN to have more homegrown digital content and solutions, while embracing what is good and relevant from outside the continent Dealing with the digital economy requires a different flexible “mindset,” requiring different types of collaboration among countries, among COLLABORATIVE sectors, and among public and private players, facilitations, retooling and encouraging risk taking The related diagnostic is based on a broadly tested methodology focused on five founda- tional building blocks of a vibrant, inclusive, and safe digital economy. These five pillars are as follows: a. Digital Infrastructure, consisting of affordable and reliable connectivity and data repos- itories,8 instrumental to bringing people, businesses, and governments online; b. Digital Public Platforms, offered by public institutions, underpinning e-government ser- vices and supporting the efficiency of core government operations; c. Digital Financial Services, enabling paying, saving, borrowing, and investing through the digital means key to accessing digital services and expanding financial inclusion; Connectivity includes mobile and fixed access networks, metro and backhaul networks, national backbone networks, 8   and international connections. Data repositories include data centers and clouds. The digital infrastructure also in- cludes active and passive infrastructure necessary to develop the digital economy downstream (sites, masts, towers, spectrum, etc.). 36 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC d. Digital Businesses, including digital startups (early-stage ventures creating new digital solutions or business models) and established digital businesses that serve as a critical enabler for traditional “offline” businesses to adopt new technologies and business mod- els; and, e. Digital Skills, spanning from foundational digital literacy to the intermediate, advanced, and highly specialized digital skills, crucial to drive innovation and technology’s adoption. Figure 3 Digital Economy Foundations and Pillars DIGITAL ECONOMY FOUNDATIONS / PILLARS APPLICATIONS LIKELY TO DEVELOP ONCE THE FOUNDATIONAL ELEMENTS ARE IN PLACE • GOVTECH applications • COMMERCE adoption USE CASES • OPEN BANKING: non-banks offer tailored services • DATA LOCKER to access selected services DIGITAL BUSINESSES DIGITAL PUBLIC PLATFORMS DIGITAL FINANCIAL SERVICES DIGITAL SKILLS DIGITAL INFRASTRUCTURE CROSS-CUTTING AREAS • Strong legal and regulatory frameworks to foster competition and MFD agenda; • Manage risks including from legal and regulatory perspectives, data privacy, cyber security: • Opportunity to empower women and apply to FCV 37 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC @ Boijonell Prod / Shutterstock 38 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC 1 | DIGITAL INFRASTRUCTURE 1.1 | IMPORTANCE When it comes to Digital, infrastructure entails all the network elements that contribute to the provision of digital services. These elements can be broken down into three parts that constitute the broadband value chain. The First Mile, where the internet enters a country, ensures access to the worldwide internet network (through the submarine cable systems, landing stations, cross-border terrestrial cables, international gateways, satellite dishes, cross border microwave, etc.). The Middle Mile, where the internet passes through the country, is referred to as the national backbone network and intercity networks, meshes metropolitan networks across cities, Internet Exchange Points (IXPs), and local data centers. The Last Mile, where the internet reaches the end-users, can be a wireless (2G, 3G, 4G, 5G, WiMAX) or fixed (in copper pair or fiber optic) access network, connecting the end-user to the Digital Services Providers. In addition to these segments, it is often agreed upon to have a fourth part named the ‘Invisible Mile’ relative to the institutional, legal, and regulatory environment conducive to the efficient deployment of Digital Infrastructure. Universally available, affordable, and accessible digital connectivity accelerates inclusive and sustainable economic growth. The impact of increased broadband uptake on economic growth, poverty reduction, and employment is widely documented. For instance, an ITU 2020 study for Africa shows that a 10 percent increase in broadband penetration is cor- related to a 2.5 percent growth in GDP per capita. Digital connectivity allows end-users to obtain information (on the price of the products and services of their interest), buy and sell products and services online, and work and maintain social activities without having to commute. This results in increased opportunities for youth, community development, and gender equality. When value chains, public services, and social activities started to shut down during COVID-19, digital solutions enabled countries to ensure the continuity of vital economic and social activities through digital means, despite the global economic recession. Many countries leveraged digital connectivity and platforms amid the pandemic by substituting online learning for conventional education to ensure learning continuity during school closure. Despite having the worst unique mobile broadband penetration rate (7.8 percent), Equatorial Guinea has a good internet user penetration rate (53.9) above the Africa west and central average (46.99), this is helped a lot of Equatorial Guinea mitigate the impacts of the pandemic on education. 39 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC 1.2 | DIAGNOSTIC FINDINGS: CURRENT STATE OF DIGITAL INFRASTRUCTURE The following chapter discusses the current state of digital infrastructure in Equatorial Guinea. The chapter is structured alongside the broadband value chain described in the previous page (i.e., the First Mile, the Middle Mile, the Last Mile, and the Invisible Mile) including aspects such as accessibility, reliability, and affordability of broadband internet in the country. Regarding the Invisible Mile, the chapter evaluates current policies and regulations relevant for broadband connectivity, assessing elements such as the regulator responsibilities, pricing directives, Universal Service Fund (USF), digital dividend spectrum or regional roaming. The following key indicators help to provide an overview over where Guinea Equatorial stands in its development of digital infrastructure when compared to its peers in terms of broadband access, quality, and affordability (Table 4). 40 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Table 4 Digital Infrastructure DE4A Indicators Benchmarking STRUCTURAL PEERS ASPIRATIONAL PEERS (Central African Republic) Timor-Leste Congo Rep. Azerbaijan Costa Rica Cameroon Singapore Mauritius Gabon Qatar EQG UAE CAR INDICATOR SOURCE Individuals using the Internet per  54%  N//A  72% 11% 46% 39% 86% 100% 83% 91%  68% 100% ITU, 2021 100 inhabitants9 ACCESS WB “Unique” mobile- analysis broadband based on subscriptions 8% 23% 40% 10% 27% 20% 63% 97% 68% 93% 66% 96% GSMA, UN per 100 Population, inhabitants10 2022 QUALITY Average Mobile Cable. broadband  1.34 6.79  5.81 N/A 3.35 0.94 6.61 22.75 24.58 116.62  13.44 25.02 co.uk, downloadspeed 2022 (Mbit/s) AFFORDABILITY Average Price of 1GB (as a % Cable.co.uk of monthly GNI 2.16 0.60 0.63 22.3 1.11 1.32 0.38 0.11 0.21 0.01 0.10 0.12 WB GDP, - Gross National 2022 Income - per capita) Source: ITU, GSMA, UN Population, Cable.co.uk Internet users are individuals who have used the Internet (from any location) in the last 3 months. The Internet can 9   be used via a computer, mobile phone, personal digital assistant, games machine, digital TV etc. Defined as mobile broadband capable connections (unique SIM cards registered on the mobile network in a device 10   capable download speeds of 256 kb/s or greater) divided by SIM cards per unique mobile subscriber (unique active SIM cards per subscriber) (GSMA 2022), divided by the total population (UN 2022). 41 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Box 5 Access to Electricity and its impact on digital inclusion Access to electricity is fundamental when it comes to improving digital inclusion. Despite being a major Oil and Gas producer, Equatorial Guinea has seen a very low improvement in its electricity access rate since 2000 (65 percent in 2000 vs 66 percent in 2020). In addition, there are huge disparities in how access to adequate and affordable energy is distributed across the territory (0.9 percent in rural areas Vs 91 percent in urban areas). As of 2020, Equatorial Guinea was generating more than its annual electricity need, mainly from non-renewable energy (937 GWh, 88 percent) and partly from renewable sources (127 GWh, 1 percent). Access to electricity can affect the availability, uptake, and usage of mobile connec- tivity. Limited availability of a reliable source of electricity can reduce the avail- ability of mobile connectivity because network operators seeking to roll out base stations in non-electrified areas have to incur higher costs stemming from the use of electric generators and securing fuel in remote areas. On the other hand, households without access to electricity, on-grid or off-grid, need to rely on more expensive sources of energy to power their mobile handsets. Low access to electricity can limit economic opportunities, thereby constraining the demand for mobile connectivity. Source: IEA (International Energy Agency), IRENA (International Renewable Energy Agency), UNSD (United Nations Statistics Division), World Bank, WHO (World Health Organization). 2023. (https://data.worldbank. org/indicator/EG.ELC.ACCS.ZS). 42 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC First Mile: International Connectivity Equatorial Guinea was first connected to an international submarine cable in 2012, when the Africa Coast to Europe (ACE) cable landed in Bata. One year before, the State-owned Enterprise Gestor de Infraestructuras de Telecomunicaciones de Guinea Ecuatorial (GITGE)11 was created via Decree and tasked with managing and operating the government’s public telecoms infrastructure, including the connectivity to the Africa Coast to Europe (ACE) inter- national cable system. In 2017, The Ceiba 2 submarine cable was put into operation, which allowed for redundancy in the national submarine cable Ceiba 1 that already connected Malabo and Bata, Ceiba-2 is a 290-kilometer submarine cable that connects the cities of Malabo and Bata in Equatorial Guinea with Kribi in Cameroon. The Ceiba-2 submarine cable is a milestone that fulfills the protection of the link between Bata and Malabo, currently connected through the Ceiba-1 submarine cable (national backbone) and composing the second international connection point for Equatorial Guinea. Ceiba-2 also makes it possible to interconnect ACE’s submarine cable with Cameroon. It also offers the possibility to con- nect to other cable systems such as WACS, SAT-3 and Main One via Cameroon. The system is equipped with an initial 40 Gbps lambdas system and is scalable to a 100 Gbps lambdas system to meet future demand. Subsequently, in 2019, capacity was activated on the South Atlantic Inter Link (SAIL) submarine cable that connects Kribi, Cameroon with Fortaleza, Brazil, which allowed it to have a second international exit and offer redundancy services. With the activation of Segment 4 of the ACE, GITGE activated international capacity to South Africa, which allowed it to diversify its international departures to the Internet not only in Europe, but also through Africa and America (through SAIL). Recently, at the beginning of 2023, it was put into operation the Ultramar GE submarine cable was landed linking Sao Tome to the island of Annobon (in Equatorial Guinea), to relieve the dependence of this isolated island on satellite. From all the capacity available on the ACE submarine cable, currently only 40 percent of the total international Bandwidth of Equatorial Guinea is used. It should be noted that the measurement used in the ACE system to estimate the capacity is MIU.Km, therefore the following table includes an approximate estimate of the activated and available capacity in Gbps. GITGE operates as a subordinate organization to the Minister of Transport Communication and Telecommunication. 11   43 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Figure 4 International submarine cables and terrestrial backbone Source: GITGE. Table 5 Details of total international Capacity ASSIGNED CAPACITY ACTIVATED CAPACITY AVAILABLE CAPACITY 130 Gbps 60 Gbps 90 Gbps Source: GITGE. Compared to other countries in the region, Equatorial Guinea has relatively low internation- al bandwidth and modest annual growth (Figure 5). On the other hand, the total capacity per user indicator puts Equatorial Guinea in first place in the sub-region, ahead of countries like Gabon, Cameroon, and Congo (Figure 6). This can be explained by the very low unique mobile-broadband penetration rate in Equatorial Guinea (7.8 percent). This also would imply that the current bandwidth is more than sufficient for the low number of users. With regard to the pricing of this international bandwidth, Table 6 shows the onerous nature of the tariffs applied by the sole operator, GITGE, compared with the rates applied in the region. The table shows the huge gap between capacity services costs between Equatorial Guinea and CEMAC countries like Cameroon and Chad. The high cost of international bandwidth which increases the operating costs of mobile operators can be explained by the monopo- listic situation GITGE is enjoying and a lack of ex-ante regulation of this wholesale market. The additional exit provided by SAIL did not allow to reduce capacity wholesale prices as aimed by GITGE due to its monopoly and to the very low capacity added. 44 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Table 6 Costs of international bandwidth EQG MONTHLY COSTS CAMEROON MONTHLY COSTS CHAD MONTHLY COSTS CAPACITY (US$) (US$) (US$) 10 Mbps $2,216 $454 N/A STM-1 $38,000 $12,000 $8,592 STM-4 $133,000 $47,000 $25,776 Source: GITGE and TeleGeography, GlobalComms Database. Figure 5 International bandwidth (Gbps) 32 22 19 17 15 13 9 6 6 3 4 2 2 3 2 Cameroon Chad Congo, Rep. Equatorial Guinea Gabon 2020 2021 2022 Source: TeleGeography. Figure 6 International Bandwidth per user (Kbps) 12.85 9.61 5.79 3.11 1.37 0.26 Cameroon Central Chad Congo, Equatorial Gabon African Rep. Guinea Republic Source: TeleGeography. 45 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Middle Mile: National Backbone and Supporting Infrastructure GITGE is also responsible for running the national submarine cables, CEIBA-1, CEIBA-2 and ULTRAMAR. The CEIBA-1 cable, which connects Bata with Malabo, has a total length of 290km and a total capacity of 80Gbps. The CEIBA 2 Cable connects Sipopo and Bata to Kribi Station in Cameroon and is a backbone of the NCSCS submarine cable. Through this cable, GITGE has another international output through SAIL connecting Kribi with Fortaleza and has 30Gbps of capacity in each segment, that is, approximately 100Gbps of available capacity. The ULTRAMAR Submarine Cable connects the island of Annobon with São Tomé and Bata through the ACE and has a total length of 263 km, from the island of Annobón (GE) to São Tomé. The cable consists of 2 FPs with the capacity to carry 4.8 Tb per FP with an initial capacity of 100 Gb/s per fiber pair using current technology. In addition to the submarine cables, there is a National Fiber Optic Network (RNFO) that was deployed in two phases. Phase 1 connects the Malabo, Riaba and Luba Metropolitan Area in the Island Region and the Bata, Niefang, Nkimi, Nkue, Micomiseng, Bidjabidjan, Mongomo, Monogomeyen, Oyala, Añisok, Ayene in the Mainland Region. While phase 2 connects the cities of Baney, Rebola, Sampaka, Basupu and Moka in the island region and in the continental region, Rio Campo, Mbini, Mboete, Cabo San Juan, Kogo, Nkoho, Acure- nam, Oveng, Nsork, Asok and Midjobo. Despite the wide national fiber backbone network, Mobile operators are mostly using microwaves for their national network, with more than 90 percent of sites connected via microwave investing significant amounts in its renovation and maintenance instead of using the NOFN which undoubtedly has a higher capacity and service guarantee. Figure 7 Terrestrial national backbones Source: GITGE. 46 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC The national fiber network still needs to be extended to the main areas of Equatorial Guinea. Costs of national fiber network are very high compared to other countries of the region (Table 7); this situation is mainly due to the regulatory inability of operators to deploy fi- ber for their own use and to the monopoly that GITGE is enjoying. In fact, there is no open access regulatory framework; the scope of telecom operators’ licenses does not cover the deployment of fiber optic infrastructure, only GITGE (SOE) can deploy fiberoptic infrastruc- ture. The absence of an independent regulator has contributed to these unregulated costs. Table 7 Cost of national backbone network bandwidth CAMEROON MONTHLY CHAD MONTHLY CAPACITY EQG MONTHLY COSTS (US$) COSTS (US$) COSTS (US$) 10 Mbps $1,105 $825 N/A 100 Mbps $11,055 $3,089 N/A STM-1 $15,420 $3,471 $3,567 STM-4 $49,700 $10,471 $10,701 Source: GITGE and Camtel reference offers. Last Mile: Access network and market structure In Equatorial Guinea, as in many developing countries, internet services are mainly ac- cessed through wireless networks. This is mainly due to (i) relatively high cost of deploying fixed broadband infrastructure, (ii) relatively vast and geographically hard-to-reach areas, especially in the continental regions, (iii) low population density (50 inhabitants per km2 of land area), and (iv) lack of enabling legal and regulatory framework. This also affects the education sector since connectivity in schools is very low. The next sections take stock of the Equatorial Guinean broadband market and sector competition and evaluate how it impacts access, affordability, quality, and use of broadband services. 47 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Competition & Market Structure Equatorial Guinea’s mobile sector has three providers, the oldest of which, state owned fixed/mobile operator GETESA, launched GSM services in April 2000 and continues to dominate the sector. GETESA was established as a 60/40 joint venture between the state and French telecoms Orange Group, but a legal dispute between the partners soured the business relationship. As a result, the French investor had no tangible involvement in the running of the company, and an Orange exit from GETESA’s ownership was finally agreed via an international settlement in September 2018. GETESA enjoyed a monopoly until November 2009, when GreenCom (Muni) launched GSM (Global System for Mobile communication) mobile services under a unified telecom license awarded to its Kuwaiti-backed forerunner, HiTS Equatorial Guinea, in 2008. Having part- nered with local government investors to develop its network, Muni reportedly suffered from financial problems which slowed its growth. In January 2012, Equatorial Guinea Communications Company (GECOMSA) was created, a joint venture between the government of Equatorial Guinea (51%) and ZTE (49%) Chinese telecommunications equipment manufacturer, GECOMSA launched the country’s third mo- bile network, based on CDMA (Code Division Multiple Access) supplied by ZTE, to offer the Government Mobile Communications Service (GOTA) largely focused on the island of Bio- ko, while being at the same time a relatively small niche mobile phone provider in terms of commercial service open to the general public. It is important to note, a singularity of the three operators indicated in relation to their ownership, that in the case of Equatorial Guinea they are the Government or local business groups, while in practically all African countries, both the traditional operator and the new operators with mobile phone licenses belong to business groups such as Airtel; MTN; Orange; Maroc Telecom; Etisalat; Viettel; etc., which due to their size have synergies and due to their international status, do not have the capacity for local lobbying and regulatory culture. 48 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Figure 8 Mobile players market shares 99% 82% 76% 14% 16% 5% 8% 1% 0% GETESA MUNI GECOMSA 2G 3G 4G Source: Organo Regulador de Telecomunicaciones (ORTEL). GECOMSA was the first to launch a 3G network (CDMA standard) in Equatorial Guinea. GETESA took until September 2014 to launch 3G network (UMTS: Universal Mobile Tele- communications System) and was slow to expand 3G across the country. GETESA disclosed in late 2018 that it was preparing to build out 3G nationally. Coverage was estimated at 85 percent as of February 2022. 3G competition was further improved by the August 2016 launch of GreenCom’s (Muni’s) W-CDMA/HSPA+ network, however, take-up has remained modest in scale. While notable developments in Q2 2019 saw GETESA implement ‘3G+’ (HSPA+) upgrades and Muni switch on the country’s first 4G network sections, these mainly focused on fixed modem services initially, and with no indication from Muni that it was redirecting efforts to 4G smartphone users by February 2022. In 2021, the operator MUNI put into service its 4G NETWORK (LTE-FDD) to provide mobile voice and data services in the cities of Malabo and Bata, which represent more than 50% of the population. GETESA introduced its own 4G (LTE-FDD) services in late-December 2020 when it began marketing 4G smartphone and modem connectivity. without the ease of VoLTE (voice ser- vices are managed by the 3G network). GETESA expanded commercial 4G mobile coverage across five main cities – Malabo, Bata, Djibloho, Mongomo and Ebebiyin – with its LTE pop- ulation coverage confirmed as exceeding 70 percent by February 2022. Note that GECOMSA also introduced an LTE-TDD access network in Malabo in December 2020, to provide fixed wireless broadband, managing mobile services through its 3G-CDMA network. 49 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Figure 9 Figure 10 Muni 2G/3G coverage map GETESA 2G/3G coverage map Source: GSMA. Source: GSMA. Broadband Access and Usage Most internet usage in Equatorial Guinea is accounted for by mobile/fixed wireless ser- vices. These are offered over the cellular networks of GETESA (GSM, 3G and, from Decem- ber 2020, 4G), Muni (which began augmenting its 2G/3G services with 4G in mid-2019) and GECOMSA with its 3G-CDMA network. Muni has expanded their offerings in the fixed market too, with the former announcing the launch of residential fiber broadband in Sep- tember 2020. GECOMSA introduced fixed 4G LTE-TDD (Long Term Evolution) broadband services for residential and office users in December 2020, however, it has not achieved full commercialization of its services. The services cover selected districts of Malabo, Bata and adjacent areas where 4G-LTE-TDD network coverage exists. Since mid-2021, GITGE has been operating as a wholesaler of FTTH services. Since then, GETESA rolled out local fiber access and point-to-point services in 2017, initially aimed squarely at the business market, and it was not until February 2022 that GITGE publicized availability of FTTH services through GITGE for residents of ‘social housing’ (multi-dwell- ing apartment blocks) in two Malabo districts. After GITGE began FTTH pilots in Malabo in 2020, in November 2021 (latest disclosure as of March 2023) GITGE reported that it was marketing FTTH to four operators for residential or office-targeted services (GETESA,Muni, two corporate-focused ISPs (Internet Service Providers) Conexxia and OfficeTech, Fenix. Muni began marketing GITGE’s FTTH service in social housing blocks, with maximum speeds limited to 10Mbps. 50 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Equatorial Guinea has the lowest unique mobile-broadband penetration rate in west and central Africa (12 percent according to ORTEL). Despite having various number of play- ers and services, a quite robust national backbone network and sufficient international bandwidth (see Table 5), market concentration on state owned enterprises, and barriers faced by potential competitors to operate in the market, result in a low number of internet subscribers in the country, especially when compared with structural and regional peers. Furthermore, high costs of operation, unaffordability and low digital literacy are also hin- dering the improvement of broadband access and adoption. In addition to the aforementioned operators, providers of telephony and broadband ser- vices throughout the national territory, Equatorial Guinea has the following fixed wireless broadband Internet Service Providers (ISPs) located mainly in the capital cities: Conexxia; IPXEG; Phoenix; Officetech; ZAE; Hnos Cachu (conditional television service provider) and Guinea Net (recently acquired by the operator MUNI). Some of these operators also offer fixed broadband services of the FTTH type by renting the wholesale service from GITGE. Affordability and Quality Following a series of international submarine fiber link launches, Equatorial Guinea began to implement measures to reduce prohibitively high end-user retail prices for fixed broad- band access. The government resolved to focus on the development of affordable internet access from 2018 onwards, with priorities including fiber backbone network extension/ca- pacity upgrades and support for mobile internet expansion. In March that year the telecoms ministry published the first resolution (by ministerial order) approving a downward path of maximum wholesale and retail broadband prices, thus obliging GITGE and the Operators and PSI to reduce the prices of transport capacity and the final prices for users. In March 2019, further wholesale and retail price reductions were ordered. Such moves were temporarily interrupted by a moratorium on price cuts prompted by economic knock-on pressures from the COVID-19 pandemic. Following negotiations with the government, on 20 April 2022 an agreement was signed by Equatorial Guinea’s mobile operators, ORTEL (the regulator) and GITGE, to revert to the original broadband resolution and to reduce telecoms service rates. The Ministerial Order No. 2/2022 (27 April 2022) established a maximum retail mobile data price per 1MB of XAF 15 effective 1 May 2022. GETESA adopted the maximum permitted retail rates while some competitors including Muni chose to offer rates below the maximum threshold. 51 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC The authorities called the initial price reductions ‘provisional,’ stating that ‘final’ reductions would be defined via ongoing studies, whilst warning that operators failing to comply could face license revocation. Further policy guidance prompted Ministerial Order No. 3/2022 (10 August 2022), obliging operators to cut internet/data prices on 1 September 2022, including an obligation to set a maximum retail mobile data charge of XAF1 (including VAT – Val- ue-added tax) per 1 MBYTE . With these new retail broadband prices, Equatorial Guinea is in line with the average broadband prices of the CEMAC countries, although further reductions in tariffs and the corresponding wholesale costs will be necessary to ensure affordability and in particular, in this most important case, accessibility (extension of broadband to the entire national territory) that currently does not exist. Table 8 Data Package prices GETESA MUNI DATA TIME PRICE DATA TIME PRICE 100 MB 24 hours 300 F 250 MB 1 day 250 F 500 MB 24 hours 500 F 375 MB 1 day 375 F 1 GB 24 hours 900 F 500 MB 1 day 500 F 2.5G 7 days 2,500 F 1.5 MB 1 day 1,500 F 5G 7 days 4,500 F 1,5 GB 7 days 1,500 F 8 GB 1 month 8,000 F 2.5 GB 7 days 2,500 F 16 GB 1 month 15,000 F Source: Getesa & Muni. 52 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Invisible Mile: Sector Policies and Regulations In Equatorial Guinea, The Ministry of Transport, Post and New Information and Commu- nications Technologies (MTCT) is the top-level regulator and policy maker in the telecoms sector, sharing regulatory duties with its subordinate agency, the non-independent Tele- communications Regulatory Body (Organo Regulador de las Telecomunicaciones, ORTEL in Spanish). The MTCT was formed via Decree No. 16/2018 of 6 February 2018, replacing the Ministry of Telecommunications & New Technologies (Ministerio de Telecomunicaciones y Nuevas Tecnologias, in Spanish). The General Telecommunications Law (7/2005) passed into the statute books on 7 Novem- ber 2005, formally establishing ORTEL as a technical office of the Ministry – which began operations in 2007 via Decree 62/2007 – and paving the way for private investment and competition. A raft of amendments to the General Law entered into force on 15 April 2008 to reinforce the primary legislation, including Interconnection Regulation, User Rights Regula- tion, Universal Service Regulation or Regulation of the Universal Service Development Fund. More recently, in 2018-2020 ORTEL and the MTCT have promoted Law 7/2005 through the corresponding regulatory development. In this way, in addition to the regulations initially developed between 2008 and 2010, such as those of the Universal Service, the Regulation of Fees and the Legal Regime of the Spectrum, others have been developed in the field of thrdefinition of electronic communications markets; obligations of licensees regarding exploitation of available networks for public services; national numbering plan updates;; quality of service (QoS) obligations/measures;, via regulations including: Ministerial Orders 3/2018 and 4/2018 of 22 August 2018 ‘On Electronic Communications Markets’ and ‘On Comprehensive Quality of Services’; 3/2020 ‘On Obligations of Public Service Providers’ (2 December 2020); and 4/2020 ‘On Inspection, Penalty and Collection Action’ (3 December 2020). Despite all these subsequent regulations, the general legal and regulatory based on a 2005 general telecommunication law needs to be reviewed against international bestprac- tices and the current challenges of the Equatorial Guinean digital sector. More recently, in August 2023, the Ministry responsible for telecommunications submitted to the Government for approval the Regulations on the sharing of active and passive infrastructures. Equatorial Guinea does not currently have the adequate cybersecurity policies and mea- sures for the digital economy to securely thrive. The country does not have a cybercrime law, (UNCTAD, 2023). In addition, the country has not signed the African Union Convention on Cybersecurity and Personal Data Protection, held in Malabo, on 27 June 2014 (African 53 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Union, 2023).12 On top of this, Equatorial Guinea scores 180th of 181 countries studied in the ITU’s Global Cybersecurity Index (2020),13 which measures a country’s cybersecurity commitments in terms of legal, technical, organizational, capacity development, and cooper- ation measures. Inadequate cybersecurity can deter both domestic and foreign investment, particularly in sectors that are heavily reliant on digital technologies. This could limit job creation for digitally qualified individuals in these sectors as well as undermine the protec- tion of DFS consumers. The absence of a national regulatory framework on cybersecurity makes users of DFS vulnerable to cybersecurity risks such as fraudulent transfers, creden- tial thefts or payment system disruptions. The increasing reliance on digital infrastructure coupled with the lack of a clear governance framework detailing responsible stakeholders in the case of cyberattacks undermines the trust in the use of digital technologies. How- ever, cybersecurity plays an important role for the government and efforts are being made to improve its current landscape. In April 2023, the Ministry of Transport, Post and New Information, and Communications Technologies has raised for Government approval a cybersecurity bill, in collaboration with the Ministry of Defense, Security and Justice, with the goal of protecting equipment, networks, software applications, critical systems, and data from potential threats in the digital environment (Buiyabán Bichua, 2023). for subsequent processing in parliament.14 Another step that has been taken is the creation of the Cybersecurity department at the Ministry of Security through a presidential decree 63 and 64, dated April 14, 2023, in which the general directors and deputy Director Generals have been appointed. The design and implementation of the Government Data Center is based on a modular structure, where each module performs a security function. The data center is equipped with new generation firewalls and the installed equipment is supplied by manufacturers such as Fortinet and Palo Alto. There are also other international private cybersecurity companies operating in the country such as Dataprotect and BostonSolux, the latter having an office in the country. Data storage infrastructure exists in Equatorial Guinea, within both the private and public sectors. CNIAPGE has set up data storage infrastructure and is trying to adapt to the needs of the administration, but this infrastructure is not certified since it does not currently Fifteen African Union member states have adopted the Malabo Convention including Angola, Benin, Chad, Congo, 12   Egypt, Gabon, Gambia, Guinea-Bissau, Lesotho, Mauritania, Namibia, Niger, Sao Tome and Principe, Senegal, and Zambia. This instrument is divided into 4 chapters: Commercial transactions, Protection of personal data, Promotion of cybersecurity and fight against cybercrime and Chapter Final provisions. https://www.itu.int/en/ITU-D/Cybersecurity/Pages/global-cybersecurity-index.aspx. 13   14  https://ahoraeg.com/politica/2023/04/13/transportes-pone-en-marcha-el-anteproyecto-de-ley-sobre-cibersegu- ridad-y-ciberdelincuencia-en-guinea-ecuatorial/. 54 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC meet the criteria required for certification. Private sector players such as telecom oper- ators, capacity providers such as GITGE and internet service providers such as IXPEG, all have data storage infrastructure which still requires investments to become certified data centers. The scarcity of approved data storage and governance strategy and the absence of certified data centers bring a lack of confidence in the national storage infrastructure. Those policy and infrastructure gaps will need to be addressed by adopting known inter- national best practices. Regulator Responsibilities The MTCT and ORTEL have joint responsibility for telecoms pricing regulation technical standards setting; numbering; universal service/universal access management; QoS stan- dards setting; sectoral taxation and enforcement of QoS obligations. ORTEL is additionally responsible for frequency allocation and assignment, spectrum monitoring and usage en- forcement, type approval, and QoS monitoring. The MTCT is solely responsible for telecoms operator licensing. The ministry also oversees the broadcasting and IT sectors, with partial responsibility for internet content issues. In this configuration, ORTEL does not function as an effective regulator to apply and enforce the regulations in force as well as the sec- toral regulation guaranteeing free competition since it lacks the resources, independence, and, what is even more important, power to exert effective influence on operators. These malfunctions and shortcomings explain the scarcity of statistical information on the OR- TEL website and the very low frequency with which it is updated. ORTEL faces enormous difficulties while trying to collect information from players in the digital economy sector, despite regular requests to these players. Despite a real willingness and being aware of international best practices, ORTEL has not been able to start a market study to identify Significant Market Power (SMP) players or move towards a review of any part of the reg- ulatory framework. Evidence of the above is that unlike the regulators of other CEMAC countries, where the resolutions on non-compliance of operators and the sanctions imposed are recorded, in Equatorial Guinea there are no resolutions on non-compliance by operators in terms of prices, coverage, quality of service, among other issues that can be penalized by regulation. The MTCT/ORTEL also administer interconnection regulations, Although they have com- petence in this area, interconnection does not seem to be applied (operators do not apply interconnection between them) nor has it been regulated in the absence of complaints. The operators are not required to publicly issue interconnection agreements or Reference Interconnection Offers (RIOs), according to the regulatory authorities’ 2020 submissions to the ITU (latest available as of February 2022). These submissions also stated that operators 55 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC holding Significant Market Power (SMP) or market dominance under law may be subject to ex ante obligations named as: transparency, non-discrimination, interconnection/price con- trols, and regulatory accounting/accounting separation. Criteria used in determining market dominance/SMP (2020) were listed as: market share in terms of number of subscriptions or revenues; control of essential facilities; and ‘easy access to financial resources. In any case, this established regulation, unlike other countries and CEMAC regulators, has not been effectively applied. As a result, ITU ranks Equatorial Guinea as the country with the lowest regulatory enforcement (Table 9). Table 9 Global ICT Regulatory Outlook for EQG and peers EQUATORIAL CONGO CENTRAL AFRICAN ITU INDEX CHAD GABON CAMEROON GUINEA REP REPUBLIC Regulatory Authority 13 17 15 15 17 14 Regulatory Mandates 15 17 16 17 18 18 Regulatory Regime 13 22 13 16 16 9 Competition 9.3 19.7 14.3 15 13 17 Framework Overall ranking 50.3 75.7 58.3 63 64 58 Source: ITU Global ICT Regulatory Outlook 2020. Taxation Taxes on mobile communications have obvious advantages. They can generate significant revenues, which will only keep growing in the coming years as a larger share of the popula- tion gains access to mobile services. However, the tax treatment of the sector is not always aligned with best-practice principles of taxation; this may have a distortive impact on the industry’s development. Sector-specific taxes and fees are often the driver for the high tax burden: around 26 percent of the taxes and fees paid by the mobile industry related to sector-specific taxation rather than broad-based taxation. In Equatorial Guinea, there is also a contribution to the development of universal service, but it is not implemented and a 21 percent custom tax on telecoms equipment (terminals included) approved in 2022 and replacing the previous 51% tax. These taxes are similar to those applied in other African countries in general and CEMAC in particular. In Equatorial Guinea, there are no fees or 56 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC auctions for the allocation of mobile services, unlike in many African countries. In terms of general taxes, telecommunications services are taxed with a Value Added Tax of 15% and telecommunications operators have their profits taxed with a tax similar to that applied to any other company. These various taxes, paid by all licensees (including state-owned enterprises) and collected by the Treasury, have a final impact on the affordability of digital services and on the operating costs of the private sector, however they are similar and even lower than those applied in other African countries, as there is no fee or tax to obtain the various mobile phone licenses (2G; 3G; 4G and more recently 5G). Universal Service Fund The establishment of a universal service fund (USF) defined by Law 7/2005 became an obligation by regulation of the 15 April 2008, but the USF did not become operational until 2018 and to date it has not made its collection effective. All telecom operators are required to contribute 1.5 percent of gross revenues (discounting interconnection costs) to the USF but are not yet contributing. Under law, USF funding could cover voice telephony (including residential fixed lines), mobile (for individual users), cellular public payphones, dial-up/ broadband internet, school connectivity and emergency facilities. ORTEL’s annual reports mention an absence of USF activities due to the lack of contributions from the players, without explaining its root cause. This situation is likely caused by the power imbalance between ORTEL and the telecoms operators when it comes to ensuring compliance with the regulatory requirements and obligations. Digital Dividend Spectrum The National Commission for the Transmission of Terrestrial Digital Television (CNTTDT) initiated the project to migrate from analogue to digital terrestrial TV (DTT) in March 2015, with prospective benefits for mobile (4G) broadband service development by freeing up ‘digital dividend’ frequencies nationwide. This will make it possible to allocate spectrum resources in the 800 MHz and 700 MHz bands, which are more efficient for covering large areas. In fact, these frequency bands make it possible to cover a wider area with a very limited number of sites. ORTEL issued the ‘DTT frequency resolution’ in November 2017. Due to the number of terrestrial (free-to-air) television channels, it has not been neces- sary to apply the digital dividend in Equatorial Guinea, since these frequencies were not occupied by terrestrial television but by a private conditional access television operator (private DTT) that has been warned by ORTEL that it must abandon its share of spectrum in the 700 MHz band. Consequently, the 700 and 800 MHz frequency bands are available for 57 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC mobile use. Notwithstanding the above, the last regulatory report (2020) to the ITU stated that the spectrum of the digital dividend has not yet been reallocated at the national level. Regional Roaming In August 2020, the Central African Economic & Monetary Community (CEMAC) – compris- ing Equatorial Guinea, Cameroon, Central African Republic, Republic of the Congo, Gabon and Chad – approved the elimination of mobile roaming charges between member states, whereby CEMAC-based users traveling within the region would be charged their standard rates for calls and messages. The implementation of the measure was delayed given the local difficulty and the lack of capacity of the regulator to impose the roaming regulation approved by ARTAC. On 2 November 2022, ORTEL announced that the roaming agreement had been signed between the operators of Equatorial Guinea and Gabon (GETESA, Muni, Airtel-Gabon and Gabon Telecom [ MOOV]), being the only agreement signed to date. Agree- ments with operators from the other CEMAC countries have yet to be signed. Summary of Constraints Legal and Regulatory Framework: The legal and regulatory framework has been overtaken by the sector’s current challenges. In fact, the regulatory framework in general and the 2005 Telecommunications Act, which governs the digital economy sector, need to be reviewed and modernized, taking into account the innovations and new players that have emerged in the ecosystem. This review will allow the smooth introduction of necessary reforms and institutional changes that are essential to the development of the digital economy in Equatorial Guinea. Absence of an independent regulator: Equatorial Guinea lacks an independent telecom regulator with the decision-making and financial powers to enable it to play its important role in the digital economy sector. The absence of this vital player has many undesirable knock-on effects that are preventing the sector from developing smoothly. Monopoly in the international capacity and national backbone network markets: There are quasi-monopolies in the international bandwidth access and national backbone network markets. The lack of competition in these two market segments is the main reason why the costs of wholesale services are much higher than in CEMAC countries such as Cameroon, Gabon, and Congo. This monopoly situation in these markets leads to a lack of redundancy in critical infrastructure. 58 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Absence of ex-ante regulation on wholesale services: ORTEL’s lack of intervention in the wholesale markets stems from its weak status and its insufficient power and resources. Cost-oriented wholesale rates are necessary to allow retail operators to reduce the costs of operation and then reach more affordable retail prices. For example, ORTEL is currently not able to perform a market study/SMP identification and a cost calculation study that would allow it to be in a better place to correctly regulate the entire wholesale market. In the meantime, ex post regulations like monitoring players behaviors and settling disputes between players are not currently done by ORTEL. Non-operational Universal Service Fund: The existence of an operational universal service fund makes it possible to give operators financial incentives, or through fiscal or regula- tory facilities, to set up in unprofitable areas. The non-operational nature of the Universal Service Fund is a clear brake on the improvement of digital inclusion, particularly in the most remote areas. As specified at the article 24 of the 2005 telecom law, ORTEL has the mission of developing the universal service. 59 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC 1.3 | DIGITAL INFRASTRUCTURE RECOMENDATIONS DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION FIRST MILE: INTERNATIONAL CONNECTIVITY Increase Redundancy: The lack of sufficient redundancy Medium on international bandwidth must be resolved by joining Resilience Investment term an additional major international submarine cable. Reduce prices on international capacity services: To reduce prices on international capacity services, the international capacity wholesale market must be Growth Policy reform Quick win declared a relevant market and be regulated in a cost- oriented way following a proper market study. MIDDLE MILE: NATIONAL BACKBONE NETWORK Strengthen the National backbone fiber wholesale market: Launch a market study that will potentially identify the national network backbone fiber wholesale Growth Policy reform Quick win market as a relevant market and apply cost-oriented obligation to the significant market players. Reduce microwave spectrum fees: More than 90 percent of the sites are on microwave. To lower costs of Medium Growth Policy reform operation, microwave spectrum fees must be lowered by term aligning them with international/regional benchmarks. LAST MILE: ACCESS NETWORKS Increase coverage in rural areas: Coverage in rural areas can be improved by putting in place incentives for mobile operators to invest in areas that are not economically viable, using the Universal Service Fund (USF) and government subsidies. Infrastructure sharing obligation also helps a lot as well when it comes to Medium covering the underserved or unserved areas. Growth Policy reform term This recommendation must be developed jointly with the Digital Skills recommendation that will focus on deploying a connectivity plan which includes schools both in urban centers and in rural or remote areas (Please see Digital Skills recommendations in the respective chapter). Address the usage gap: Mitigate the usage gap (population already covered by a 3G/4G) but not using Medium Growth Policy reform internet) by improving digital literacy, reducing taxes on term digital services and on smartphone acquisition costs. 60 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION INVISIBLE MILE: SECTOR POLICIES AND REGULATIONS Review the telecom law: A review of the 2005 telecom law will allow the creation of separate and financially independent regulatory authority with all necessary power to regulate the market efficiently must be Medium created and an update of the spectrum management Productivity Policy reform term framework to onboard best practices like refarming and finalize the migration of terrestrial TV from analog to digital and then allocate the digital dividend frequencies (700 and 800) to mobile operators at a reasonable cost. Perform a cybersecurity maturity assessment: Conduct a cybersecurity maturity assessment with the aim of obtaining a clear overview of the current state of cybersecurity in the country and to identify the areas Productivity Policy reform Quick Win that need to be strengthened and developed so that Equatorial Guinea can become a digitally secure nation. These findings would be used to inform development of a national cybersecurity strategy and action plan. Strengthen the legal and regulatory framework for cybersecurity: Create a legal and regulatory cybersecurity and cybercrime framework by preparing Medium Productivity Policy reform and adopting necessary bills and applicative decree. term Sign the cybercrime and personal data AU Malabo Convention. 61 Equatorial  Guinea Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC  D IGITAL ECONOMY DIAGNOSTIC @ Yaw Niel / Shutterstock 62 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC 2 | DIGITAL PUBLIC PLATFORMS 2.1 | IMPORTANCE The importance of digital public platforms for the development of the public sector and a country at large cannot be overstated. Their benefits include connecting people across large distances, facilitating the transaction of digital goods, spurring information exchange, and leading to more efficient public services. Digital public platforms can be deployed across a wide range of public sectors such as health, education, infrastructure, or social protection, among others. Population benefits from digital public platforms through a myriad number of ways. Some examples include receiving government social payments, ordering their passport through an e-government portal, or finding their nearest healthcare facility. Governments on the other hand can benefit from greater efficiency in the public sector, gain a better understanding of bottlenecks in public services or improve citizen engagement and transparency by making non-sensitive data publicly available. Digital public platforms and their development is highly country context specific and de- pends on government priorities. In the first stages, governments tended to prioritize public financial management systems to be digitized due to their crucial function as revenue gen- eration. Subsequently, a siloed and iterative approach has often been used to add digital solutions at the back end and finally at the front end. This approach, however, has resulted in systems that are not communicating with each other and are difficult to integrate. On the other hand, the digital public platform approach requires a “whole-of-government” strate- gy. This strategy acknowledges that services are often shared and interconnected and that different users such as government-to-government (G2G), government-to-population (G2P) and government-to-business (G2B) have different needs. However, these may be addressed with a common user interface and a seamless interoperability. 2.2 | DIAGNOSTIC FINDINGS: CURRENT STATE OF DIGITAL PUBLIC PLATFORMS The following chapter discusses the current state of digital public platforms in Equatorial Guinea. The chapter first focuses on the enabling environment, assessing aspects such as the country’s legal and regulatory framework enabling the use and introduction of public 63 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC platforms in the country. The assessment also covers the state’s capacity to successfully design, introduce, and maintain digital public platforms through the use of a national strat- egy and its institutional readiness. After discussing the enabling environment, the chapter then looks at Government to Gov- ernment systems (G2G) such as Integrated Financial Management Systems (IFMIS), digital civil registries or Human Resource Management (HRM) systems. This is followed by Gov- ernment to Population (G2P) and Government to Business (G2B) systems that are used for public service delivery across different sectors such as health portals or judicial platforms. To conclude, the chapter discusses interoperability and data security of systems and finally looks at Civic-tech and transparency solutions. The following key indicators help to provide an overview over where Guinea Equatorial stands in its development of digital public platforms when compared to its structural and aspirational peers. As mentioned before, Equatorial Guinea has to improve the data collec- tion and reporting as there is no information available with regards to ID coverage in the Identification for Development (ID4D) Global dataset15. https://id4d.worldbank.org/global-dataset. 15   64 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Table 10 Digital Public Platforms DE4A Indicators Benchmarking STRUCTURAL PEERS ASPIRATIONAL PEERS (Central African Republic) Timor-Leste Congo Rep. Azerbaijan Costa Rica Cameroon Singapore Mauritius Gabon Qatar EQG UAE CAR INDICATOR SOURCE DIGITALIZATION OF PUBLIC OPERATIONS AND SERVICES E-Government 0.27 0.37 0.55 0.14 0.45 0.44 0.69 0.90 0.77 0.91 0.72 0.71 Index UN, 2022 183 161 115 191 141 147 83 13 56 12 75 78 Rank out of 193: DIGITAL IDENTIFICATION AND AUTHENTICATION Percent of the 15+ population ID4D Global with an officially  N/A  63%  73% N/A 83% N/A N/A 90% 95% 97%  99% N/A Dataset, recognized 2021 identity credential Source: World Bank, ID4D Global Dataset In 2022, Equatorial Guinea ranks 183 in the UN’s E-Government Index out of 193 countries, with a score of 0.27, climbing two positions from 185 in 2020.16 The country has gradu- ally lost ground vis-à-vis other developing nations in the global ranking since the Index was introduced, and other countries in the region are also achieving higher scores such as Cameroon with 0.45, Nigeria with 0.45 and Gabon with 0.55, the latter is ranked 115th in the global list. The GovTech Maturity Index (GTMI), which was recently launched by the World Bank mea- sures the maturity of digital transformation in the public sector along four focus areas. They include Support of core government systems (CGSI); enhancement of service delivery (PSDI); mainstreaming of citizen’s engagement (CEI) and fostering GovTech enablers (GTEI); https://publicadministration.un.org/egovkb/en-us/Data/Country-Information/id/55-Equatorial-Guinea. 16   65 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC each focus area is again divided into a set of around 10 indicators. It aims to provide a baseline and benchmark for GovTech maturity and help identify areas for improvement. Equatorial Guinea does not perform well in any of the four focus areas which the figure below illustrates that compares the score to the median of the sample of 198 economies. Data on public sector digitalization is generally scarce and difficult to obtain in Equatorial Guinea. This is in part due to technical challenges, with a lot of information still being col- lected manually, but also a lack of data sharing mechanisms which leads to siloed informa- tion that is difficult to access for other interested stakeholders both inside and outside the government. Greater data availability can not only help the government understand how to prioritize its efforts on digital public platforms, but it can also help build trust with the public and increase transparency in institutions. Figure 11 GovTech Maturity index: Equatorial Guinea vs Global Average 0.093 GTMI 0.552 0.064 CGSI 0.575 0.119 PSDI 0.649 0.118 DCEI 0.449 0.071 GTEI 0.536 0.0 0.5 1.0 GTMI CGSI PSDI DCEI GTEI Global Average Legal, Policy, and Regulatory Framework Equatorial Guinea has introduced laws and decrees to help digitize the public sector in re- cent years but overall, the regulatory framework is still incomplete or not fully adequate. Extant laws are often outdated, some dating back to the country’s colonial period in 1965 (i.e., procurement law) (Real Equatorial Guinea, 2021) making a comprehensive digitalization 66 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC of the public sector a very difficult task. Currently the national civil code is based on the Spanish colonial civil code. It therefore requires an update to provide the necessary impe- tus to centralize the nation’s civil registry and pave the way for the use of this important registry by different sectorial ministries. The country’s constitution guarantees the right to privacy, the right to petition the govern- ment and use complaints mechanisms (Government of Equatorial Guinea, 2022). It does not, however, mention the right to personal identity. In recent years, the country has introduced some legal codes that at least provide a legal basis for the introduction of digital technol- ogy in the public administration. The 2014 law on administrative procedures states that the administration shall promote the use and application for electronic, computerized and telematic techniques. Moreover, when compatible with the technical means available to the administration, citizens may interact with it to exercise their rights through electronic and computerized means17. Equatorial Guinea also introduced an organic law on the protection of personal data in 2016. The law provides regulation on data protection, data use of third parties, data col- lection, data reuse, data security and confidentiality and the guarantee of fundamental rights of the individual. It is not clear to what degree the law is currently being applied as several ministries seemed unaware of data protection mechanisms when collecting or managing personal data of citizens. The law also does not cover areas such as identification, authentication, and authorization of data use. The country also does not currently have an e-payments and e-transactions framework, which is further discussed under the Digital Financial Services chapter of this report. Government Strategy While Equatorial Guinea is currently without a national e-governance strategy to introduce Digital Public Platforms, efforts from UNDP and the Ministry of Transport, Mail and Tele- communications with its Digital Agenda for Equatorial Guinea (ADIGE) form a good basis on which to build such a national strategy. As described in Box 2, the Digital Agenda for Equatorial Guinea (ADIGE) is a manual for the telecommunications sector in the country to help it develop and foster the overall digital development of the country (Nvó Acaba, 2022). One of its objectives is the introduction of an electronic administration which the Agenda identifies as having all procedures in the government digitized and that citizens may sub- mit their transactions with government agencies electronically (Ministry of Transport, Mail Ministry of Public Administration of Equatorial Guinea, 2014. Art. 43 1+2 17   67 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC and Telecommunications of Equatorial Guinea, 2019). Other high-level development plans from the government have recognized the need to promote the digitalization of the public sector in the last two decades. The country launched a national development strategy for sustainable development in 2007 called ‘Horizon 2020 in Equatorial Guinea.’ One of its objectives was to Implement a strategic State and a modern administration. However, in its mid-term evaluation severe shortcomings in the modernization of the public administration were acknowledged. The successor to the Horizon 2020 in Equatorial Guinea was launched in 2021 under the name “Agenda 2035”, further described in Box 1, lists as one of its objec- tives the modernization and decentralization of public administration services (Art. 3 xi.). The ministries are tasked to report on their progress toward the goals set out for 2035. The United Nations Development Program (UNDP) has also collaborated with the Minis- try of Telecommunication to develop a national e-government strategy. For its drafting UNDP hired an international consultant and used its own team. The launch workshop for this strategy was held in November 2022. UNDP is currently implementing the ‘Support to the Digitalization of Equatorial Guinea’ project in the country to develop the national e-government strategy (UNDP, 2021) further. Among others, the strategy looks at how to: improve digital leadership in the government, develop the necessary digital capacity in the entire public sector, redesign transactional services in the public sector to align them with digital services, increase the use of digital public services, develop digital public platforms for public service delivery and improve how the government uses technology to better communicate to citizens. Despite the slow progress accomplished in introducing new digital public platforms, there is a strong motivation by public officials to achieve greater results and make the public administration more efficient. This was indicated by an IMF report from 2019 stating that “Public officials constantly indicated that the informatization was a priority to accomplish better efficiency of the public sector”. During the party’s national congress in 2021 the party highlighted the need to modernize the country’s tributary management system (Dem- ocratic Party of Equatorial Guinea, 2021). This motivation was also shared by government counterparts during the DE4A mission. Leadership and Institutional Readiness In 2013 the government of Equatorial Guinea issued the decree to establish the National Center for the Informatization of the Public Administration (Centro Nacional para la In- formatización de la Administración Pública de Guinea Ecuatorial, CNIAPGE in Spanish). The center was officially created in 2015 with the aim to ensure interoperability between 68 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC government digital platforms, data and system security, and data sovereignty. This marked an important step toward greater digitalization of the public administration. Among the 3a) lists: “planification, design, analysis, supervision and center’s role, the new law (Art.   control of the informatization of the public administration and all aspects related to this process.” Moreover, the law stipulates a series of other responsibilities such as overseeing procurement procedures in the informatization of the public sector, informing the govern- ment about progress and training human resources involved in the process of informatizing the public administration. The center is headed by a board of directors with a president, currently the Government’s Prime Minister, a representative from the Ministry of Trans- port, Post and New Information and Communications Technologies, the ministry of public function and administrative reforms, and the ministry of finance and budget respectively, as well as CNIAPGE‘s general director, who has voice but not voting rights on the board. CNIAPGE has since been playing an increasingly important role in the digitization of the public administration of Equatorial Guinea. Among the different activities implemented by CNIAPGE it is worth highlighting the following: (i) overseeing the allocation of funds for the introduction of digital solutions to different ministries; (ii) assisting ministries with the development of digital platforms; (iii) training public officials to use these digital solutions, including collaborating with INAP (Instituto Nacional de Adminsitración Pública), the nation- al institute of public administration to enhance digital trainings for public sector officials; (iv) working with focal points comprised of IT officials in each ministry for information exchange and coordination; (v) hosting the government servers of 14 ministries; and (vi) organizing the first conference on e-government in the country to discuss the challenges when introducing digital public platforms (Guinea Informarket, 2021). The National Institute of Public Administration (INAP, Instituto Nacional de Adminsitración Pública in Spanish) is the main body responsible for training public servants. INAP’s objec- tive is to develop and execute policies for the selection, training, and retraining of public employees. Typically, when a new tool or need for public employees arise, including the deployment of new software, the INAP is supposed to develop the curriculum to train them and hires the appropriate professors. The INAP is also in charge of planning future needs related to training on digital issues. For instance, the body is currently working on the development of an online learning platform for public servants. INAP has some autonomy, but it formally depends on the Ministry of Public Service (Ministerio de la Función Pública in Spanish). In practice, however, ministries tend to prescind from INAP and develop their own training programs, what creates duplications and increases the inefficiency of the system as a whole. 69 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Nevertheless, CNIAPGE may face significant challenges in tackling its broad roles and re- sponsibilities for the government of Equatorial Guinea. While it is placed directly under the office of the president and has administrative and financial autonomy, the center lacks the legal authority, as well as the human and financial resources to coordinate or lead the public sector’s digital development. The head of CNIAPGE is appointed by the president and carries the title of Director General but is not a Minister.18 Government executives are often reluctant to provide the necessary support for agencies or organizations mandated to coordinate, oversee, and control digitalization efforts across the public administration, as this leads to a considerable transfer of power. The establishment of a new entity can wield considerable influence over the public sector and naturally triggers opposition from other branches of the government. Governments must be aware of these political realities and empower agencies so that they can fulfill their envisioned function, while taking con- cerns and problems from stakeholders in other ministries seriously. Having a clear political champion and clear message about the importance of digital transformation at the senior government level can help identify and address some of the roadblocks that the center is currently encountering. While it wishes to be the one-stop-shop for digital public platform solutions for government ministries, CNIAPGE is struggling to fulfill this vision. With 84 employees the staff number is quite high for Africa, but it is facing capacity constraints.19 The center was not involved in the development of a strategy for the digitization of the public administration and a clear vision in how it wishes to successfully fulfill its various roles. The distinct nature of the different functions the center is tasked to address adds to the complexity of the work. Moves toward greater digitalization and informatization in the public sector are thus in- creasingly occurring in silos as ministries move ahead with planning their own platforms. Part of the reason given for this development is the extensive time it takes CNIAPGE to develop digital solutions and in some cases, ministries feel that the center is not sufficiently capacitated to understand the technical nature of the different sectors and the solutions needed. CNIAPGE may therefore wish to place a stronger focus on helping ministries in the procurement of external platforms and less on the development of in-house applications to achieve best ‘value-for money.’ Another factor affecting the institutional readiness of the country’s digital public platforms is the relatively low level of digital skills and a small pool of qualified human resources (see Digital Skills chapter for more information). While both CNIAPGE and INAP are supporting https://www.guineaecuatorialpress.com/noticias/decreto_de_nombramiento_para_melanio_ebedeng_oyana. 18   Based on Interviews. 19   70 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC the training of digital skills of public officials, progress is slow. The rollout of the new Sy- donia customs platform incurred delays as staff required to use it had to be trained, which took longer than anticipated. The public sector is also struggling to find the necessary IT skills to drive the digitalization of the sector. Digital Identification (ID) and Trust Services The Ministry of Justice is responsible for civil registration and vital statistics (CRVS) in the country, which continues to rely on analog and outdated processes and policies. As mentioned in the section on the Legal framework, CRVS legislation is based on the Spanish Civil registration act (1957) and is therefore outdated (UNICEF, 2023). Efforts are underway to update this piece of legislation, but it is unclear how far this process has advanced. The country lacks a unified, digitalized civil registry. Instead, there are seven regional offices, each collecting and storing data using manual, paper-based processes. The lack of elec- tronic civil registration records has created additional challenges in terms of increasing the coverage of the registry, the accessibility of civil registration documents for people, and leveraging this data for public administration and service delivery. The national household survey from 2023 found that only two thirds (65.7 percent) of the population in Equatorial Guinea had a birth certificate. This places the country at a similar level as Timor-Leste (60 percent) or Cameroon (62 percent) registration rate (World Bank, 2021). The survey also found large geographical differences, with the rate of certification being higher on the island of Bioko than in the continental provinces.20 Limited differences, however, were found between boys and girls. To enhance the rate of birth registrations, the Ministry of Justice in collaboration with United Nations Children’s Fund (UNICEF), helped to capacitate local judges to conduct civil registration at the commune level. The manually collected data is then shared to the 7 regional offices. This allows registration of newborns to take place locally, increasing the rate of registration, especially in the remote continental provinces. It remains to be seen how effective this policy has been in lifting the registration rate, as not up to date survey exists. The Ministry of Justice in collaboration with UNICEF launched a digital civil registry pilot called SIREC (Sistema Informático del Registro Civil in Spanish) in late 2018, exclusively in the capital Malabo. The pilot aimed to digitize and archive existing civil registry data and allow the digital registration of new births. Standardized manuals for registration of new births were also created to help collect data in the principal hospital in Malabo. According Preliminary Household survey data for 2023. 20   71 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC to UNICEF the platform is operational and functions well. The pilot also trained a team of people to assist with standardizing and subsequently digitalizing historic manual civil reg- istry data. The collected digitalized archives are not yet accessible on the same platform as the one developed to collect the new births and deaths, but CNIAPGE is working on their integration. While funding to expand the digital registry to the mainland is currently lacking, UNICEF is supporting ongoing government efforts to increase overall registration rates of newborns and establish a better communication exchange between subnational registration centers and the central government administration, capitalizing from the lessons learned of the pilot (UNICEF, 2022). Currently the civil registry does not have any interoperability either with the country’s national identity management system or any sectoral ministries that would benefit from its access. There are challenges to make the newly digitized data accessible to these in- stitutions and scaling up the digitization efforts due to a lack of data sharing agreements and data security. Equatorial Guinea has a fragmented ID Ecosystem, which is not interconnected. The Na- tional Center of Official Documents Issuance (Centro Nacional de Emisión de documentos oficiales de Guinea Ecuatorial, CNEDOGE in Spanish) issues various physical documents, i.e., National identity card (Documento Nacional de Identidad in Spanish), public official identity card, passports, foreign resident permits, and driver’s licenses. The national identity card is the country’s primary document of identification. It is associated with a unique ID number; this identifier, however, is not used as a common reference across registries or functional ID systems. National ID coverage among adults is estimated at around 63 percent (Clark et al., 2022). This compared to 73 percent in Gabon and 82.8 percent in Cameroon (World Bank, 2021). The national ID card contains a chip with biometric data but currently holds no practical use. Since 2020 nationals living abroad have been able to receive their passport at the local embassy or consulate (Realequatorialguinea, 2020). CNEDOGE uses an internal database to track the issuance of its documents which has been active since 2018. In 2022 CNEDOGE launched its website. It allows citizens to register the order of their identification documents online and is also accessible to citizens living abroad. The site only allows the registration of a request, however, subsequently citizens will still need to physically go to CNEDOGE’s office or in the case of citizens living abroad to an embassy or consulate with the required documents. Users of the platform are notified about appoint- ments via e-mail or SMS. There is currently no trust framework for the electronic authentication of individuals or businesses in Equatorial Guinea. Equatorial Guinea currently does not have any e-signature 72 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC capabilities in place. This constitutes a key barrier to the country’s digital transformation. The country’s limited identity systems and platforms also lead to higher transaction costs of delivery and receipt of public services (particularly for the most vulnerable populations) and complicates the ability of micro and small and medium enterprises (MSMEs) to access financial opportunities. Core Government Systems (G2G) Some form of IT system exists in most of the public administration; however, they operate in silos and are not interoperable. There is limited to no data transfer taking place through these systems and the little data being transferred is usually done through e-mail exchang- es. Currently, most applications operate only at the central level and there is no centralized data center for the whole government. Ministries either host their data centers themselves or through CNIAPGE’s. Some ministries procured their required software from international vendors on their own, while others have collaborated with CNIAPGE on locally developed applications. Multilateral support through the UN and African Development Bank (AfDB) provided tech- nical assistance when procuring digital solutions for the public administration. It is unclear, however, whether ministries received such procurement support and what determined their decision to work with CNIAPGE or a private sector vendor. Financial Management System The GoEG lacks an integrated financial management system (IFMIS), but rather several systems, mostly operating in silos, managing different financial management functions. An IFMIS is currently being introduced through a loan from the African Development Bank, under a project called Public Finance Modernization Support Project (PAMFP). The project is set to conclude in 2025 and aims to strengthen non-oil revenue mobilization and support public expenditure effectiveness and control, via payroll and accounting modules. Currently, the Treasury uses the SAGE Business-Cloud-X3 system as its main financial man- agement system. As part of PAMFP, the treasury is collaborating with the Bank of Central African States (BCAS) to upgrade the current SAGE X3 system and introducing the SAGE XRT Treasury system (launched in 2015)21 to add additional applications and functions such as 21   https://www.sage.com/investors/investor-downloads/press-releases/2015/06/29/sage-adds-business-intelli- gence-and-mobility-to-sage-xrt/. 73 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC an automated payroll system. For single large transactions, the treasury uses the SIGMA system and for international payments the Alliance Access Integration Platform (IPLA) as part of the SWIFT payment system. Deconcentrated offices of the treasury are linked to the central treasury through a system called Monetica. The treasury also uses an internal data archiving system to manage its internal files. The Budget Department at the Ministry of finance (MoF) does not currently draft its budgets in a digitally-integrated manner. While it is using an internal system to monitor budget implementation it is not connected or interoperable with the Treasury and as such requires manual checks with the latter to ensure that expenditures are reflected in the budget imple- mentation. Likewise, the collaboration between the different departments at the ministry cannot rely on digital tools. Intranet system is currently being developed for the Ministry through PAMFP. One of the major challenges that the treasury is encountering is the formalization of fi- nancial management processes with an internal organic regulation, which is currently still missing. For this formalization to be effective a reform committee at the MoF would need to ensure that new business processes would be codified, and their use and implementation be monitored, which is currently not the case. The absence of these formalizations creates a greater fragmentation of digital systems in use and increases the challenges to make them interoperable with each other. As part of PAMFP the government has also decided to join the Debt Management and Fi- nancial Analysis System (DMFAS 6). The system which is developed by UNCTAD and used in 61 countries, is also used in Gabon, and the Rep. of the Congo. It helps monitor debt payments and contributes to improve the overall management of government expenditure (UNCTAD, 2023). The software was installed in early 2023 in the Autonomous account for the amortization of public debt (Caja Autonoma de Amortizacion de la Deuda Publica – CAADP in Spanish). It is designed to help countries manage their external and domestic debt and improve their standing with international financial institutions and private lenders. It covers all debt, and the aim is to integrate it into the broader SIGFIP system the country is beginning to roll out. However, it is not currently interoperable with any other system at the Treasury or MoF. Revenue Management The Equatorial Guinean directorate general of customs piloted the Automated System for Customs Data Sydonia World Software beginning in 2018 with the support of UNCTAD. The importance of its implementation was further underlined by a presidential decree from 74 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC 2020 in the wake of the Covid-19 pandemic instructing the MoF to ensure the mandatory use of the system in the Customs jurisdiction of Malabo. Sydonia currently contains the modules on customs declaration, payments, and statistics. The software is only active at ports of entry in Malabo (both sea and air) and only operational for 40 percent of transac- tions. The rest of customs transactions are still manual. The Minister of Finance and Budget stated in April 2023 that some public officials were resisting the use of Sydonia in their work and that the Ministry is keen that all customs transactions are processed through Sydonia. The minister also confirmed that issues related to inadequate training should be addressed (Ministry of Finance and Budget of Equatorial Guinea, 2023b). Sydonia is the only system with some form of interoperability with the treasury. Customs data on imports and exports processed are directly submitted to the treasury. Since the SAGE XRT Treasury system enabling real-time payment monitoring with banks is not yet operational, importers and exporters still need to manually confirm that they have made their customs payments before the goods can be released. The relatively low percentage of transactions conducted using the system can be explained by bottlenecks in training customs officials and that several goods categories are not yet registered in the system and as such need to be processed manually. The rollout of the Sydonia system is also important as it aligns with the IMF’s latest loan program to the country. The program includes a focus on improved governance and anti- corruption and one of the agreed-on measures is the introduction of a computerized system for tax information (IMF, 2022). The program also requires implementing measures that lead to greater transparency in the state-owned hydrocarbon companies and the regular publication of data (IMF, 2019). Human Resource Management System (HRMS) Equatorial Guinea currently lacks a national HRMS. While CNIAPGE stated that they had developed their own HRMS, it is currently not operational at the ministry level. Human resources are managed by non-interoperable systems and ministries are using their own, siloed spreadsheets to keep track of staff numbers and turnover including the ministry of public administration which is responsible for issuing IDs for civil servants. The Treasury in charge of payroll uses their own Excel spreadsheets with all the salaried information of public officials. This information is shared with all the commercial banks where staff request to receive payrolls using USB flash drives. The balance is then deduct- ed from the treasuries account it maintains with the respective bank. The system clearly 75 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC poses significant risks including transfers going to unintended recipients, ghost workers or incorrect amounts being transferred to recipients. E-Procurement System Equatorial Guinea currently does not have an electronic procurement system due to legal and regulatory hurdles. All public purchases and contracting are done through manual processes. The government is currently in the process of reviewing its procurement law, leveraging the assistance provided by the World Bank.22 The draft procurement law, which was submitted to the government last year, would provide the legal foundation to permit the introduction of an e-procurement system. Sectoral Core Government Systems The following systems help sectoral ministries fulfill core government functions at the sectoral level. Ideally such systems would be interoperable with other information sys- tems. However, as described below, there are currently no sectoral systems that fulfill this requirement. Health Core Government System The ministry of health currently does not have a digitized national system of sanitary information. Data collection about diseases such as HIV or Malaria, is done manually and cannot be accessed centrally making tracking a difficult task. The ministry plans to work with the DHIS2 platform, a WHO (World Health Organization) approved open-source soft- ware platform used in many developing countries, which would help to implement universal health care access and improve the governments understanding of health issues affecting the population. The ministry states that the goal is to pilot the system in 2023. Social Protection Delivery Systems The Institute of Social Security (Instituto Nacional de Seguridad Social in Spanish or INSESO) oversees the national social security system for contributory social protection. Current legislation only covers formal sector employees with contributory pensions, although a more comprehensive Social Protection Law envisioning the provision of both non-contrib- Public procurement component of the “P172301: AWCC1 Governance Programmatic ASA” closed June 30, 2022. 22   76 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC utory social assistance and contributory social insurance is under preparation. People with disabilities were covered by social insurance in 2004. The current system provides several types of pensions: family subsidies, people with work disabilities, pregnancies, and other types of pensions. Since 2008 INSESO has worked with an electronic database and a social security number system which is given to every contributing person. Internally there is some intercon- nectivity between headquarters in Malabo, and the office in Bata. Other local offices still operate on paper-based systems and then report their registrations to the office in Bata. INSESO also issues insurance cards, whose social security numbers differ from the num- ber on national identity cards. The system counts a total of 122,936 beneficiaries, of which 74,797 contribute as formal workers. The Institute is planning to establish an online presence which would allow users to access their personal details. Currently there is no interoperability with any other government databases. According to the Ministry of public administration there are ongoing conversations to integrate the payment system on the SOL platform (see paragraph 106. The current system is trust-based, and new members are registered by using their birth certificates. The ministry of social affairs and gender is likewise providing social assistance to families in great need. Like INSESO it maintains its own internal database of persons and families which are eligible for funds, which is not interconnected with any other government system. Social assistance programs, including those specifically targeting vulnerable households, currently have minimal coverage. At present, social assistance programs implemented by the government are small-scale, and complemented by schemes from organizations, such as NGOs and churches. Social assistance falls under the mandate of the Ministry of Social Affairs and Gender (MINASIG), which like INSESO it maintains its own internal database of persons and families which are eligible for funds, which is not interconnected with any other government system. To respond to the COVID-19 crisis, MINASIG adopted a social protection response program to protect vulnerable populations. The program was financed by the IMF with technical support from UNICEF. It provided a package of socio-economic measures including a food basket, basic personal hygiene kit, and social support for 6 months targeting to around 35,000 direct beneficiaries. During the pandemic, MINASIG began working on a registry of vulnerable households called the Registro Unico Social (RUS). Equatorial Guinea’s first Social Protection Law is currently under preparation, highlighting the RUS as a critical tool. The law tasks MINASIG with the responsibility for coordinating 77 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC social protection system23 in collaboration with relevant Ministries and with RUS as a co- ordination tool. Currently, the RUS architecture consists of a web portal, a web application, and a mobile application. The web portal is designed to be accessible by the citizen to ob- tain general information needed to register in the RUS. The web application is the main RUS administration tool while the mobile application is designed as field tool to conduct data collection.24 Although there is a URL page for the web portal, it is not currently accessible. Interoperability of systems is necessary for social registries to communicate with other administrative systems and the data needs to be uniquely identified across systems to enable linkages.25 There is a vision for the RUS to be interoperable with other databases, in support of its mandate as a coordination tool for social protection. Public Service Delivery Systems (G2P G2B) There are currently very few digital public platforms that provide services to population and businesses in the country. The lack of concrete plans to accelerate a whole-of-govern- ment approach to public service digitalization, and the absence of a public service inventory and plans to gradually transition from offline to online services, makes a change in the short term unlikely. Public Administration The Ministry of Public Administration in collaboration with UNDP developed the SOL plat- form, which runs on UNDPs SIGOB platform and has been used successfully in other coun- tries primarily in Latin America. The platform was launched on the website of the ministry of public administration as a pilot. It offers government employees the ability to order four types of documents: ‘Recognition of 3-year service’, ID for government employees, certifi- cate of seniority and certificate of specialization. Initial feedback on the platform has been very positive, especially from public officials working in rural parts of the country. The objective of SOL is to expand its functionalities and allow citizens to submit online requests for official documents issued by the Ministry and link its services to other ministries for even greater functionalities. Further specified in the Law as the set of policies and programs on social protection. 23   RUS Presentation by MINASIG, shared during World Bank Social Protection mission in Malabo, April 2023. 24   Lindert et al., 2020. 25   78 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Health Portal The ministry of health does not currently possess a digital public platform for citizens or businesses. However, it has developed a patient management system for the use of health facilities (G2B) in the country. The system is modular, each module corresponding to a health service currently being provided by the different health facilities across the country. The platform is meant to be used by both public and private health facilities and will contain personal health information of citizens using any of the facilities. The platform will allow citizens to easily move from one health facility to another and health care providers will be able to access the health records centrally. It will provide differentiated access to labo- ratories, doctors, and administrative staff to protect the patients’ data integrity. The system, tested in the largest hospital in Malabo, is currently not yet operational. Jobs Portal Equatorial Guinea has not currently built a national jobs portal, where citizens can find job postings due to a lack of adequate legislation. Except for a few international positions and positions in the oil and gas industry which can be found online, most employment opportunities in the formal economy are published via Radio and TV. Import/Export Portal The import/export process starts with the registration of a cargo manifest, using the in- formation sent automatically by a registered cargo agent through SYDONIA. The platform then registers all taxes and levies that are calculated by a team of experts and issues a payment notification for the trader. This information is also transmitted to the Treasury. The cargo agent will then need to make the payment at a designated commercial bank to an account of the treasury. Once the payment is confirmed the customs authorities will receive clearance orders and the goods can be processed. Civic Tech Equatorial Guinea has not currently established digital platforms for citizens to voice griev- ances, ask questions to the administration or provide feedback. While many ministries such as the ministry of health (https://guineasalud.org), the ministry of public administration (https://minfuncionpublica.gob.gq) and the ministry of finance (https://minhacienda-gob. com) have their own websites, the information provided to the public is usually limited to publishing decrees, laws or providing general information about the role, scope of work 79 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC of the ministry and operational news of the ministry. Maintenance of website fluctuates with some offering relatively old or outdated information to citizens such as the site of the country’s Senate (https://senado-gq.org) which seems to have been last updated in 2017. Many of the ministries which maintain a website also have a Facebook presence where they also communicate ongoing news to the public. The country is far from producing a unified web-presence and while the domain name gob.gq exists since 2018 few government ministries make use of it. CNIAPGE has raised this concern with the ministries and is promoting the unification of the different web-pres- ences under a unified domain name, but this is currently not yet forthcoming. Some of the government sites provide information on public data. The website of the national health ministry for instance includes a section on statistics on Covid-19 vaccination rates and case numbers. Interoperability and Shared Services Digital Public Platforms in Equatorial Guinea are for the most part not interoperable with a few exceptions (i.e., SYDONIA). The government does not possess a national interoper- ability framework, or a government enterprise architecture framework and public sector systems do not communicate with each other. There is also no interoperability platform (or a data exchange layer). Punctual initiatives have achieved some level of interoperability like the rollout of the SIGFIP system. Nevertheless, this is done ad hoc and based on the respective Ministry’s needs, without coordination from the central government. According to CNIAPGE the government wishes ministries to use an Enhanced Interior Gateway Routing Protocol (EIGRP) using the Open-Source system available on the protocol. This has yet to be introduced, however. As discussed in previous sections government servers are either located at CNIAPGE or directly with the ministries. A holistic government cloud platform accessible to all ministries is not yet available. Equatorial Guinea does not currently have a comprehensive vision for data governance. The country lacks a common data framework and data sharing protocols. With many minis- tries at the center operating on manual systems this is even more pronounced at the local level due to insufficient funds and inadequate infrastructure. The central network of the government, partly hosted by CNIAPGE, does not extend to local government branches and data sharing that is taking place between ministries is either done manually, via USB-drive or e-mails. 80 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Box 6 The case for interoperability and how to achieve it Timor-Leste while lacking an interoperability framework, the government has under- taken efforts through its National Connectivity Project to improve the connectivity between the central government and local administrative entities, by introducing a national intranet platform, headed by the Ministry of Development and Institutional reform. The platform is set up as a root information system to expedite communication between the central government and local municipalities. In Cabo Verde, the Information Society Operational Unit (NOSI), a public enterprise, devel- oped the IGRP (Integrated Government Resources Planning) system. The IGRP system is a client-oriented technology that provides integrated packages of governance solutions. Being delivered as a service model (PaaS), the platform allows public sector entities to use its services without having to deal with necessary ICT infrastructure. The progres- sive adoption of this platform by public sector institutions of Cabo Verde has created greater interoperability from different sectors of government, enhanced communication and shared information. Moreover, Cabo Verde also created a state-owned technology network that connects virtually all public sector entities, allowing them to access a range of services citation OEC18 \l 1033 (OECD, 2018). Box 7 The digital journey of the government in Thailand To provide formal ministerial support and enforce sound governance structures, Digital Government Agency (DGA) has developed an ad hoc document in 2018, emphasizing the importance of data in key policy lines for the country, namely, digital economy and society, while addressing the most relevant challenges this process entails. The Data Governance Framework defines data governance as “a mechanism for determining the direction, control and verification of the management of data, such that the data are secure, of quality, cost-effective, and economically and socially valuable, and the ac- quisition and use of government information are accurate, complete, current, safe and private.” The document aims to provide standards in supporting government agencies to build the foundations of the digitalization process of data collection, data sharing, data distribution, and data exchange. Source: OECD, 2022. 81 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Summary of Constraints for Digital Platforms Institutions and Leadership: Despite having a national agency for the digitalization of the public sector (i.e., CNIAPGE) its impact is constrained due to capacity challenges, factors in the political economy and a lack of a digital strategy with clear metrics that the agency is meant to fulfill. While the agency maintains focal points with the different ministries com- munication and coordination seems to be ad hoc and a common vision which is supported by all public entities on how to progress with the digitization of the public sector is lacking. Insufficient Legal and Policy Framework: Critical policies and laws (i.e., procurement, data interoperability and sharing frameworks, cybersecurity, and access to information) are missing or outdated. The absence of a legal and regulatory framework makes the introduc- tion of new digital public platforms challenging and raises concerns about data security and data use. Lack of interoperability among digital public platforms: There is no national interoperabil- ity framework, and with few exceptions, digital platforms do not communicate with each other. The enterprise architecture to underpin greater interoperability is inadequate and incomplete. The lack of interoperability lowers overall efficiency of the public sector and strengthens a siloed approach. Limited data sharing between ministries: Data collected in one ministry is mostly inacces- sible to other ministries (i.e., civil registry), the research yielded no shared platforms inside the government to host government systems across line ministries. Potential synergies that different public entities could gain from sharing data with each other are therefore lost or require time and effort to obtain. No foundations for digital identity: The emergence of digital identity is hampered by the weaknesses of the foundational identification system and the lack of a trust framework for digital authentication. Public entities continue to rely on manual documents for identifica- tion creating inefficiencies and opportunities for fraud and placing a larger administrative burden on people when accessing services or transactions that require a proof of identity. Limited public sector digital and data skills: Digital and data literacy and IT skills are still quite low in the public sector, limiting the adoption, use, and sustainability of existing and future public platforms. Experience from other countries shows that capacity building and training can help get public officials acquainted to digital systems but that this process takes time and need to be accompanied by organizational changes in adapted work procedures. 82 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC 2.3 | DIGITAL INFRASTRUCTURE RECOMENDATIONS DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION LEGAL, POLICY, AND REGULATORY FRAMEWORK Strengthen Legislative and Regulatory Framework: Many of Equatorial Guinea’s public administration laws are outdated and no longer adequate for a modern public administration which uses digital tools and platforms to operate. In some cases, extant laws require additional legislation to be effectively implemented (i.e., Personal data protection law without a corresponding cybersecurity law). A legal Equity, Policy Medium- foundation can provide the necessary impetus towards Inclusion Reforms Term reforms. Monitoring of existing laws helps to ensure that the regulatory framework envisioned by the new laws is actually being adhered to and that new policies adapted to digital solutions are being implemented. While this recommendation takes time it is highly advisable that it be given particular priority as it underpins the entire reform process. GOVERNMENT STRATEGY Development of a national Strategy for digital public platforms: The government may build on the existing strategies such as ADIGE and UNDP’s e-government strategies and ensure that existing gaps such as data- management, interoperability, citizen-centric public platforms and other relevant themes are also addressed. This could be achieved by an expansion of these existing Policy strategies or the creation of a stand-alone e-governance Productivity Quick-Win Reforms strategy. The national strategy should be aligned with the country’s overarching development agenda and provide tangible and feasible goals within a defined time horizon. It could be embedded in the “Agenda Guinea Equatorial 2035” or published independently. Digital public platforms can help enhance public service delivery, transparency, and citizen engagement and any strategy should be user-centered. Establish data governance by increasing data availability, collection and analysis to improve policy making and create good governance. Developing a data framework can help lay the foundation for improved data governance. It helps to delineate the kind of data that the public administration is to collect Equity, Policy from core government systems, how to protect the data from Long Term Inclusion Reforms unwanted access, it identifies responsibilities and standardizes data collection procedures across all government branches. The data framework should be aligned with the national strategy for digital public platforms and the legal framework surrounding the collection and use of data by public officials. 83 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION LEADERSHIP AND INSTITUTIONAL READINESS Strengthening the digital skills capacity of the public sector: Several public entities independently stated that lack of qualified human resources was a serious impediment to introduce digital public platforms. To this end the government should establish a methodology to evaluate and monitor the skillset of the public sector’s digital skills. This would (i) establish a baseline of the public servants’ Medium- Productivity Capacity skillset, which is necessary to properly develop a digital Term skills policy and program aimed at re- and up-skilling them, and (ii) monitor their progress to determine whether new courses and programming are achieving impact (and course correct as need be). The methodology should be developed in collaboration with the relevant agencies and include INAP and CNIAPGE. Re-evaluate the role and function of CNIAPGE: The national center for the digitization of the public administration in Equatorial Guinea clearly plays a crucial role in driving forward reforms, but it is also over-extended in terms of its responsibilities and lacks the political power to drive greater coordination between different ministries and Policy Productivity Quick-Win strengthen a much desired whole-of-government approach. Reform The government may wish to re-evaluate the Centers strengths and mandate and how its vertical structures can be improved with horizontal inter-ministerial coordination. Any such reorientation should be well embedded in the overall digital strategy the government wishes to pursue. DIGITAL IDENTIFICATION (ID) AND TRUST SERVICES Fully digitalize the civil registry, to improve the accessibility, verifiability, and quality of data: With the pilot of the digital civil registry in Malabo, the first steps for the expansion of the digitalization of the civil registry was laid. Building on the experiences from the capital, civil registration should be digitalized nationwide. By enabling Equity Medium- digital data entry and establishing a digital database (or Investment Inclusion Term interconnected databases) of civil registration records that can support secure, electronic data exchange, the trust in and accuracy of other databases relying on identity data such as CNEDOGE and INSESO would be strengthened. Remaining gaps in the completeness and timeliness of civil registration should be addressed as well. 84 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION Increase the accessibility and digital capabilities of the National ID system: A trusted and inclusive identification system that enables unique identification and digital authentication (and is aligned with the Principles on Identification for Sustainable Development) can improve effective service delivery across multiple sectors. Among others, it can serve as a core enabler for the development of a national social registry, including: (a) accurate identification and registration to avoid ghost records and Equity Medium- duplications in social registries or data basis of beneficiaries; Inclusion Investment Term (b) interoperability between social registry and other Productivity beneficiaries or administrative registries to allow for both rapid selection and enrollment but also for automatic cross checks and frequent updating of data as opposed to more prevalent census type of data collection requiring face to face visit to households; and (c) enable electronic payments through more streamlined account opening and verification processes (Gov to People, People to People, People paying for goods and services using Point of Sales/POSs). INTEROPERABILITY Achieve greater interoperability between digital public platforms (whole-of-government approach) by introducing an interoperability framework and a subsequent interoperability platform or data exchange layer. This framework specifies a set of tailored common, government-wide principles, standards, and practices that all government agencies Medium- should adopt and utilize for the purposes of joint delivery of Productivity Investment Term public services. Such a framework consists of four layers: legal, organizational, semantic, and technical interoperability. The ability to link administrative databases using unique identifiers has been an important factor in allowing countries to respond quickly and effectively to service delivery challenges for instance during emergencies, such as natural disasters. 85 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC @ Yuri A / Shutterstock Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC 3 | DIGITAL FINANCIAL SERVICES 3.1 | IMPORTANCE Digital Financial Services (DFS) are reshaping the access, use and control of financial ser- vices by individuals and businesses. Over the past decades, DFS have played a critical role in enabling vulnerable groups of population previously excluded from or underserved by the formal financial system. DFS encompass a wide range of financial services and products. According to the Global Findex 2021, account ownership around the world increased by 50 percent between 2011 and 2021 (from 51 percent to 76 percent of the adult population). At global level, the case of Sub-Saharan Africa is a prime example of the impact of DFS in advancing financial inclusion. In 2021, over half of the adult population in Sub-Saharan Africa (55 percent) owned an account, including a third of adults who owned a mobile mon- ey account. This percentage represents the highest share of any region globally and three times the global average of mobile money account ownership (10 percent). In this context, DFS have become a cost-effective way for Financial Service Providers (FSP) to reach out to low-income groups, rural dwellers as well as other vulnerable groups. On the one hand, it enables them to not only lower operating and transaction costs but also to achieve productivity gains. For instance, the introduction of electronic Know-Your-Customer (e-KYC) procedures can reduce the customer onboarding costs of FSPs by 90 percent.26 On the other hand, access to the formal financial system enables individuals and business- es from previously excluded market segments to make a better use of their finances, to engage more effectively in financial planning and to build financial health and resilience especially in times of crisis. However, the use and rapid expansion of DFS also entail risks such as financial stability-related risks, cybersecurity risks and other consumer risks such as digital fraud or privacy intrusion. These risks need to be addressed through mechanisms that foster a culture of transparency and accountability to build trust in the formal financial system. As described in the diagnostic findings section, a myriad of stakeholders such as regulators, financial service providers and consumer protection associations have a key role to play in creating an enabling environment for the development and uptake of more inclusive DFS, especially in countries (such as Equatorial Guinea) that are lagging in the development of such a DFS ecosystem. McKinsey Global Institute, Digital Identification A key to inclusive growth, April 2019. 26   87 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Due to the rapid pace of technological change, DFS now encompass a wide array of financial products and service spread across different generations. The first generation of DFS refers to products and services which have been traditionally enabled by mobile technological innovations such as online top-up, instant airtime recharge, peer-to-peer (P2P) transfers, electronic bill payments and cash-in and cash-out transactions. The second generation of DFS gradually extended to microproducts such as micro-credits and micro-insurances, merchant payments and international remittances. From a technological innovation per- spective, the DFS category is composed of both traditional instruments (such as debit and credit cards) and more recent products and services enabled by the cloud, digital platforms, as well as Distributed Ledger Technologies (DLT) and crypto. 3.2 | DIAGNOSTIC FINDINGS: CURRENT STATE OF DFS The following chapter discusses the current state of DFS in Equatorial Guinea. It first looks at access to formal financial services, with a greater emphasis on access to DFS. The chapter then focuses on the development of the DFS market in the country, including aspects such as market concentration, risks, and vulnerabilities. The chapter continues with an analysis of the country’s overall DFS policy and regulatory framework, with a more granular as- sessment of policies and regulations related to market entry and risks related to the use of digital finance. To conclude, the chapter sheds light on the country’s financial infrastructure and ends with a summary of key constraints to DFS growth. The following Table helps stress the fact that Equatorial Guinea needs to strengthen its data coverage on digital financial services. Currently there is no data available from the Global Findex 2021 survey for Equatorial Guinea, which makes it difficult to assess where the country stands in terms of access and usage of DFS compared to its structural and aspira- tional peers. Data unavailability is a recurring trend when it comes to statistics related to DFS in Equatorial Guinea. At the national level, there is no demand-side survey capturing (household or individual-level) data to measure financial inclusion from the point of view of users of financial products and services. Serious data gaps are also observed on financial literacy in the country. On the supply side, the latest available data for Equatorial Guinea from the Financial Access Survey (FAS) of the IMF were from 2020 (data for the last two editions of the survey are unavailable). In addition, FSPs active in Equatorial Guinea do not report data to the Microfinance Information Exchange (Mix) Market platform, the leading data hub on the microfinance industry. 88 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Table 11 Digital Financial Services Indicators Benchmarking STRUCTURAL PEERS ASPIRATIONAL PEERS CAR (Central African Timor-Leste Congo Rep. Azerbaijan Costa Rica Cameroon Singapore Mauritius Republic) Gabon Qatar EQG UAE INDICATOR ACCESS Percentage of adults with 14% 29% access to a  N/A 18% 28% 24%  N/A 85% 68% 97% 90% N/A (2017) (2017) transaction account USAGE Percentage of adults who made 6% 10%  N/A 43%  62% 48%  N/A 75% 53% 91%  64% N/A a digital retail (2017) (2017) payment in the past year Source: World Bank, Findex 2021. Access to Formal Financial Services The rate of access to formal financial services in Equatorial Guinea remains low compared to the average rate for both low-and middle-income countries as well as upper middle-in- come countries. According to national data27, the rate of access to formal financial accounts (or financial inclusion rate) stood at 31 percent of the adult population in Equatorial Guinea in 2019. At the regional level, Equatorial Guinea’s financial inclusion rate was on par with the performance of its regional peers in 2017. According to Global Findex data, the formal account ownership rate was 14 percent, 22 percent, 26 percent, 35 percent and 59 percent for the Central African Republic, Chad, the Republic of Congo, Cameroon, and Gabon, re- CNEF Informational Note on the banking and financial environment in Equatorial Guinea, December 2019. 27   Note: The bank penetration rate corresponds to the number of active accounts held by natural persons as a percentage of the total workforce. 89 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC spectively, in 2017 (see the Figure below). However, compared to its global economic peers, Equatorial Guinea’s rate of access to formal financial accounts stood well below the average for low and middle-income countries in 2017 (63 percent). In addition, Global Findex data available for Equatorial Guinea’s regional peers in 2021, demonstrated that their financial inclusion rate followed a steep increase between 2017 and 2021 (with a growth of 21 per- centage points (p.p.), 17 p.p. and 7 p.p. respectively for the Republic of Congo, Cameroon and Gabon)28. Overall, national data from 2019 show that only one-third of the adult population had opened a bank account in the formal financial sector, 40 per 1,000 adults had received a bank loan, and 79 per 1,000 adults had a debit card (CNEF - Comité Nacional Económico y Financiero, 2019). While these figures are relatively low, available statistics on financial access in Equatorial Guinea n upward trend. The share of the adult population with an ac- count increased from 167 to 293 (per 1,000 adults) between 2013 and 2019 (IMF, 2020). Figure 12 Bank Account holding in the CEMAC countries29 71% 66% 63% 59% 52% 47% 35% 31% 26% 22% 14% Cameroon Central African Chad Congo Equatorial Gabon Low and Middle Republic Republic Guinea Incomev 2017 2021 *No data available for EQG for 2021 The gender gap in access to a financial account in Equatorial Guinea has narrowed signifi- cantly but remains considerable. In 2020, there was a gender gap of about 6.5 percentage points (in favor of men) in deposits held in a commercial bank (244 women compared to 28  World Bank, Global Findex, 2017/2021. The figures shown are indicative since they are from different sources, due to the absence of data for Equatorial 29   Guinea from the Global Findex Survey. The figures for all countries (except Equatorial Guinea, which comes from CNEF Note) are taken from the Global Findex survey (2021), which limits comparability. 90 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC 309 men per 1,000 adults holding deposits in a commercial bank) (IMF, 2020). In addition, financial education is not part of the official school curriculum, and many segments of the population (such as low-income women) have never received financial education trainings in Equatorial Guinea. Access to Digital Financial Services In Equatorial Guinea, DFS in general, and electronic means of payment in particular have not experienced the boom in development observed in neighboring countries in recent years. FSPs operating in Equatorial Guinea were late adopters of digital trends and con- tinue to lag behind in the development and commercialization of DFS. Consequently, the use of cash remains deeply rooted in the culture. Overall, on the one hand, the use of the first generation of DFS remains nascent in the country (i.e., mobile money products are not available while basic mobile banking solutions are slowly being launched). On the other hand, the second generation of DFS (i.e., digital credits and insurances) is barely in the de- velopment stage. Despite the recent growth in the ownership of debit or credit cards, the overall ownership rate of these payment instruments remains low, with 79 credit cards per 1000 adults in 202030, a slight decline compared to 83 in 2019 (IMF, 2020). Only one e-money provider was granted a license to operate in Equatorial Guinea. Until mid-2023, Equatorial Guinea was the only CEMAC country with no licensed e-money oper- ators. However, the development of mobile money is at the origin of significant advances in financial inclusion in CEMAC countries which therefore constitutes an important oppor- tunity for Equatorial Guinea to tap into to accelerate the level of financial inclusion among the country’s population. At the regional level, 16 e-money issuers were operating in the CEMAC in 2020. The rate of access to an account in the region increased by 22 percent between 2019 and 2020. However, the rate of inactive accounts stood at around 40 per- cent in the region. In terms of geographic coverage, the number of access points of mobile money services increased continuously at the regional level, with a growth of 40 percent only for the year between 2019 and 2020. (IMF, 2021) E-money (or mobile money) services remain emergent in Equatorial Guinea. Muni Dinero is the first mobile money solution expected to be launched in Equatorial Guinea following the reception of an official license in the middle of the year 2023 to operate in the country. Muni Dinero representatives are therefore focusing on the commercial launch of Muni Dine- ro and related marketing activities, Mobile money services are expected to gain momentum Data on the number of debit cards per 1000 adults are not available. 30   91 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC in the near future in Equatorial Guinea since at least two other entities have shared their plans related to the market launch of their mobile money product or are currently waiting for a license to operate. Box 8 First Humanitarian Cash Transfer (HCT) program in Equatorial Guinea in response to the Bata Explosion of 2021 In 2021, the Ministry of Social Affairs of Equatorial Guinea and UNICEF agreed on a partnership to launch an electronically assisted cash transfer program for families affected by the Bata explosion in Equatorial Guinea. UNICEF partnered with the telecom operator MUNI to leverage on SIM card registration data to identify pro- gram beneficiaries and to send them a unique code on their mobile phones which could be used to withdraw the allocated funds from UNICEF at an ATM. A UNICEF report states that 300 families have benefited from this Humanitarian Cash Transfer program. Furthermore, according to monitoring indicators in the post-distribution phase, the amount provided was used by families to cover basic needs, including home repairs, food, hygiene items, childcare, transportation, and education costs. Source: UNICEF, Country Office Annual Report 2021, Equatorial Guinea The Equatorial Guinean banking sector is lagging behind in the development and com- mercialization of DFS. According to the central bank, only one bank has received the au- thorization to issue and manage e-money. Less than half of the banks active in Equatorial Guinea have launched mobile banking solutions. The COVID-19 pandemic and the measures implemented in the country to reduce its spread served as a catalyst for the digital trans- formation of banking products and services in Equatorial Guinea. In an attempt to optimize their operations and to deliver added value to their existing and prospective clients, the banks operating in Equatorial Guinea have all begun to embrace the global trend towards digitalization. However, the digital transformation of their offerings requires an operational and cultural shift towards the integration of new technologies into banking processes, which has become a lengthy process for all banks in Equatorial Guinea. 92 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Equatorial Guinean banks have only introduced first-generation DFS, with more advanced digital products and services still in the conception stage. All banks in Equatorial Guinea offer debit cards and credit cards.31 The most common DFS offered by banks include on- line balance and recent transactions inquiry, online payments and transfers (usually at the national and CEMAC levels) as well as electronic messaging with bank officers or to file complaints. Digital banking also allows customers to receive bank-related documents (such as bank account statements), that would otherwise be difficult to send in the absence of a proper postal addressing system in Equatorial Guinea. In the medium term, several banks intend to launch more advanced digital banking services such as digital credits. A few banks have also partnered with international Fintech companies to test solutions leveraging al- ternative data sources for credit scoring. To date, no plans to launch solutions for remote account opening through e-KYC have been made public in Equatorial Guinea. Even though the Equatoguinean government adopted a law on electronic signature in 2017,32 the country still lacks a regulatory framework for the certification of the electronic signatures. Table 12 Determining the Current State of Selected Digital Financial Services CURRENT STATUS DIGITAL FINANCIAL SERVICES UNDER NOT OFFICIALLY AVAILABLE DEVELOPMENT PLANNED Credit cards / Debit cards ATMs (Automated Teller Machine) Mobile Payments and Transfers Internet and Mobile Banking Cross-border payments (CEMAC) Cross-border payments (Global) Mobile Point of Sale (PoS) Digital credits E-KYC Digital insurance Source: World Bank. Debit/credit cards can be either VISA or GIMAC cards (accepted both at CEMAC and international levels). 31   Ley Núm. 2/2.017, de fecha 10 de enero, de Firma y Documentos Electrónicos. 32   93 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC The geographic coverage of financial services distribution points (i.e., bank offices/branches and ATMS) has considerably increased in Equatorial Guinea over the past decade. Between 2010 and 2020, the number of bank branches has been multiplied by 3.5 (from 15 to 53)33. Regarding ATMs, their number was multiplied by 6.5 (from 17 to 112)34 during this period. ATMs are not all interoperable and they mainly allow cash withdrawals but not all of them allow deposits. According to BEAC data, around 38 percent of bank offices and half of the number of ATMs are located in the province of Bioko Norte, the province of the capital city Malabo where 25 percent of the population lives. In contrast, around 25 percent of bank offices and 30 percent of ATMs are located in the Littoral Province, which is home to 30 percent of the population and includes Bata, the country’s most populated city. As presented on the table below banking agencies and ATMs are mostly located in urban areas of the countries such as Malabo and Bata while rural areas remains underserved in terms of access to financial services access points.35 33  Source: IMF, Financial Access Survey 34  Source: IMF, Financial Access Survey 35  Source: BEAC data 94 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Table 13 Geographical distribution of ATMs and banking agencies by province in Equatorial Guinea NUMBER OF BANKING AGENCIES NUMBER OF ATMS PROVINCES DISTRICTS IN 2022 IN 2022 Anobon Anobon 1 Not specified Malabo 22 61 Bioko-Norte Baney 1 1 Luba 1 1 Bioko-Sur Riaba 2 1 Evinayong 2 2 Centro-Sur Akurenam 1 0 Niefang 1 1 Micomeseng 1 1 Kie-Ntem Nsok somo 1 1 Ebebiyin 4 5 Bata 13 36 Litoral Kogo 1 0 Mbini 1 0 Mongomo 3 7 Nsork 1 0 Wele-Nzas Akonibe 1 0 Anisok 3 3 Oyala 1 2 TOTAL 61 122 Source: BEAC. Market Development The Equatorial Guinean financial sector is small and dominated by commercial banks. The financial system is composed of five banks (namely, BGFI Bank Equatorial Guinea, Ban- co Nacional de Guinea Ecuatorial (BANGE), CCEI BANK GE, ECOBANK and Société General Equatorial Guinea) and two microfinance institutions, namely Atom and Bonafide. However, the Group Société Générale announced in June 2023 the signing of agreements to sell its 95 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC subsidiary in Equatorial Guinea to the group ‘Vista’ by the end of 2023.36 Both credit and savings represent only 15 and 17 percent of GDP, respectively.37 The majority of the banks are privately owned and constitute bank branches or subsidiaries of international banks. On the other hand, BANGE (the National Bank of Equatorial Guinea) and CCEI Bank GE are the only banks headquartered in the country and with the state as its majority shareholder, with 64 percent and 76 percent of the capital, respectively. The state is a shareholder in all banks located in the country except Ecobank GE.38 The banking sector has shown early warning risks and vulnerabilities, especially during the COVID-19 pandemic. The impact suffered by commercial banks in Equatorial Guinea during the pandemic is still prevalent. The Central African region has the highest ratio of non-performing loans (NPL) and the lowest profitability in Sub-Saharan Africa (EIB, 2022). In addition, Equatorial Guinea is the only CEMAC country whose capital evolution was neg- ative in December 2021 (and since December 2019). Non-performing loans decreased by 4 percent and stood at 6 billion (FCFA) in Equatorial Guinea, however immobilized loans increased by 18 percent to reach 60 billion (the highest amount among CEMAC countries). (BEAC 2021) Equatorial Guinea has not developed significant capacity in microfinance institutions. According to the regional central bank (BEAC), as of September 2021, the country only counted two small microfinance institutions (MFIs) as noted above, namely Bonafide and Atom Finance. Both microfinance institutions fall under the category 239 of the regional MFI categorization of the Regional Banking Commission (COBAC).40 Overall, these microfinance institutions have a limited geographic coverage at the national level. Atom Finance has opened six offices throughout the country while Bonafide has only one office in Malabo. Société Générale, press release: ‘Société Générale announces agreements for the sale of its subsidiaries in Congo, Equa- 36   torial Guinea, Mauritania and Chad and the launch of a strategic review of its subsidiary in Tunisia,’ June 8, 2023. BEAC, Annual Report 2021. 37   Source: COBAC data. 38   According to the regional Regulatory framework microfinance institutions fall into 3 different categories. Each catego- 39   ry has distinct capital requirements and activities authorized. Microfinance institutions under the first category have no minimum capital requirements while microfinance institutions under the second and third categories must comply with the capital requirement of CFAF 300 million (US$493,346) and CFAF 150 million (US$246,673) respectively. Regulation No. 01/02/CEMAC/UMAC/COBAC of April 13, 2002, and amendments thereto. 40   96 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Policy and Regulation: Overall Equatorial Guinea is part of the Central African Economic and Monetary Community (CE- MAC) and shares a common Central Bank (BEAC) and Banking Commission (COBAC) with the five other countries in the Community. The statutes of BEAC and COBAC do not explicitly mention a financial inclusion mandate. However, in practice, the BEAC develops actions to strengthen stability and financial inclusion while the COBAC has administrative, regulatory, control and sanction powers. Each CEMAC country has a National Economic and Financial Committee. Created in 2019, these committees have been given authority over consumer protection, as well as in financial education41. The Interbank Electronic Banking Group of Central Africa (GIMAC) is the only regional institution with an official mandate in terms of financial inclusion. Equatorial Guinea has not adopted a national financial inclusion strategy but is participating in the process of designing a regional financial inclusion strategy. Equatorial Guinea is one of the few CEMAC countries that does not have a national financial inclusion strategy. The regional level strategy aims to harmonize regional policy efforts to develop the financial sector and to create an enabling environment to accelerate financial inclusion. The design of the strategy began in 2020, with a diagnostic phase of the current status of financial inclusion in the region. Subsequently, four strategic pillars were identified: (i) Financial Education and Consumer Protection; (ii) Innovation, Digital Financial Services and interop- erability; (iii) Appropriate legal and regulatory framework; and (iv) adequate, accessible, and affordable supply. In addition, four cross-cutting pillars were defined: (i) Infrastructure and security; (ii) Access to identification; (iii) Data on financial inclusion; and (iv) Capacity of actors. (World Bank, 2022). At the national level, financial sector authorities have collabo- rated with the World Bank to develop a financial inclusion diagnostic including a strategic reform roadmap. This diagnostic constitutes a major step in deepening the understanding of financial inclusion issues in the country and defining a vision of the required actions to address them (World Bank, 2022). Regulation No. 03/2019/CEMAC/UMAC/CM of December 12, 2019, on the creation, organization, and operation of 41   CNEFs. 97 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Figure 13 Pillars of the CEMAC Regional financial inclusion strategy Enable access and use of an offer of VISION nancial products and services suited, diverse and affordable for vulnerable population groups (or nancially excluded) in CEMAC, to reach 50% of nancial inclusion by 2025 and 70% by 2030 TARGETS Rural Women Youth MSMEs FSPs dwellers FINANCIAL STRATEGIC EDUCATION AND INNOVATION, ENABLING LEGAL SUITED, RELIABLE PILLAR FINANCIAL DFS AND AND REGULATORY AND AFFORDABLE CONSUMER INTEROPERABILITY FRAMEWORK OFFER PROTECTION INFRASTRUCTURE (electricity, mobile, internet) AND SECURITY (Pre-requisites) FOUNDATION ACCES TO IDENTIFICATION FOR THE POPULATION FINANCIAL INCLUSION DATA Donors (Findex/Finscope), rationalization and harmonization of data collection STAKEHOLDER CAPACITY BUILDING (including regulators) Equatorial Guinea has not adopted a financial sector development strategy and its national development plan does not include a financial inclusion component. Equatorial Guinea lacks a strategic vision for financial sector development. Efforts to create a regional financial inclusion strategy are linked to the need to translate the regional strategy to the national level and to anchor these efforts through a national strategy document. However, financial sector authorities at the national level in Equatorial Guinea do not have an official plan underway to adapt the regional strategy to the national context. Furthermore, there are few government programs or national initiatives aimed at increasing the level of financial inclusion in the country. Again, the main efforts to initiate programs or reforms to create an enabling environment for greater financial inclusion come only from the regional level. As described in box 2, the Digital Agenda for Equatorial Guinea (Agenda Digital de Guinea Ecuatorial, ADIGE) is the main national plan for the digital transformation of the economy the uptake of the Digital Economy in the country (Periodico Digital Ahora EG, 2022). The strategy’s roadmap lists several critical activities for the expansion of DFS in the country, such as projects to increase mobile phone penetration and internet coverage as well as 98 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC capacity building activities for the general population in the areas of digitization and cyber- security. However, the agenda does not include a strategic plan related to DFS and cannot serve as a substitute in the absence of a national financial inclusion strategy. In addition, only a limited number of activities have been launched so far and progress remains to be made. (ADIGE, 2018). Policy and Regulation: Market Entry The regulatory framework allows non-bank financial institutions to issue e-money after obtaining a license as a payment service provider. In December 2018, COBAC adopted a regulation42 on payment services in CEMAC which came into force in January 2019. According to the regulation, credit institutions and microfinance institutions are the only institutions allowed to provide e-payment services along with the newly created category of payment service providers. These institutions are under the supervision of the BEAC and COBAC. In this context, the regulation opened the market to new entrants such as Fintech companies or telecom companies (under the condition that they establish a subsidiary sub- mitting a request to become a payment service provider). However, as of April 2023, not a single institution had been licensed as a payment service provider in Equatorial Guinea (and therefore not a single Fintech licensed in Equatorial Guinea). According to anecdotal information gathered during the stakeholder consultations, potential explanations for the absence of licensed e-money providers in Equatorial Guinea include the country’s strong cash culture as well as a nascentinnovation culture and low levels of financial education. The regional regulatory framework does not include simplified Customer Due Diligence procedures with a risk-based approach to comply with “know your customer” (KYC) rules. BEAC has not allowed the adoption of a regulatory framework containing different levels of due diligence to be required to open an account based on the different risk levels of the accounts. Policy and Regulation: Delivery Channel & Product Innovation A 2018 COBAC regulation43 allows two categories of agents to carry out operations on behalf and under the supervision and control of the payment service provider. The 2018 regulation refers to two categories of agents namely, distributors and sub-distributors. Regulation N°04/18/CEMAC/UMAC/COBAC relating to payment services in CEMAC. 42   Regulation N°04/18/CEMAC/UMAC/COBAC relating to payment services in CEMAC. 43   99 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC As per the regulation, only payment service providers are allowed to use a network of distributors and sub-distributors. There is no regulatory framework regarding the use of third-party agents by banks or microfinance institutions to extend their reach in a financial inclusion perspective. In practice, banks must ask for an authorization from COBAC for every agent contracted, which can be a lengthy procedure. As per anecdotal information collected during the stakeholder consultation, as of April 2023, no bank or microfinance institution in Equatorial Guinea had set up an agent network. Yet, agent networks have proven to be instrumental in expanding access to formal financial products and services in remote and underserved areas.44 There is no national regulatory framework for a fair and equitable access and use of the USSD channels in Equatorial Guinea. The USSD channel is not currently being used in Equa- torial Guinea as a means of expanding access to DFS in rural areas of the country with low connectivity. According to national stakeholders interviewed, only a few banks are currently negotiating the terms of access to the USSD channel or have already reached an agreement with a telecommunications operator. The digitalization of government payments is lagging in Equatorial Guinea and the country lacks a comprehensive strategy in this field. As described in the Digital Public Platforms chapter, most government agencies pay pensions and salaries manually. The government has not adopted a strategy or specific initiatives to deliver social protection programs to the most vulnerable part of the population through digital payments. Although there is potential to build on the lessons learnt from the cash transfer program implemented in the country in 2021 in the aftermath of the Bata explosion (see box 8), especially when if licensed mobile money product is available in the country).45 In addition, the social protection law remains under development.46 CGAP, Basic Regulatory Enablers for Digital Financial Services, May 2018. 44   Several countries in West Africa use mobile money accounts for social protection payments to beneficiaries, includ- 45   ing Côte d'Ivoire, Niger, Togo, and Liberia. The Permanent Commission for Social Policy, Gender Equality and Employment Promotion in the Senate approved in 46   early April 2023 the minutes and opinion of the Bill of the Social Protection System following from its second reading. 100 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Table 14 Operations permitted for payment service distributors and sub-distributors DISTRIBUTOR SUB-DISTRIBUTOR •  Collects information required to open an •  Permitted to make cash deposits and electronic money account. withdrawals from its own electronic money account. •  Receives the payment order, collects and transmits the documentation required for •  Makes transfers from its own account. the payment service provider to execute the operation. •  Permitted to offer a payment instrument to the owner of a bank account or payment account with which the payment instrument is associated. •  Permitted to execute payment operations associated with loans and payments made via payment cards or transfers. Source: World Bank, Diagnostic assessment, and strategic road map to improve financial inclusion in EQG, June 2022. In 2022, the Banking Commission adopted a decision related to cryptocurrencies, even though currency-related matters fall under the authority of the BEAC. In May 2022, COBAC adopted the Decision on the holding, use, exchange and conversion of cryptocurrencies or crypto assets by institutions subject to the COBAC47. The COBAC prohibits institutions under its mandate from directly or indirectly engaging in transactions related to cryptocur- rencies. The decision also prohibits them from accounting in cryptocurrencies or treating them as assets or liabilities and obliges them to implement internal control measures to detect cryptocurrency-related transactions and inform the COBAC and the BEAC (COBAC, 2022). The decision from COBAC occurred a few weeks after the government of the Central African Republic adopted a law on cryptocurrency, thereby making bitcoin a legal tender alongside the CFA franc (Presidency of the Central African Republic, 2022). However, certain provisions of this law were deemed inconsistent with the regional regulatory framework, and after several negotiations at the national and regional levels, the law is expected to be amended (IMF, 2023). Decision COBAC D-2022 -071 of May 6, 2022, relating to the holding, use, exchange and conversion of cryptocur- 47   rencies or crypto assets by institutions subject to COBAC. 101 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Policy and Regulation: Managing Risks of Digital Finance The CEMAC regional regulation48 on Financial Consumer Protection was approved in 2020 and entered into force in 2021. The purpose of the regulation is twofold: (i) to guarantee the protection of consumers of financial services and products; and, (ii) to ensure access to banking products and services. Institutions falling within the purview of this regulation notably include banks, MFIs, payment service providers, and other third parties. As per the regulation, financial consumers refer to individuals. In this context, micro and small and medium enterprises (MSMEs) do not fall within the purview of this regulation. The regional regulatory framework on financial consumer protection includes other CEMAC regulations such as the regulation49 on the Global Effective Rate, which relates to the rules for the disclosure of the interest rates and fees by financial service providers. The COBAC acts as the regulator and the supervisor on matters related to financial con- sumer protection50 at the CEMAC level. COBAC drafts and adopts regulatory texts relating to the protection of financial consumers and supervises the commercial practices of insti- tutions subject to the regulatory framework in force. COBAC also monitors the regulatory compliance of these institutions. Finally, COBAC is responsible for handling complaints and has the power to impose sanctions in the event of violations of the regulations in force. The 2020 Regional Regulation on Financial Consumer Protection includes dispositions in all key pillars of financial consumer protection except fair treatment. The Regional Regulation on Financial Consumer Protection51 includes provisions on disclosure and transparency, data protection and privacy as well as on dispute resolution mechanisms. However, it does not include a general provision on fair treatment. The National Economic and Financial Committee (Comite Nacional Economico y Financiero CNEF in Spanish) is responsible for the application of the financial consumer protection framework52 but suffers from a lack of institutional capacity to do so. The CNEF is notably Regulation N°01-20/CEMAC/UMAC/COBAC of July 3, 2020, relating to the protection of consumers of banking prod- 48   ucts and services in CEMAC. Regulation N°04/19/CEMAC/UMAC/CM relating to the Global Effective Rate, the repression of usury and the publi- 49   cation of banking conditions in the CEMAC. Regulation N°01-20/CEMAC/UMAC/COBAC of July 3, 2020, relating to the protection of consumers of banking prod- 50   ucts and services in CEMAC. Regulation N°01-20/CEMAC/UMAC/COBAC of July 3, 2020, relating to the protection of consumers of banking prod- 51   ucts and services in CEMAC. Regulation N°01-20/CEMAC/UMAC/COBAC of July 3, 2020, relating to the protection of consumers of banking prod- 52   ucts and services in CEMAC. 102 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC in charge of matters related to the evolution of the financial sector in particular regarding relationships between customers and financial service providers. According to the regula- tory framework, the CNEF is responsible for both, the processing of complaints between FSPs as well as between FSPs and consumers of financial services falls. Regarding the latter, the CNEF is currently establishing the operating arrangements for the set-up of a Finan- cial Mediator who should act as the alternative dispute resolution mechanism under the supervision of the CNEF. However, financial authorities still need to adopt the legislation creating and governing its functioning of the office of the Financial Mediator. In this context, as of 2023, there is no official public data on the number, nature and origin of claims or complaints against FSPs in Equatorial Guinea. These statistics are expected to be available in 2024. In addition, the CNEF partnered with INEGE to publish a study on the use of fi- nancial services by the end of the year and the webpage of the CNEF (also expected to be launched soon) should participate in bringing greater transparency in the sector. However, the lack of disclosure and publication of potential examinations of claims against FSPs makes it difficult to assess the current level of financial consumer protection in the country. Financial Infrastructure: Retail Payments Infrastructure All CEMAC countries (including Equatorial Guinea) form part of a regional payment sys- tem. The regional payment system falls within the purview of the regional central bank, BEAC, which regulates all aspects related to the regional payment system and also has supervisory powers. At the CEMAC level, the payment system infrastructure is composed of (BEAC, 2021): •  SYGMA - the Automated Large Amount System (Système de Gros Montants Automatisé - SYGMA): The regional real time gross settlement system (RTGS) for the settlement of large amounts of money; •  SYSTAC - the retail payments system (Système de Télécompensation en Afrique Centrale - SYSTAC): the Automated Clearing House of the CEMAC; •  GIMACPay – the interoperability platform operated by GIMAC (the Interbank Electronic Banking Group of Central Africa); and •  CIP - the payment incident center (Centrale des Incidents de Paiement - CIP): a risk-pre- vention and management system to collect data on incidents to prevent several types of incidents such as frauds and nonpayment of checks and other instruments. At the CEMAC level, the interoperability of payments through GIMAC cards has been ef- fective since 2015 and GIMAC cards are offered by the five Equatoguinean banks. The 103 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC objective of the GIMAC platform is to enable the interoperability of all digital means of payments. The first phase enabled interoperability between GIMAC cards. Then, in 2018, an instruction53 was adopted by BEAC to define the scope of the interoperability of e-pay- ment systems in the CEMAC. The instruction facilitated the launch of the second phase, which focused on the interoperability between e-money and transfers (including real-time between e-money and bank accounts). As per anecdotal information gathered during the stakeholder consultations, as of April 2023, only banks in Equatorial Guinea were connected to the regional platform. Microfinance institutions are currently finalizing the process to be connected to the platform while the interconnection of public treasuries is still at the conceptual stage. Financial Infrastructure: Credit Infrastructure Equatorial Guinea does not have a national credit bureau; however, a payment incidents center exists at the regional level. Equatorial Guinea does not currently have a national credit bureau or a register of collateral guarantees. The National Economic and Financial Committee (CNEF) is currently working on the creation of a register of collateral guarantees while the regional central bank is responsible for the management of the regional credit bureau. So far, the regional credit bureau has only been accessible to banks in the CEMAC, and several banks have reported flaws in the use of the regional credit bureau to the BEAC. Summary of Constraints to DFS Development A combination of interrelated factors hinders the development of DFS in Equatorial Guinea. The lack of systematic data on the demand-side (from the perspective of DFS users) makes it difficult to provide a comprehensive assessment with a hierarchy of barriers to broader access to DFS in the country. Based on a qualitative assessment using available DFS-related statistics and the findings from the stakeholder consultation, key constraints to DFS devel- opment in Equatorial Guinea range from the lack of access to key digital infrastructure (and related connectivity issues) as well as the absence of government prioritization of public policies to support digital financial inclusion. However, market barriers such as the lack of competition in the financial sector, the restructuring needs of the banking sector and the limited innovation culture remain the most critical barriers to the development of DFS in Instruction No. 001/GR/2018 relating to the definition of the scope of interoperability and inter-banking of elec- 53   tronic payment systems in CEMAC. 104 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC the country. These market-related constraints contributed to the late focus of FSPs on the digital transformation of financial industry in Equatorial Guinea The focus of traditional banks in Equatorial Guinea on addressing risks to financial stability delayed their digital transformation efforts (including DFS development and commercial- ization). Most banks operating in Equatorial Guinea continue to face operational as well as profitability issues and decided to focus their resources on the management of the economic fallout of the pandemic. The restructuring and recapitalization needs of the Equatoguinean banking sector prevent banks from fully tapping into digital opportunities. Yet, scaling up technology-enabled solutions could help them accelerate the path to recovery. FSPs operating in Equatorial Guinea were late adopters of digital trends and continue to lag behind in building a culture of innovation. FSPs started fairly recently to invest in in- novation capabilities to develop new financial products and services leveraging on digital technologies. Several banks operating in Equatorial Guinea are subsidiaries or branches of international banks. In this context, strategic decisions related to the digital transformation of products, services and processes are often made at the group level. These banks there- fore started their digital transformation journey in other countries (with larger markets), and later applied lessons learned in the process to accelerate the digital transformation of their subsidiary or bank branch in Equatorial Guinea. However, traditional banks in Equa- torial Guinea are also facing their own difficulties in the implementation of their digital strategy, hence the slow pace of digital transformation and the limited availability of DFS. In the same vein, telecom operators active in Equatorial Guinea lag regional peers in terms of innovation capabilities which partly explains why only one among the three telecom operators is actively seeking to launch a mobile money product in the short-term. Yet, in- novation capabilities are critical to develop financial products and services tailored to the needs of the financially excluded or underserved segments of the population. The nascent stage of digital maturity of the financial ecosystem in Equatorial Guinea cou- pled with a difficult environment for entrepreneurial ventures are key impediments to the development of fintech companies and financial innovation in the country. There is no fintech company officially licensed from Equatorial Guinea, and financial institutions operating in the country only collaborate with a limited number of international fintech companies (when there is a clear perceived business opportunity to improve operational efficiency) particularly as part of their digital transformation journey. However, at the global level fintech companies have proven their ability to support the financial inclusion objectives, by notably making financial products and services more convenient, available, affordable, and tailored to the needs of low-income population groups. 105 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC The low level of access to digital infrastructure as well as connectivity issues in certain parts of the country, remain key constraints to the development of DFS in Equatorial Guin- ea. The Digital Infrastructure pillar of the present report provides a detailed overview of the barriers to connectivity in Equatorial Guinea. From a digital finance perspective, the low number of mobile cellular subscriptions in Equatorial Guinea along with the increasing, but still low, percentage of the population using the Internet remain the most significant barri- ers to financial inclusion for a larger share of the population. In this context, a significant part of the population in Equatorial Guinea still does not have access to the basic digital infrastructure required use DFS. Equatorial Guinea does not have a national financial inclusion strategy. Even though the national stakeholders participated in the development of the regional financial inclusion strategy, the absence of a national strategy reflects the low political prioritization of fi- nancial inclusion as part of the government’s national development plan. Yet, access to formal financial services, especially DFS, makes it easier, safer, and often more affordable for low-income populations to save, to borrow, to send or receive money, to pay remotely or to start a business. In this context, regional financial sector authorities are redoubling their efforts to harmonize policies in order to design a robust strategy to improve financial inclusion at the CEMAC level. Equatoguinean policymakers should leverage on this momen- tum to develop their own coordinated strategy and action plan to accelerate the level of financial inclusion at the national level, instead of relying on the regional strategy, which is less tailored to the country’s specificities. In the absence of a national financial education strategy, the availability of financial edu- cation programs and initiatives remains limited and insufficient to address the low level of financial literacy of the population. Given the growing complexity of financial products, financial education programs are critical to equipping the population with the financial knowledge and information to make appropriate financial decisions. The lack of survey data or diagnostics on the state of financial literacy in the country hampers the ability to assess financial education needs as well as to clearly identify key target groups and adequate financial education delivery channels. As a result, a sizable portion of the pop- ulation continue to demonstrate a low level of financial literacy and remain unaware of the opportunities offered by DFS, which acts as one of the most important barriers to the progression of financial inclusion and to the development of DFS in the country. In addition, most of the financial service providers interviewed do not consider themselves responsible for designing and implementing financial education initiatives and have mostly launched social marketing initiatives to educate existing and prospective customers on how to use their financial products and services. 106 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC The shortcomings in administrative and operational capacity of the National Economic and Financial Committee (CNEF) are a critical constraint to the application of financial consumer protection policies and regulations. According to the regulatory framework for financial consumer protection, the examination and collection of data on the number, nature and origin of claims or complaints against FSPs falls within the purview of the Financial Mediator (under the supervision of the CNEF). Yet, the low degree of application of the regulatory framework (including the delays in the operationalization of the role of the Financial Mediator) is detrimental to its intended objective of addressing the population’s widespread mistrust of formal financial service providers and better protecting financial consumers from risks such as frauds, scams and breaches of contracts. For instance, in 2021, the National Bank of Equatorial Guinea (BANGE) reported a total of 1,885 complaints, mostly related to delays in the delivery or activation of cards, ATM breakdowns, delays in the return of funds, or overcharges.54 As described in the Digital Infrastructure Pillar, Equatorial Guinea does not currently have a regulatory framework on cybersecurity, which undermines the protection of DFS con- sumers. The absence of a national cybersecurity regulatory framework leaves DFS users vulnerable to cybersecurity risks such as fraudulent transfers, credential theft, or disrup- tions to payment systems. The increasing reliance on digital infrastructure, coupled with the lack of a clear governance framework that identifies responsible parties in the event of a cyber-attack, undermines trust in formal financial services and the willingness to use DFS. In addition, the limited capacity of law enforcement authorities to properly detect, inves- tigate and prosecute cybercrimes fosters a climate of suspicion and fear among potential users of DFS. From an industry perspective, the lack of collaboration on fraud prevention and incident reporting among FSPs and other DFS stakeholders ultimately comes at the expense of the collective security and cyberthreat resiliency. The collection and analysis of data in general and sex-disaggregated data in particular is not a widespread practice among FSPs in Equatorial Guinea. Due to technical, financial, and operational constraints, FSPs in Equatorial Guinea face challenges in collecting and analyzing data to facilitate operational decision-making or for marketing and product de- velopment purposes. FSPs focus most of their data collection efforts on meeting reporting requirements or internal monitoring. From a gender perspective, the lack of a national or regional strategy or mandate for the collection and analysis of sex-disaggregated data partly explains the low level of awareness of women’s specific financial needs and the rel- atively low supply of women-oriented financial products and services. In this context, the Banco Nacional de Guinea Ecuatorial, Informe de Gestión 2021 54   107 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC development of an updated national diagnostic of social and/or cultural norms that may act as barriers to women’s (digital) financial inclusion would also help to better identify and address the root causes of women’s financial exclusion. Difficulties faced by FSPs in accessing USSD channels hinder the availability of DFS in re- mote areas. Access to DFS in Equatorial Guinea remains mostly limited to urban areas. A few FSPs in Equatorial Guinea have developed plans to expand their customer reach to rural areas, particularly though the use of the USSD channel. However, they raised concerns about reported unfair treatment in negotiations with telecom operators regarding the conditions and the rate structure for access to USSD channels. In the absence of regulations, rates, and conditions for access to USSD channels have to be decided on a case-by-case basis. However, the telecom regulator did not report any concrete plans to draft a regulation for fair and equitable access to the USSD channel. 108 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC 3.3 | DFS RECOMENDATIONS DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION POLICY AND REGULATION: OVERALL Develop a national financial inclusion strategy: Design, finalize, and adopt a national financial inclusion strategy with a focus on the development of DFS (in line with the regional financial inclusion strategy and the national diagnostic on financial inclusion). The national financial inclusion strategy should also include the following components: •  A comprehensive national survey of demand for financial services to better assess financial inclusion challenges and to guide the development of relevant policy responses to tackle identified barriers and gaps. •  A national financial education strategy (in line with BEAC’s financial education-related projects) to enhance the financial capability and resilience as well Medium- as financial health of vulnerable groups in Equatorial Inclusion Policy Reform term Guinea. •  A data collection strategy on key financial inclusion- related metrics, including the collection of data on the geographic location of the different access points. •  A strategy for the collection and analysis of sex- disaggregated data on relevant financial inclusion related metrics, and the inclusion of sex-disaggregated data collection in the reporting requirements of financial institutions. •  A roadmap for the digitalization of persons to government (P2G) and government to persons (G2P) payments (such as civil servant salaries and social protection programs) to encourage wider adoption of DFS. MARKET DEVELOPMENT Improve key DFS enablers from a market perspective and foster industry collaboration (e.g,. by strengthening/establishing e-commerce platforms, Investment/ cybersecurity platforms, crowdfunding platforms, etc.) Growth Long-Term Policy Reform and by developing an enabling environment for fintech development at national level including a fintech innovation hub. 109 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION POLICY AND REGULATION: DELIVERY CHANNEL & PRODUCT INNOVATION Assess the need to expand and strengthen agent Equity/ networks to foster DFS adoption, especially in remote Investment Quick win Inclusion areas. POLICY AND REGULATION: MANAGING RISKS OF DIGITAL FINANCE Design and implement capacity building programs and activities: For the CNEF of Equatorial Guinea, to build capacity in its newly acquired responsibilities for the protection of financial consumers (i.e., in the areas of mediation and the design of a data infrastructure to support the Equity/ Medium- Investment processing, monitoring and analysis of cases). Inclusion term For financial Service Providers, to build the capacity in the management of internal dispute resolution mechanisms as well as in the collection and use of data to develop DFS suited to the needs of vulnerable groups. 110 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC @ Krakenimages / Shutterstock 111 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC 4 | DIGITAL BUSINESSES 4.1 | IMPORTANCE Digital businesses55are playing a transformative role in reshaping African economies, presenting unparalleled business opportunities for entrepreneurs and benefits for individ- uals, enterprises, and governments.56 Those that have embraced digital technology exhibit higher levels of resilience, adaptability, and performance, and are associated with higher productivity and job creation (Cirera, 2022). ICTs are a key catalyst for increasing produc- tivity and supporting business growth. The use of technological tools optimizes internal processes, streamlines communication, and enhances strategic decision-making. Moreover, they enable task automation, facilitate real-time access to information, and provide in- depth data analysis. This enhanced technological infrastructure empowers businesses to withstand disruptions, innovate rapidly, and seize new opportunities, driving their success and sustainability in a dynamic and evolving business landscape. Even the adoption of basic digital technologies such as payments, accounting or inventory management is associated with higher labor productivity and jobs, including for microenterprises (Begazo, Dutz, & Blimpo, 2023). Digital technologies are a key tool to transform Equatorial Guinea’s economy, reduce its dependence on oil, and achieve inclusive growth.57 As described in box 1, the recent Na- tional Sustainable Development Strategy (Agenda 2035) is supported by four strategic pillars.58 Among them, the development of the private sector stands out: creating a more competitive environment through cross-cutting policies, implementing incentive systems The World Bank refers to two categories of digital businesses: 1) digital start-ups such as early-stage ventures that 55   create new digital solutions or business models as part of their core products or services. and 2) established digital businesses which are mainly large platform-based and data-driven firms that have passed the initial start-up stage, Digital Business: Digital solution providers that develop and manufacture digital technology products or digital 56   services; a subset of these use platform based and/or data-intensive business models. World Bank. 2023 A Spiky Digital Business Landscape. Link Equatorial Guinea’s economy is heavily reliant on the hydrocarbon sector, accounting for 60% of its GDP and 80% 57   of state revenue. This reliance causes significant economic instability, as the country suffers during periods of de- clining hydrocarbon prices, The four strategic axes are poverty eradication, social inclusion and sustainable peace, productivity, and industrial- 58   ization, and finally, environmental sustainability and territorial development. 112 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC for companies, promoting foreign investment, strengthening social capital, and improving the necessary infrastructure for business activity, with an special focus on fostering growth in sectors such as agriculture, forestry, fishing, tourism, and other industries to create a sustainable economy. 4.2 | DIAGNOSTIC FINDINGS: CURRENT STATE OF DIGITAL BUSINESSES This chapter provides a comprehensive analytical assessment of the current state of Digi- tal Business in Equatorial Guinea. First, it examines the digital business ecosystem, which encompasses the characteristics of digital businesses, the presence of incubators and ac- celerators facilitating their establishment and promotion, government’s initiatives and agencies that furnish support, and the collaborative endeavors of civil associations aimed at fostering their growth. Subsequently, the chapter delves into a detailed study of pivot- al factors, encompassing digital infrastructure, entrepreneurial culture, access to finance, prevailing policies, and regulations, as well as the market dynamics and the human capital that supports the private sector development, with a particular emphasis on digitalization. Finally, the chapter identifies the main barriers encountered based on the assessment conducted and provides a range of targeted recommendations tailored to address these challenges effectively. A thriving digital business ecosystem, leading to productive use and more and higher-qual- ity jobs, necessitates a combination of various interdependent factors that are constrained in Equatorial Guinea. As described in this chapter, creating, sustaining, and growing a digital business involves several factors. To assess the country’s digital business ecosystem, the chapter first maps the institutions providing support, guidance, and resources to foster entrepreneurs’ culture, including networking, events, mentoring and knowledge exchange programs. Secondly, the chapter focuses on access to finance for entrepreneurs and small businesses, paramount to secure resources when there are market failures. Then, the chap- ter describes the enabling regulatory environment in place to promote the establishment and survival of digital businesses, addressing specific issues such as cybersecurity, data protection and intellectual property. Through interviews with the main ecosystem players, many pertinent issues have come to the forefront. As described in detail in the following sections, among these concerns is the dearth of legislation that actively promotes the expansion and development of digital startups. Interviewed businesses have expressed the significant challenges they encounter in accessing private financing programs due to rigorous eligibility criteria. Additionally, 113 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC these entities grapple with the predicament of sourcing proficient human resources well versed in digital technology and finance matters. Lastly, both logistical and digital infra- structure suffer from deficiencies attributable to exorbitant costs and restricted access for the population, thus restricting demand for digital services. Table 15 Indicators for Digital Business including structural and aspirational peers59 STRUCTURAL PEERS ASPIRATIONAL PEERS CAR (Central African Timor-Leste Congo Rep. Azerbaijan Costa Rica Cameroon Singapore Mauritius Republic) Gabon Qatar EQG UAE INDICATOR NUMBER OF DIGITAL BUSINESS 3 1 13 5 201 3 169 4402 442 8194 228 295 MEDIAN AGE OF DIGITAL BUSINESS 12 1 5 9 5 5 7 8 13 7 9 9 (Sample size for 3 1 9 2 180 2 160 3970 400 7124 199 259 median age) TOTAL FUNDING (in million USD) N/A 38 N/A 4 9 N/A 1260 18106 733 40450 4238 1658 (Sample size for total N/A 1 N/A 2 15 N/A 35 633 48 2034 33 41 funding) NUMBER OF DIGITAL BUSINESSES PER SECTOR FinTech 1 N/A 3 1 42 N/A 28 615 42 1418 54 29 E-Commerce 1 N/A N/A N/A 24 N/A 23 639 34 1071 30 44 Source: World Bank (2022) A Spiky Digital Business Landscape: What Can Developing Countries Do? 59  The DE4A indicators originally intended to assess the state of digital businesses in EQG have been replaced due the limited availability of country-specific data within the anticipated databases. Instead, these indicators have been developed using the available data from the WB Digital Business database. 114 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Current Digital Entrepreneurship Landscape The digital business ecosystem in Equatorial Guinea is still in its early stages of develop- ment, with a limited pipeline of domestic digital services. According to the World Bank Digital Business database, only three digital businesses have been mapped in international databases that track funding to digital business (Table 15 above).60 The DE4A mission on the ground identified additional companies in the ecosystem. They primarily offer digital services, catering for the needs of business through online platforms and applications, such as ATM Technologies, Consultoria Tecnologica GE, and Geconsul Technology.61 Additionally, there are a few businesses that operate through digital platforms, utilizing technology to connect with clients such as EGGalleria,62 HotelyPunto,63 and EmpleoGuinea,64 among others. Finally, a few businesses follow a hybrid model, combining digital and physical elements (e.g., for payments or coordination of delivery) in their operations, such as Situcka65 and Rellanos Express.66 Overall, the services offered by local digital business are limited, while global entertainment, search engines and social network platforms rank among the top internet traffic destinations in Equatorial Guinea.67 FCI Digital Business database which assesses the digital business landscape across 190 countries by consolidating 60   information gathered by Pitchbook, CB Insights and Briter Bridges databases. The database is a firm-level database of 200,000 digital businesses in 190 countries. It was created using three different proprietary data sources – CB Insights, Pitchbook, and Briter Bridges – that use various techniques, from web-scraping to gathering firm informa- tion from entrepreneurship networks, venture capital (VC), and other investment deals. They specialize in collecting information on tech start-ups or digitalized firms that would be attractive for VC/private equity (PE) investors due to certain innovative elements in their business models, or core product offerings. 61  INEGE database Eggalleria is an all-encompassing online platform that provides a diverse array of products, ranging from food 62   delivery services to a wide selection of food items and electronic devices. Link Please note that it was not possible to obtain more information, HotelyPunto is an online booking platform for hotels in the country. Link 63   EmpleoGuinea is an E-Recruitment platform developed for the online management of job posting, recruitment, and 64   personnel selection processes for companies in Equatorial Guinea. Link Situcka is an online platform that offers grocery products a Link. 65   Rellanos express is an online platform that offers delivery services in Malabo. Link 66   YouTube with 1.7 million visits, Google with 499.6k visits, Bing with 492.6k visits, See Hua with 336k visits, and 67   Facebook with 308.2k visits. Semrush, 2023. Market Overview for Equatorial Guinea 115 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Box 9 Digital business hybrid models: Rellanos Express and Situcka. Rellanos Express was launched in 2020, during the pandemic, offering food and package delivery services through a digital platform, with eight employees covering the metropolitan area of Malabo. Rellanos present a hybrid business model where customers place orders through a phone number provided on the website and make payment in cash once they receive the order at their doorstep. Situcka.com, launched in May 2020, is an online platform for selling grocery prod- ucts, created by Bike and Tech S.L., with a vision to distribute all kinds of super- market and restaurant products in Equatorial Guinea. The process begins when customers request products through the platform, and the Situcka.com team sub- sequently locates them in the establishments and delivers them to their doorstep with cash on delivery payment. The target market consists of middle to upper-class men and women between the ages of 25 and 40. Their infrastructure includes: (i) An operational base in Elá Nguema, from where they manage all orders; (ii) 5 ad- ministrators responsible for IT, sales, marketing, and maintenance; (ii) 5 drivers on electric bicycles, directed from the base. Their annual turnover exceeds 10 million and is growing at a rate of 200 percent per year. The growth in the number of orders is approximately 390 percent per year. Although initiatives to support digital entrepreneurs are in place, digital businesses face difficulties to develop their operations in Equatorial Guinea. Digital companies and entre- preneurs interviewed highlighted numerous barriers throughout the process of launching their businesses and implementing expansion strategies. These barriers include limited internet access, insufficient technological and logistical infrastructure, lack of finance, dif- ficulties in establishing secure online payment systems, finding qualified local staff, cy- bersecurity issues, and the absence of tailored regulations (see Box 9)To overcome them, digital startups have emerged with a hybrid business model that allows them to leverage the advantages provided by digital platforms and e-commerce-driven product delivery, aligning with the changing demands of customers. However, they still encounter various obstacles in establishing and expanding their business model, as they struggle with a com- plex business environment, lack of finance, and technical difficulties such as developing mobile applications to enhance their online presence, establishing a secure digital payment system, and efficiency managing the logistical distribution of their products. 116 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Adoption of digital technologies by firms is also lagging creating opportunities for digital businesses that cater to domestic demand, although government interventions might be needed to boost digital trust and adoption. In 2018, only 28 percent of companies had their own website, a rate lower than Africa as a whole (33 percent) and the average for Central Africa (31 percent). The low adoption of innovative technology by local businesses explains, in part, the limited development of e-commerce and online service platforms in the coun- try. In addition, Equatorial Guinea ranks 168 out of 175 countries in digital security.68,69 Inadequate digital security can deter both domestic and foreign investment, particularly in sectors that are heavily reliant on digital technologies.70 Digital businesses in Equatorial Guinea rely on various key factors that must be present in the ecosystem, both from the public and private sectors (Figure 14). These include: favorable regulatory framework and supportive government policies; (i)  the increased availability of financing and venture capital; (ii)  sizable market underpinned by ability to pay and willingness to use digital technol- (iii)  ogies by individuals, enterprises, and government; the development of digital skills within the workforce; (iv)  the enhancement of digital infrastructure, encompassing broader internet access and (v)  faster connectivity, and support services; and, entrepreneurial talent and innovation culture. (vi)  Digital security can impact investments in underdeveloped countries. It increases the risk of cyber-attacks, intel- 68   lectual property theft, and privacy breaches. The lack of robust infrastructure and adequate regulations can deter investors and raise security costs, which makes risk management a challenging process and undermines investor confidence in these investments. ITU 2018. Global Cybersecurity Index. Link 69   AUC/OECD. 2021. Digital transformation for youth employment and Agenda 2063 in Central Africa, Chapter 4 in 70   Africa’s Development Dynamics 2021: Digital Transformation for Quality Jobs. 117 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Figure 14 Drivers for digital businesses. • R&D environment & • Availability and pricing of institutions digital devices and platforms • Venture-friendly • Availability and pricing of legislation and processes Internet access • Taxation • Digital commerce channels • Foreign business and value chains friendliness • Financial inclusion levels • Digital industry support and incentives • Entrepreneurship strategy and regulatory framework incentives (e.g. tax • Availability of software bene ts) Policy developers • Skill-levels of developers Financial • Managerial and Markets Capital • Angel investors organizational skill levels • Venture capital / private equity • Creative skills • Debt nance • General availability of skilled labor • Capital markets • Foreign Human investment Capital Culture Infrastructure • Internet speed & Supports • Energy • Transportation & logistics • Business activity (esp. • Tech hubs, co-working in creative sectors) places, incubators, and accelerators • Attitudes toward entrepreneurship • Professional (social) networks • Risk tolerance • Entrepreneur-friendly • Con dence associations • Social media attention • Events and conferences • Role models Source: Babson Entrepreneurship Ecosystem. 118 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Infrastructure and Supports: Incubators, Accelerators and Civil Associations A nascent ecosystem of incubators, accelerators and civil associations is supporting the creation of digital businesses in Equatorial Guinea. DREAMS HUB Research and Innovation Center and IDENTIC are two prominent players in this ecosystem, both part of the AfriLabs Network,71 the largest network of technology and innovation centers in Africa, boasting a strong presence in 52 countries across the continent.72 The IDENTIC Foundation provides support to entrepreneurs since 2018. Its support includes (i) capacity building (digital competencies, professional training for employment and entrepreneurship, TIC program for women); (ii) digital inclusion (social projects aimed at reducing the digital divide, particularly for communities at risk of digital exclusion); (iii) communications (promoting digital creative and cultural audiovisual content); (iv) digital entrepreneurship (incubation and accelera- tion programs). IDENTIC also aims to establish an investment fund or startup financing in collaboration with financial institutions and set up entrepreneurship laboratories. Dreams Hub is another technology research and investigation center helping the development of digital entrepreneurship in Equatorial Guinea. Its main activities encompass (i) Dreams Hub Talk (knowledge sharing among entrepreneurs); (ii) Huevos de Cristal (training for children between 7 to 13 in innovative technologies); (iii) Autoclax (online courses on business skills, technology, marketing, and finance); and (iv) La Capsula (incubator for small businesses and young entrepreneurs and connections to networks of experienced investors and en- trepreneurs) Among the recent notable events and initiatives, TEG Campus stands out as a joint initiative by GITGE and IDENTIC. The latest edition, held in 2022 under the theme “Technology for a Sustainable Planet,” gathered renowned experts and professionals from various technolog- ical fields. The event featured conferences, workshops, and competitions focused on inno- vation, entrepreneurship, and digital skill development. TEG Campus has established itself Afrilabs is a pan-African network of technology and innovation hubs founded in 2011. It consists of over 250 71   member hubs spread across more than 45 African countries. This network’s main goal is to foster collaboration, knowledge sharing, and capacity building among its member hubs to drive innovation and entrepreneurship in Af- rica. Afrilabs serves as a platform for hubs to connect, exchange best practices, and collaborate on initiatives that support the growth of the tech ecosystem. The network also advocates for policies and programs that enhance an enabling environment for technology and innovation. It supports startups by providing resources, mentorship, and funding opportunities. Additionally, it organizes events and programs to facilitate networking, skills development, and ecosystem building within the African tech community. Link Ahora EG. 2020. De las Incubadoras y Aceleradoras tecnológicas, a los ecosistemas de innovación corporativos en 72   Guinea Ecuatorial. Link 119 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC as a highly significant sub-regional event and a leading platform for knowledge exchange and the promotion of technological talent in Equatorial Guinea. There are also professional associations that support the strengthening of the business environment for digital businesses. Among them, is EMEG (Entrepreneurs Association of Equatorial Guinea),73 whose main activities include monitoring the implementation of new projects, providing training for entrepreneurs, and organizing events to encourage col- laboration. However, its membership base remains small with only seventeen companies listed as members. Noteworthy initiatives include courses for the digitalization of SME management. Infrastructure and Supports: Infrastructure and Logistics Infrastructure and logistics deficiencies pose significant challenges to the operation of digi- tal businesses. While expanding the fiber optic network, the coverage of high-speed mobile internet and the quality of international data connectivity is important,74 addressing the frequent power outages is key as well. Furthermore, for e-commerce, poor transportation infrastructure along with a lack of formal addresses hampers the sector too. EMEG is an association promoting and supporting entrepreneurs in Equatorial Guinea. Link 73   Refer to Chapter on issues related to digital infrastructure. 74   120 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Box 10 TEG Campus Malabo 2022, TEG Planet Edition The TEG Campus is the first technological event in Equatorial Guinea and emerged within the framework of GITGE’s Corporate Social Responsibility activities. It is the largest youth tech event in Central Africa aiming to promote awareness, connecting entrepreneurs, innovators, developers in order to create a professional network all around the African ICT sector. The TEG Campus is reaping its first fruits in the de- velopment of the technological innovation ecosystem that has been created since the first edition of the TEG Campus in Malabo in 2018. In 2022, the in-person 5th edition of TEG Campus, TEG Planet 2022 took place from the 16th to 21st of December in the Malabo National Park, with the slogan “Technology for a sustainable planet.” Thus, the focus of inventions and techno- logical projects was to find solutions and mechanisms for the sustainability of the planet and reduce the impact of climate change. TEG Planet included a session on good practices for energy saving, a bootcamp, a workshop for digital drawing and a Labzone for the preparation of projects. On November 18, 2022, sixteen young Equatoguineans who were shortlisted for the Teg Campus Labzone traveled to India to participate in the UNESCO India-Africa hackathon technological event. The efforts for investing in the creation and develop- ment of a technological innovation ecosystem in Equatorial Guinea were recognized, creating technological events such as the TEG Campus, social events such as GITGE Educa, and being GITGE a pioneer in the creation of the Center for Technological Innovation (IDENTIC), the first technological foundation at the national level. The event is not limited to the development of technology through training and competitions of talented young people, but also aims to create an experience for all those who participate in the event. For this reason, during the five days of ac- tivity, workshops, panels, talks, ideas contests, entrepreneurship training, video game contests and a space for entertainment were offered. The TEG Campus also has the mission of educating all audiences about ICT knowledge and the benefits of digitalization, which play a transversal role in all sectors of society. The next edition of TEG Campus was postponed to 2024. Instead, an international Hackathon was scheduled to take place in Malabo at the end of 2023. Its main ob- jective was to promote the development of innovative and disruptive technological solutions to address a range of social problems. Source: TEG Campus 2022 https://tegcampus.com/. 121 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Culture The significant presence of the government in the economy and perceptions of weak gov- ernance suppress the entrepreneurial environment. The support for ensuring free markets and entrepreneurship in Equatorial Guinea is weak. The country scores 2.8 out of 10 in the Bertelsmann Transformation Index’s market economy component.75 In this context, entre- preneurship might not be seen as a viable and successful professional alternative. In Equatorial Guinea, efforts have been made to promote gender equality and women’s rights. The legal and institutional framework has been updated, with the enactment of important laws such as the Fundamental Law, General Labor Law, and General Education Law. Financial support has been provided to associations and women’s groups through programs like AIMUGE, spearheaded by the First Lady. The Ministry of Social Affairs and Gender Equality (MINASIG) has also established and implemented the Global Framework Strengthening Project, offering support to various women’s groups in areas such as man- agement, legalization, and marketing techniques for their products. However, challenges persist in terms of educational opportunities, with a low enrollment rate for both boys and girls in primary school, standing at 51 percent for boys and 49 percent for girls in 2017. Women’s participation in the labor force remains limited, with only 39 percent employed in formal and informal sectors compared to 61 percent of men. Geographical disparities exist as well, with higher rates of formal and informal employment for women in the island region of Malabo (26.8 and 19 percent, respectively) compared to the mainland (18.9 and 16.5 percent, respectively). Financial Capital: Access to Finance Access to finance poses a significant challenge for digital entrepreneurs in Equatorial Guin- ea. Access to finance is identified as one of the key constraints for private sector develop- ment in CEMAC, it remains low as a credit to the private sector for all member countries remains below 15 percent of GDP and below 12 percent in Equatorial Guinea. Low access to finance is the result of weak credit infrastructure and a poor enforcement environment. Informality, size and lack of sophistication and collateral exacerbate the challenges of SME access to finance. Venture capital and private equity (VC/PE) are nascent in the CEMAC region and non-existent in Equatorial Guinea. Only 17 companies have been identified throughout the region engaged in this type of activity and not even one has a presence in For more details visit: https://atlas.bti-project.org/1*2022*CV:CTC:SELGNQ*CAT*GNQ*REG:TAB 75   122 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Equatorial Guinea. The low penetration of VC/PE is the result of the weak business envi- ronment and absence of a dedicated legal framework in the CEMAC region. Despite the government launching financing initiatives such as the INPYDE (National Institute of Promotion and Development) investment fund, entrepreneurs have limited knowledge and utilization of these opportunities. The investment fund of the INPYDE of Equatorial Guinea, created in 2013 with 425 million XAF, has only granted thirty-four loans since the investment fund was established. This issue stems from a combination of factors, including (i) a lack of awareness among entrepreneurs about the existence of the investment fund hampers their access to it (ii) the intricate procedures required for credit application and disbursement pose significant challenges. and (iii) the presence of limited resources further compounds the difficulties faced by these entrepreneurs. Table 16 Programs to facilitate access to finance ENTITY INITIATIVE DESCRIPTION Bange Impulsa is an accelerator program launched in 2021. 76 The first edition received 600 ideas. Out of those, 35 were selected and had the opportunity to participate in a three-month BANGE course on business planning and management. The top 15 advanced to a final phase, where the 10 winners (including 3 women-led companies) received a prize of 25 million XAF, with a 12-month grace period and an 8 percent interest rate. The Guarantee Fund for SMEs initiative, managed by INPYDE in collaboration with BANGE, is INPYDE based on a guarantee fund endowed with 351M XAF, with a repayment period of 5 years. 77 AIMUGE is endowed with 6,800M XAF in collaboration with BDEAC and provides loans AIMUGE targeted at women for a period of 2 to 5 years, including initiatives related to information and communication technologies. 78 Bange Impulsa is a program funded with 250 million francs by BANGE in loans to finance winning projects, aiming to 76   promote entrepreneurship and self-employment development in order to generate stable businesses and diversify the country’s economy. La segunda edición de Bange Impulsa ya tiene ganadores, Ahora EG (Mar 6th, 2023). Link Ahora EG. 2021. INPYDE anuncia los requisitos para la concesión de créditos a las pequeñas y medianas empresas. 77   Link 78   Ahora EG. 2022. AIMUGE: miles de mujeres tienen la oportunidad de materializar sus iniciativas de emprendimiento” Link 123 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Policy and Enabling Regulations Equatorial Guinea has embarked on a series of initiatives to improve the business climate which in turn can contribute to the increase of digital businesses operating in the country. In 2019, a plan was introduced to enhance the business environment through the establishment of an inter-ministerial national technical committee tasked with driving the development, implementation, and monitoring of the national development plan. These reforms emphasize streamlining processes and increasing information transparency. Notable activities include the establishment of one-stop shops for business creation in Bata and Malabo, the launch of an investor-focused webpage79 by the Ministry of Finance providing key information for investing in Equatorial Guinea, and the establishment of Holdings Equatorial Guinea to promote diversification efforts.80 The implementation of the Single Business Window (Ventanilla Unica Empresarial in Spanish) by the Ministry of SME in 2017 has yielded significant improvements in the efficiency of the business registration and formalization process. By reducing bureaucratic hurdles and streamlining procedures, the average registration time has been drastically reduced from 33 days to just 5 days. This has had a positive impact on the ease of registering new businesses. However, there is still room for improvement, such as enhancing coordination between the two locations, Bata, and Malabo, and establishing transparent fees for the services they provide. The new World Bank Business Ready reports will provide additional insights on the nature and impact of the constraints faced by business including digital business. The country specific reports will also provide a greater understanding of the regulations and institutions that support private sector development in the country, including services like the Single Business Window mentioned above.81 It is important to note that the informal sector still represents a substantial portion of the Guianese economy and remains outside the scope of the Ministry of SMS Promotion’s current initiatives. In addition, the country has enacted a law that comprehensively regulates mediation as an alternative dispute resolution mechanism, thereby enhancing the effectiveness and enforcement of contracts and simplifying the resolution of disputes for companies, but it needs to be implemented Ecuatorial Guinea 360. First online business directory in Equatorial Guinea. Link 79   World Bank. forthcoming. Country Economic Memorandum, Equatorial Guinea 80   The new World Bank project, “Business Ready (B-Ready),” will globally assess economies, including Equatorial 81   Guinea, focusing on regulatory frameworks, public services for businesses, and the practical combination of these elements. B-Ready addresses ten key areas spanning a business’s lifecycle, including entry, location, utilities, labor, finance, international trade, taxation, dispute resolution, competition, and insolvency. Initial results for the Equa- toguinean economy are expected by 2025. Link 124 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC and enforced. Additionally, Equatorial Guinea is currently in the process of drafting a new trade law to further enhance its legal framework, and there is a public proposal for enacting the first startups regulation. The government has taken measures to attract foreign investment, but with limited results. Through the modification and updating of the previous investment law, the conditions for foreign investment have been enhanced.82 Among the notable measures is the elimination of the requirement to have a local partner to conduct business in the country in the non-oil sector. This is highly positive as it facilitates investment more flexibly and autonomously for external investors. In addition, there are exemptions from fees and reduced rates for the acquisition of ICT equipment, contributing to the ease of doing digital business. Equatorial Guinea has made significant efforts to establish a legal framework to facilitate business development and is actively working on enhancing its regulatory framework. The existing laws encompass essential areas such as telecommunications, personal data protection, intellectual property rights, and electronic communications. Furthermore, there are ongoing efforts to develop additional legislative proposals, including statutes governing digital commerce and cybersecurity. Despite the positive progress made thus far, further efforts are necessary to establish a robust and comprehensive regulatory framework to ensure alignment with prevailing international and regional frameworks, such as CEMAC, OHADA83 and African Union, with emphasis on digital commerce. Additionally, the establishment of effective implementation mechanisms and the designation of appropriate governmental agencies entrusted with the responsibility of enforcement are crucial. The absence of a publicly accessible database of current legislation, proposed bills and implementing regulations creates uncertainty for private sector actors and investors. The current state of the Official Gazette (Boletin Oficial del Estado in Spanish) is disorganized, with broken links and outdated information. Equatorial Guinea does not currently offer official translations and validations of key legislation, such as OHADA laws and the new Customs Code which in turn increases legal uncertainty, as well as Spanish translation of all OHADA laws. This lack of reliable access to legal documents undermines transparency and results in potential errors in the interpretation of the laws. Furthermore, the current legislative process lacks effective public consultation of bills, which hinders transparency and the proper consideration of issues and concerns from civil society and the private sector. Boletín Oficial del Estado de Guinea Ecuatorial. 2020. Materia de inversión. Link 82   OHADA is a multinational association created in 1993, currently made of 17 member states across Central and West 83   Africa and aiming at harmonizing business laws and implementing institutions to enable private sector led growth in the continent. 125 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Box 11 Regulations related to digital businesses E-Commerce: In 2019, the government drafted an e-commerce bill; however, there has been no news regarding the status of the draft law. Personal Data Protection Law Num. 1/2016 dated 22 July. The data protection law bears a resemblance to similar frameworks in the region. It includes important prin- ciples such as consent, responsibilities for data controllers and processors, and the necessity for personal data collection to align with explicit, relevant, accurate, and up-to-date purposes. The law also outlines the rights of individuals regarding their data and general requirements for notifying data processing activities. However, the data protection authority established by the law is not currently operational. Greater attention is needed for the enforcement and awareness of this law. Intellectual Property Law Num. 5/2000. The government has taken steps to protect intellectual property right, signing the agreement to become a member of the World Intellectual Property Organization (WIPO) and establishing an Intellectual Property Office to provide support and guidance to businesses and individuals seeking to register patents, trademarks, and copyrights. E-signatures and e-documents Law Num. 2/2017. Despite being published in 2017, the country has still not been able to establish a mechanism to certify electronic signatures and electronic documents. This lack of implementation has resulted in a delay in the enforcement of the law. Electronic Communications Law Num. 2/2016. The law does not explicitly define sensitive personal data. However, Article 41(d) states that it is considered a signif- icant violation to process or disclose personal data related to an individual’s con- science, political affiliation, health, sex life, race, tribe, religion, or any other form of discrimination without the explicit authorization of the data owner. General Telecommunications Law of 2004. This law regulates the sector in Equa- torial Guinea, including the provision of internet and mobile services, among other related matters. However, it is not effectively enforced, and there is no entity responsible for its implementation. (See chapter on Digital Infrastructure for more details). 126 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Markets Equatorial Guinea actively participates in the two main regional economic communities in Central Africa, namely CEMAC and ECCAS and is part of the African Union, but policies to facilitate integration are still a challenge. The country ratified the Agreement Establishing the African Continental Free Trade Area (AfCFTA) on July 2, 2019. However, in practice, Equatorial Guinea is one of the least integrated countries in Central Africa. According to the Africa Visa Openness Index, the country ranked lowest in both 2018 and 2019 due to visa and residence permit restrictions that affect access to human capital for digital business.84 Efforts are focused on promoting trade through in-country regulatory reforms, tariff measures, and the development of e-commerce. Regional integration is encouraged by implementing regional trade agreements, improving the enforcement of the CEMAC customs code, reducing tariff barriers, and creating an action plan to position the country’s ports as gateways to other regional countries. Enhancing the legal framework is also a priority, ensuring transparency in trade regulations, establishing a specialized commercial court, and ensuring compatibility with OHADA law. The government lacks a dedicated entity for promoting and supporting the development of digital solutions for the public sector by private digital businesses. It is of utmost im- portance to leverage the opportunities provided by public procurement of ICT solutions and services. The establishment of an agency fostering digital adoption by government entities (see chapter on public digital platforms) would enable a strategic approach to digital technology adoption, ensuring that the government stays at the forefront of digital transformation and provides effective solutions to incoming digital challenges, building on and catalyzing private digital business solutions. Africa Visa Openness Index, Link 84   127 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Box 12 The United Arab States’ transformation by diversifying its economy through technology and digitalization The United Arab Emirates (UAE), historically reliant on oil and gas revenues with many state-owned enterprises (SOEs), has embarked on a significant economic transformation. Dubai, in particular, has become a global technology and trade hub, attracting technology companies and startups worldwide due to its strategic location and favorable business environment. Dubai’s “Smart Dubai” program has digitized government services, improving ef- ficiency and residents’ quality of life. Tech-friendly zones like Dubai Internet City and Dubai Silicon Oasis offer tax incentives and state-of-the-art facilities for tech companies and startups. The UAE has also invested in technology firms through various funds and support programs, fostering innovation and entrepreneurship. Additionally, their invest- ment in renewable energy, notably solar power, has diversified the energy mix and reduced dependence on oil. This transformation positions the UAE as a leader in innovation, entrepreneurship, and sustainable economic growth. Source: United Arab Emirates University (2022). The post-oil strategy of the UAE: An example of diversification strategies and challenges. Link The large presence of state-owned enterprises (SOEs) in primary and services sectors offer an opportunity to support digital technology adoption and create spillover effects within their sectors and value chains. These SOEs include Sonagas (natural gas), GEPetrol (oil), SEGESA (Sociedad de Electricidad de Guinea Ecuatorial), GECOMSA and GETESA (telecommu- nications), SONAPESCA (fishing), ENPIGE (low-income housing), and Ceiba Intercontinental (national airline). Digital technology adoption will not only help reduce costs and enhance productivity and resilience of SOEs, but also of local suppliers and buyers. SOEs could adopt digital solutions to interact with suppliers and customers for invoicing, logistics, billing, payments, and complementary services, supporting digitalization along their value chain (Box 13). Furthermore, offering open API solutions for mobile payments could boost the development of other complementary applications; the experience of mobile operators in 128 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Africa has showed positive effects on engagement of startups.85 However, as discussed in chapter 3, various constraints affect the availability and use of mobile payments in Equa- torial Guinea. Box 13 The digitization strategy within the Emirates National Oil Company’s energy sector Enoc (Emirates National Oil Company) has been developing a digitization strategy in the energy sector with the aim of modernizing and optimizing its operations. This strategy focuses on the implementation of digital technologies and innovative solutions to enhance efficiency, sustainability, and the customer experience across the entire energy value chain. In 2019, the Group embarked on a range of initiatives as part of its overarching strategy to expand its business portfolio. One noteworthy endeavor was the introduction of “Next,” an accelerator program meticulously craft- ed to harness growth prospects and address challenges within the energy sector. This initiative was centered around the creation of novel digital ventures, catering to both business-to-business and consumer markets. Within the framework of Next, the Group unveiled two pioneering digital ven- tures. Firstly, ENOC Link, a groundbreaking digital mobile fuel delivery service, was launched to cater to the needs of businesses in the United Arab Emirates (UAE). Secondly, Beema emerged as the UAE’s pioneering pay-per-kilometer car insurance provider. Source: ENOC to invest AED 250m in progressing digital transformation across the Group (2021). Link Developer Safaricom website in Kenya. Link: https://developer.safaricom.co.ke/APIs. 85   MTN Mobile Money in Uganda. Link: https://www.cgap.org/blog/mtn-mobile-money-opened-apis-was-it-worth-it.   129 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Human Capital The digital ecosystem in Equatorial Guinea faces significant challenges due to a scarcity of skilled workforce. Startups struggle to find qualified employees who possess the neces- sary technical and soft skills required for their operations. In particular, the lack of specific skills essential for tech startups, such as data scientists, exacerbates the talent shortage. As described in the digital skills chapter, the scarcity extends beyond general engineering and digital competencies, making it even more challenging for startups to find individuals with specialized expertise. This shortage of skills hampers the growth of startup founders themselves, as they often lack the necessary capacity to successfully scale their ventures. Many startups interviewed expressed that their primary obstacle is the cost associated with hiring skilled professionals. Restrictions on visas and temporary work permits also affect knowledge transfer and access to regional and international skills. Summary of Constraints for Digital Businesses Access to Finance. Accessing finance remains a significant challenge for digital businesses and entrepreneurs in Equatorial Guinea. The stringent requirements set by financial insti- tutions make it difficult for businesses to secure the necessary funds through bank loans or incubator accelerator programs. To overcome this challenge, it is crucial to focus on attracting external investments and engaging venture capital and angel investors. Busi- nesses should prepare thorough documentation, including a well-structured business plan, financial projections, and evidence of market demand, to increase their chances of securing investments. Digital Skills Shortage. The shortage of qualified individuals with digital skills is a notable hurdle. Although there are various training programs available, there is a lack of continu- ous and comprehensive digital skills training in schools and universities that aligns with the needs of the private sector. Furthermore, the ability to access the international pool of qualified staff is impaired by visa and work permit restrictions. Bridging the gap between the supply and demand for digital skills is essential to drive digital development in the country effectively. Digital Infrastructure Limitations. Digital infrastructure limitations pose challenges in ac- cessing digital services across Equatorial Guinea. While there has been progress in internet access, mainly in Bata and Malabo, the coverage is limited to these areas. Expanding net- work coverage to encompass the entire island and the continental region is vital to ensure widespread access to digital services for the entire population. 130 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Weak Legal Framework. The presence of a weak regulatory framework hampers the de- velopment of the digital private sector in Equatorial Guinea. While efforts are underway to develop the regulatory framework and implement digital laws, effective enforcement is crucial. In addition to developing regulations covering areas such as e-commerce, com- petence requirements, cybersecurity, and access to finance for digital businesses, it is also essential to establish a comprehensive directory that compiles the laws and regulations governing the country. Furthermore, creating strong enforcement mechanisms for the ex- isting legal framework is vital to ensure compliance and foster a supportive environment for the flourishing of digital businesses. Data Absence. Low levels of quality data collection in the country hinder private sector development and the ability of the government to design appropriate interventions to sup- port the sector. Informed and strategic business decision-making relies heavily on accurate and up-to-date data regarding market dynamics, consumer demand, and economic trends. Without this information, businesses are constrained in their ability to invest confidently and expand efficiently. Furthermore, it is an established fact that the absence of adequate government data can lead to poor policies and hinder the creation of a conducive business environment. The availability of reliable data is fundamental in designing effective and efficient policies that streamline regulations, reduce bureaucracy, boost digital trust, and promote private-sector investment, driving economic growth and job creation through the private sector. 131 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC 4.3 | DIGITAL BUSINESSES RECOMMENDATIONS DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION GENERAL POLICY ENVIRONMENT AND COORDINATION Articulate a roadmap to support digital entrepreneurship and productive use of digital technologies: The new Digital Agenda offers an opportunity to develop a roadmap with a clear definition of roles, resources, and objectives for different government entities as well as specific targets and monitoring framework for the implementation of actions to support digital business. Clarifying the leading institution to monitor the implementation of the Investment digital agenda, particularly on actions related to digital Growth and policy Quick win business, will help to ensure more effective government reform interventions in the sector. Having a strong leading institution to facilitate collaboration with private sector, academia, civil organizations as well as interinstitutional coordination is essential to ensure improvements across other pillars of the digital economy - digital infrastructure, digital finance (payments), digital skills - that provide the enabling environment for the growth of digital businesses. Promote public-private dialogue in the area of digital businesses: Given the changing nature of digital technologies and the variety of business models, it is vital to maintain public-private dialogue to inform policy implementation, design of regulatory instruments and measures to enhance effectiveness of support programs. Therefore, designating a representative from the public sector, such as the Ministry of Commerce, and giving Growth Capacity Quick win voice to various private sector associations, such as EMEG, is crucial. This enables the exchange of insights and ensures that the strategy and its implementation remain aligned with the sector’s needs, this contributes to the design of more effective policies and provides a much faster maneuvering space that enables quick adaptation to market needs. 132 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION ENABLING DIGITAL REGULATORY ENVIRONMENT Develop regulatory and policy reforms that consider the intrinsic nature of digital entrepreneurship: Equatorial Guinea should build on the progress made on the VUE and further enhance general business regulations and implementation for business registration taking into consideration the nature of digital business including in relation to capital requirements and categories of business activities, among others. Reforms to facilitate paying taxes and access to credit are essential, as well as rules related to visas and work permits to enable access to a larger pool of human resources. Frameworks to promote foreign direct investment and private investment in general would further support Medium Growth Policy reform the expansion of digital business. In order to enhance term regulatory frameworks for business development, the following actions should be prioritized: (i) ensure the implementation and enforcement of the OHADA commercial law, with a particular focus on ensuring accessibility (translating them to Spanish and publishing laws, regulations and procedures); (ii) create effective enforcement mechanisms, a clear judicial career and a specialized commercial court to ensure compliance with the existing legal framework and proper dispute resolutions mechanisms, and (iii) update and maintain the BOE (Boletin Oficial del Estado) providing easy and free access to the country legal framework. Focus on developing essential digital market regulations and effective institutions to create digital trust and boost digital technology adoption and innovation: It is necessary to address notable gaps in legislation covering areas such as online consumer protection, online supplier protection, intellectual property rights, data protection and privacy, regulations related to data use, sharing and reuse, e-signature, e-commerce, and e-procurement. Inclusion and Additionally, clear guidelines are needed for accessing Policy reform Long term Productivity and sharing information, and effective mechanisms to ensure cybersecurity and combat cybercrime. For example, Equatorial Guinea could adopt international standards for cyber security and data protection to facilitate cross-border digital trade, and in line with the African Union Data Policy Framework. Furthermore, reforms to tackle absence of an addressing system will alleviate constraints on e-commerce. 133 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION DIGITAL TECHNOLOGY ADOPTION AND DEMAND FOR DIGITAL BUSINESS SERVICES Promote digital technology adoption as part of the diversification and economic transformation agenda: Digitalization of primary sectors - agriculture, fishing, and forestry can lead to transformative change and at the same time create demand for digital solutions by domestic entrepreneurs. Digital technologies offer opportunities to improve productivity and efficiency through tools such as precision farming, IoT (Internet of Things) devices and data analytics. Digital technologies can also be used for more efficient monitoring and exploitation of fishing and forestry resources to ensure sustainability. State-owned enterprises could support adoption of digital technologies in their operations and generate spillover effects across their value chains. Enhancing the statistical capacity of INEGE and VUE’s Medium Growth Policy reform data collection strategy, along with the creation of a term consolidated database of information publicly available from different offices. This will enable the monitoring of the digital business ecosystem and the policy alignment with the needs of the private sector landscape - both digital sector and sectors with potential to adopt digital technologies. Based on these insights, tailored policies and support programs could be formulated. Moreover, aggregated business census data can be used by digital businesses to estimate market size for their services and innovations. Support to MSME for the adoption of digital technologies through finance, capacity building and integration across value chains and access to export markets through digital technologies should be considered. Consider public procurement as a source of demand for digital services: Public procurement of ICT services can support the development of a local digital ecosystems and facilitate technology transfer through partnerships Growth Policy reform Long term involving local and foreign suppliers. This can also further support the adoption of data protection and cybersecurity standards by suppliers. 134 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION VIBRANT, COHESIVE, AND INCLUSIVE DIGITAL ECOSYSTEM Promote the development of an inclusive digital entrepreneurship ecosystem: The system to support the digital innovation system –entrepreneurship support organizations, incubators, and accelerators, such as EMEG, Identic and Dreams Hub (to accompany entrepreneurs locally and across the diaspora)– could be enhanced through greater coordination, transparency, and monitoring of the dynamics of the startup and incubator ecosystem. The government could undertake a proactive approach to promote and highlight the achievements and contributions of startups and incubators through various means, such as organizing events, launching awareness campaigns, and creating online platforms that showcase success stories and provide resources for aspiring entrepreneurs. Increasing access to information on the services provided to support entrepreneurs, including requisites to access grant programs, is essential for greater participation of diverse entrepreneurs. To support female entrepreneurs, entrepreneurship support programs should consider Productivity women-specific needs and challenges. To complement Policy reform Quick win and Inclusion these efforts, fostering collaboration between universities, schools, and the private sector is crucial. Aligning education with market demands ensures graduates possess relevant skills and knowledge. By establishing strong partnerships, educational institutions can adapt curricula and programs to evolving private sector needs, incorporating needs assessments and offering work-integrated learning like internships and industry placements. Based on an in-depth analysis of digital entrepreneurs’ bottlenecks, market failures and government failures, start up support programs can be designed considering the appropriateness of the instrument, proportionality of the benefits provided, expected direct and indirect effects (e.g., on markets, fiscal accounts), and availability of adequate governance mechanism (transparency, monitoring and evaluation). This could include seed funds, partial credit guarantees and matching grants, among others. 135 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC @ Quality Stock Arts / Shutterstock 136 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC 5 | DIGITAL SKILLS 5.1 | IMPORTANCE The use of digital technologies is expected to significantly enhance productivity, with the economies of tomorrow demanding a larger number of digitally skilled workers. By 2030, the demand for digital skills in Sub-Saharan Africa is projected to experience a significant surge, creating a need for more than 230 million jobs. This presents a substantial invest- ment opportunity of approximately US$130 billion for digital skilling in the region (IFC, 2019). Equatorial Guinea, in particular, stands to benefit from this trend as digital skills have the potential to open up a broader range of employment prospects, especially for the youth, which constitutes the largest portion of the country’s population. The demand for digital skills training will surge in the coming decade, as jobs that pre- viously did not require digital skills will begin to do so. Analysis of other countries in Sub-Saharan Africa shows that some level of digital skills will be required by 50-55 percent of all jobs in Kenya, 35-45 percent of all jobs in Côte d'Ivoire, Nigeria, and Rwanda, and 20-25 percent of jobs in Mozambique (IFC, 2021). While the services industry will take the majority of these jobs, manufacturing and agriculture, increasingly require digital skills as well. Thus, digital skills can play a key role in helping diversify Equatorial Guinea’s economy reducing the country’s oil dependency, creating better-paid jobs, and increasing access to information. Even though the evidence from the literature examining the labor market returns of digital skills in developing countries is nascent, a few studies show positive effects on employment and earnings. For example, a study from India shows that individuals with digital skills earn 10.9 percent higher wages than those without digital skills (Smith, 2016). Studies in developed countries estimate a 3-10 percent increase in earnings (Non et al., 2021). In Sub-Saharan Africa, when faster internet became available, the probability that an in- dividual is employed increased between 6.9 and 13.2 percent, for countries in different samples. The increase in employment in these areas was not due to displacement of jobs in unconnected areas (Choi et. al., 2020). In addition, the acquisition of digital skills can play a crucial role in promoting inclusion by empowering women and people with disabilities with enhanced access to essential services and fostering financial inclusion. The COVID-19 pandemic highlighted the significance of digital skills in ensuring continued learning even 137 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC during school closures. Similar disruptions caused by climate change or insecurity can also be mitigated when the population has solid digital literacy levels. Digital skills are categorized into various levels, which range from basic to intermediate to advanced. According to the European Commission, there are three primary types of digital skills. First, basic digital skills empower individuals to participate in the digital society, such as using digital applications for everyday purposes, conducting basic Internet searches, and staying safe online. Second, intermediate digital skills are needed in most digitally enabled workplaces, including new skills for established workers in sectors that are adopting digital avenues and skills for seeking work in the digital economy. Third, advanced digital skills are necessary for ICT experts and leaders across all industry sectors. 5.2 | DIAGNOSTIC FINDINGS: CURRENT STATE OF DIGITAL SKILLS The following chapter discusses the current state of digital skills in Equatorial Guinea. It first looks at the policy framework, including institutional structure, government programs, and education strategies. Then the chapter evaluates the education sector performance and the supply of digital skills, including access to education, quality of education, teachers’ capacity, and practices, to conclude with higher education and TVET contexts. After discuss- ing the policy framework and education sector, the chapter then looks at the demand for digital skills both in the private and public sector, identifying current gaps and bottlenecks hindering the alignment between demand and supply of digital skills in the country. Final- ly, the chapter proposes policy recommendations. Table 17 below portraits how there is a lack of data in terms of digital skills, with Equatorial Guinea not included in the databases checked (i.e., UNESCO and ITU), and general lack of data for other countries. The aspirational and structural peers with data seem to be performing well. For instance, Azerbaijan has 64.6 percent of its lower secondary school with access to the internet and Qatar has 5.96 percent of its youth and adults with advanced digital skills. 138 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Table 17 Digital Skills Indicators Benchmarking STRUCTURAL PEERS ASPIRATIONAL PEERS (Central African Republic) Timor-Leste Congo Rep. Azerbaijan Costa Rica Cameroon Singapore Mauritius Gabon Qatar EQG UAE CAR INDICATOR INTERNET CONNECTIVITY IN EDUCATION INSTITUTIONS Percentage of lower-secondary schools with 64.6% 83.6% 100% 100% N/A N/A N/A N/A N/A N/A 100% N/A access to internet (2020) (2020) (2019) (2020) for pedagogical purposes DIGITALLY COMPETENT WORKFORCE Proportion of youth and adults with 0.69% N/A N/A N/A N/A N/A N/A 17.91% N/A 7.14% N/A 5.06% advanced digital (2018) skills* Source: UNESCO-UIS (2021), ITU WTID (2019). *4.4.1 SGD Indicator. We assume that an individual has advanced digital skills if he/she has engaged in the following computer-based activities: writing a computer program using a specialized programming language. Policy Framework The education system in Equatorial Guinea is comprised of four main levels: preschool, pri- mary, secondary, and higher education, with preschool and primary considered mandatory. Complementary education modalities include Permanent Training and Adult Literacy Edu- cation, Long Distance Education, and Special Needs Education. The general management of the entire education system is assigned to the Ministry of Education and Science (Ministerio de Educacion y Ciencia MEC in Spanish). Its principal functions include proposing education policies and programs; approving curricular programs; creating and managing public edu- cation centers and approving and regulating private centers; coordinating and stimulating 139 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC different social and economic stakeholder efforts; and issuing and accrediting diplomas and certifications. The Ministry has a specific unit related to technology education, but it lacks specific programs and interventions aimed to increase digital skills. According to the General Education Law (2007) (Ley General de Educación in Spanish), the Ministry of Education, Science, Higher and Professional Education is responsible for de- termining the guidelines for education policy across education levels. The strategic vision for education was originally outlined in the Programa Mayor Educación Para Todos 2003- 2020, approved by Presidential Decree in 2003. This document made Equatorial Guinea the first country in Central Africa to develop a National Plan for Education for All. The main goals included: universal enrolment in preschool and primary with a 98 percent Gross Enrollment Rate (GER) in secondary; improvement in the quality of education by ensuring adequate teacher preparation, with a focus on primary; elimination of gender disparities by reducing dropout rates among girls in primary and secondary and improving higher education completion rates among young women; adaptation of professional, technical, and higher education to the needs of the labor market; expansion of professional training to all provincial capitals; and increase in literacy rates to above 75 percent among adults. While the plan outlined the Government’s main goals it did not include a clear implementation plan, a monitoring and evaluation framework, a description of roles and responsibilities or accountability for achieving results. In 2015, the plan was reviewed and some of the progress was summarized, including the expansion in access to education, large programs for training teachers, and the creation of “active schools” with personalized instruction. In addition, the plan does not specifically focus on digital skills or ICT. Education also held an important place in the National Agenda for Diversified Sources of Economic Growth (Agenda Nacional para la Diversificación de las Fuentes de Crecimiento in Spanish), commonly referred to as Guinea Ecuatorial Horizonte 2020. The Horizon 2020 Education Program for All (Horizonte 2020 Programa Mayor Educación Para Todos in Span- ish) provides an overview of system-wide priorities and needs in education, in addition to defining areas that are to be addressed through government actions and partnerships. Another important initiative is the Program for Education Development in Equatorial Guinea (Programa de Desarrollo Educativo de Guinea Ecuatorial in Spanish) (PRODEGE), developed by the Ministry but managed by Family Health International (FHI) 360 (a non-profit) as a public-private partnership between the national government and the Hess Corporation. Its objective was to improve quality of education for both public and private schools. The program focused on training two thirds of the country’s primary teachers, establishing model primary schools, and improving information systems. The program ended in 2019 but was to have been critical for the development of the education sector in the country. 140 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Despite all these initiatives focused on education development in the country, digital skills aren’t included in any of the initiatives. As described in box 1, Agenda 2035 aims to eradicate poverty and aspires to “value peo- ple, knowledge, and innovation as drivers of growth.” The document includes a section on “education policy” that incorporates a specific measure on digital skills. More specifically, one of the measures mentioned is the dissemination and integration of ICT in education in order to provide young people with the acquisition of knowledge and the development of specific ICT professional skills with high employability potential. Similarly, the employ- ment promotion and human resources policy emphasizes technological training as critical for the country’s economic development. In the same vein, the youth policy highlights the democratization of ICTs as a critical measure. These statements are important but occupy a relatively minor position in the context of the entire agenda. To summarize, the digital skills policy framework is currently inadequate, given the absence of a specific ICT policy in education, the fragmentation of decision-making across multiple agencies, and the existence of isolated programs funded by partners (such as FHI 360). The country does not have a digital skills framework and the overall skills qualification frame- work does not feature digital skills prominently. Most of the digital skills interventions are made by civil society organizations or the private sector and are not at scale, which creates a fragmented system. In order to foster innovation and job creation Equatorial Guinea still relies on a 1992 labor law (Law on the Investment Regime), which establishes a number of incentives.86 Among these, the most appropriate one to foster digital skills development is the one that stipulates that for the training of national personnel, companies will benefit from a reduction in their taxable income for Income Tax, in an amount equivalent to 200 percent of the non-wage cost attributed to the training of national employees of the com- pany. However, this has not been utilized to invest specifically in digital skills, and the law does not have specific provision to incentivize digital skills. (i) A reduction in the company’s tax base equivalent to 50 percent of the salary of an employee in a newly created 86   position; (ii) a reduction in the company’s personal income tax equivalent to 200 percent of the cost of training offered to local employees; (iii) a credit worth equivalent to 15 percent of non-traditional exports value, which can be used in the payment of any fiscal obligations; and (iv) additional incentives offered to investors operating in the country’s rural areas, as described in the government’s tax law. 141 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Box 14 Data availability as a critical constraint In 2022, the World Bank launched a comprehensive Regional Education Strategy tailored for Western and Central Africa. To ensure that the strategic recommen- dations were aligned with the unique circumstances of each nation, a specialized country classification system was devised. This system relied on various indicators that measured both the quality and accessibility of education. However, Equato- rial Guinea presented a unique challenge: it was the only country that could not be categorized in either basic or post-basic education sectors due to a glaring absence of reliable data. This data scarcity extends to the realm of digital skills, where Equatorial Guinea similarly lacks a presence in international databases that facilitate cross-country comparisons through standardized methodologies. The un- availability of dependable, wide-ranging data in Equatorial Guinea’s educational landscape is a substantial obstacle to the planning and execution of effective public policies, including the enhancement of digital skills. Comprehensive and accurate data serves as the backbone for identifying educational needs, pinpointing gaps in digital competencies, and highlighting areas in need of improvement. Further- more, it is indispensable for making well-informed policy decisions. Without such data, it is virtually impossible to evaluate the efficacy of existing policies, gauge developmental progress, or allocate resources in a manner that maximizes impact. Therefore, rectifying this data deficiency is crucial. Doing so will enable Equatorial Guinea to formulate evidence-based policies that not only induce positive societal change but also guarantee universal access to high-quality digital skills, while im- proving transparency and accountability. Across all the recommendations presented in this chapter, improving data must be considered a priority. The development of a robust education management information system could contribute to improve the situation. 142 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Access to Education in Equatorial Guinea Access to education has expanded significantly in the last couple of decades, but it still lags behind most countries in the region. There has been an increase in the number of students enrolled. From 2014/15 to 2017/18 total enrolled students in primary increased by over 20 percent and by over 40 percent in secondary. Despite these improvements, according to the World Bank 2017 Education Diagnostic, primary education gross enrollment rate (GER) is estimated to be between 62 percent and 86 percent (depending on the base population data used) (World Bank, 2017). The UNESCO Institute for Statistics reports 62 percent without any differences across genders, which is significantly lower than most countries in the region and lower than what would be expected for the country’s income level. This is also much lower than the aspirational and structural peers, as well as than other countries in CEMAC, all of which are above 94 percent. Countries like Central African Republic (128 percent) and Cameroon (106 percent) are also well above Equatorial Guinea. System challenges, particularly due to high repetition rates (above 16 percent in early grades) and high attrition rates, impact the ability of the system to show positive results. Additionally, a lack of equity, particularly in terms of gender and socioeconomic levels, is evident. The Education Diagnostics shows equitable access to education at the primary level by gender but starting at the age of 14, different attrition rates are manifested. When students begin to drop out of school, girls drop out more than boys, and by age 16, girls begin to drop out in much higher numbers ending up with a 10 percent enrolment gap between boys and girls. Legal restrictions banning pregnant girls from attending school (in force since the approval of a decree in 2017) and evidence of high levels of early preg- nancy may be part of the reason for this increase in female school dropouts after age 14 (World Bank, 2017). Access to the Internet in schools is extremely low and concentrated in the capital, although official statistics are not available. As described in the digital infrastructure chapter, Equa- torial Guinea suffers from many challenges with respect to access to the internet, and the average speed is one of the lowest in the region. These infrastructure deficiencies pose a significant challenge in effectively leveraging technology for educational purposes. 143 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Figure 15 Relation between Primary Gross School enrollment (%) in relation to peers. 160 Primary Gross School enrollment (%) 120 Timor-Leste Gabon Bahrain Qatar Congo, Rep. Azerbaijan Oman Kuwait 80 40 0 3.0 3.5 4.0 4.5 5.0 Ln GDP per capita Structural Aspirational Other countries Source: World Bank based on UIS and World Development Indicators, latest available data. Other forms of inequity manifest across regions in Equatorial Guinea, especially in rural areas in the continent, and for minorities such as people with disabilities. In rural areas, it is common to see schools that only have grades 1 to 3 or 4, with no opportunities to continue studying. Furthermore, most schools do not have any facilities designed to include children with disabilities. Quality of Education in Equatorial Guinea The challenges with respect to learning levels are more alarming, given the low proportion of students who show proficient levels across subjects. One of the most pressing con- straints is the low availability of learning data, given the lack of systematic measurement 144 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC efforts. The latest available data, from 2011, shows that more than 70 percent of grade 1 students were classified as “Low Achievement” (based on the test scoring categorization) in non-reading test components and at the end of grade 1, few students were able to write more than five words. The results in mathematics were also low, as fewer than 10 percent of grade 1 students achieved a “High Achievement” level. In other words, foundational skills seem to be extremely low, which constitutes a key challenge to develop digital skills in the short run and, therefore, to advancing the country’s digital economy in the medium term (INEGE, 2021). Between 2008 and 2011, PRODEGE applied a standardized test to monitor the impact of their programs at the primary level and measured student skills in language and mathemat- ics in grade 1. The 2011 assessment shows very low results, similar to the ones observed in the study cited above: 60 percent of the students classified as “Low Achievement” in reading (they were unable to read any words or could only read part of a single word); relatively few students were able to write more than five words at the end of grade 1; in mathematics, less than 10 percent of students achieved a ”High Achievement” level. The national end-of-secondary education exam (known as Selectividad in Spanish) also shows low student mastery of the curriculum (INEGE, 2021b). The test, which serves as an en- trance exam for higher education, has a very low pass rate, although it has gone up from 15.3 percent in 2016 to 25.8 percent in 2020. In 2014, however, it was above 50 percent. (INEGE, 2021b). Although Selectividad is a high-stakes examination, it isn’t a learning as- sessment to measure learning outcomes over time. Therefore, Selectividad has limited utility for monitoring the quality of the education system in the country. In 2021, UNICEF supported a large-scale learning assessment for public and private schools, a key step to measure learning more systematically. It is estimated that 14,032 primary students (7,136 from Grade 3 and 6,896 from Grade 6; 52 percent girls and 48 percent boys) were evaluated in Spanish and Mathematics. The Grade 6 students were examined in two additional subjects: Science and Social Science. The preliminary results indicate that 10,487 students (75 percent) passed the assessments. The discrepancies between public and private schools are minor: the passing rate for students enrolled in public schools is 72.5 percent, while for students in private schools is 76 percent (UNICEF, 2021). However, since the results are not available yet, it is not clear how the passing threshold is aligned with international standards such as the Global Proficiency Framework, which makes com- parisons difficult. The release of this information will be critical to understanding learning levels in Equatorial Guinea. 145 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Teachers’ Capacity and Teaching Practices While teacher training is improving, there are still low rates of qualified teachers (5 per- cent in preschool, 54 percent in primary school, and 69 percent in secondary school) and no mechanisms to hire or promote teachers based on performance (World Bank, 2017). Moreover, classes tend to be teacher-dominated, with a heavy reliance on dictation and taking notes and limited use of problem-solving and student-initiated dialogue. Learning materials, such as textbooks, are often in shortage. For example, in most primary grades, the ratio of students to textbooks is above 3 to 1, and in some cases, this ratio is much higher (World Bank, 2017). In terms of digital skills, there are no specific programs at scale to guarantee that teachers acquire basic digital skills, and it is not clear if the pre-service teacher training includes any digital skills. Finally, the shortage of teachers is more acute for specialized subjects (World Bank, 2017). Based on the limited data available and conversations with key stakeholders, it has become evident that teachers’ digital skills are in early stages. This poses a significant challenge in effectively leveraging technology for educational purposes. Furthermore, it is concerning to note that ICT has not been officially integrated into the curriculum at any level of edu- cation. The absence of ICT as a formal component of the curriculum hinders students from acquiring essential digital literacy skills, depriving them of the necessary tools to thrive in an increasingly digitalized world. Addressing these issues is crucial to empower teachers with the skills needed to effectively integrate technology into their teaching methods and to ensure that students are equipped with the digital competencies required for future success. Additionally, ensuring that even those who are out-of-school have opportunities to acquire digital skills is critical. Higher Education Context Beyond the basic education sector, the challenges persist, as shown by the poor outcomes in higher education, which shows low access levels. The UNESCO Institute for Statistics does not report recent data for Equatorial Guinea, but the latest figure available for the gross enrollment rate (2000) was one of the lowest in the world (2 percent) (UIS, 2022). In the past decades enrollment has grown, although it is still limited. The higher education system in the country is still relatively new and mainly consists of the offerings at the National University of Equatorial Guinea (UNGE, Universidad Nacional de Guinea Ecuatorial in Spanish). The number of students enrolled at the UNGE in the 2020-2021 school year was 7,925, of which 60 percent were male and 40 percent female. The number of enrolled students was slightly higher than the value from 2017-2018 (7,707), after a drop between 146 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC 2018 and 2020. The only degrees directly related with technology or STEM are the “Infor- mation Science and Linguistics,” “Engineering and Agricultural Technologies and Fishing.” In 2020, the graduates from Engineering and Technology represented 12 percent of the total (70 out of 584). Regarding teaching staff, UNGE has a total of 961 professors, most of which have a BA or engineering degree (720), although many have master’s degrees (144), and PhDs. (49). A portion has only tertiary degrees (48) (INEGE, 2022). The Afro-American University of Central Africa (Universidad Afroamericana de África Central in Spanish) also offers programs, but, according to official data, it has less than 500 people enrolled, al- though a significant portion in engineering. The university also has a total of 46 professors (14 PhDs., 522 Masters, and 10 Bas) (INEGE, 2022)). Box 15 COVID-19 and its impacts on education The COVID-19 pandemic exposed some of the widespread challenges that Equatorial Guinea faces in the education sector. The country spent 27 weeks with schools fully closed and 7 weeks with schools only partially opened. When schools had to close, as described in the access to education section, alternatives for remote learning were almost completely unavailable, which created a significant learning loss in the country, although the lack of systemic measurement prevents the quantification of these losses. Based on the experience from other countries, it is expected that the crisis increased the education gap among economic classes, with a heavier impact on rural areas, some of which are completely disconnected from the internet. The only government initiative for distance learning was “Schools in my house” (Escuela en mi casa in Spanish), a program launched by the Ministry of Education in collab- oration with UNICEF. It was delivered through TV, radio, and an online channel. It is estimated that 135,849 pre-primary and primary students were reached through TV and radio educational programs. Moreover, 118 TV sessions and 45 radio ses- sions were produced and broadcasted nationally, including in remote areas with scarce electricity coverage (UNICEF 2021). The online channel (escuelaencasa.gq) was created to store all the content from radio and TV but is currently not active, and it is not clear if it was utilized, given the low penetration of broadband internet in households. 147 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC TVET Context The Technical and Vocational Education and Training (TVET) space is also relatively incip- ient. As of 2020, the country had a total of 70 TVET centers, 38 in the continental region and 32 in the insular region. The districts of Bata and Malabo accumulate most of them, with 31 centers each (INEGE, 2022). 25 of the centers are of higher grade, 26 of medium grade, and 19 are only for occupational training. (INEGE, 2022). Most of the TVET centers are private. In practice, a national certification commission is responsible for the recogni- tion of all qualifications issued by public and private centers accredited in formal training delivery. Recently, the government has been supported by the Africa Development Bank to create some polytechnics across the country (INEGE, 2021). Many of the training centers aim to provide the skills needed for the current economy of Equatorial Guinea, but they are not typically conducive to the objective of diversifying the economy. On the one hand, centers such as the National Technological Institute of Mines and Hydrocarbons of Equatorial Guinea (Instituto Tecnológico Nacional de Minas e Hidrocarburos de Guinea Ecuatorial in Spanish), offer many technical programs that are aligned with the petrol-intensive nature of the economy. On the other hand, access to digital skills training is limited and usually fragmented, without a clear strategy to develop the skills needed to diversify the country’s economy and reduce its dependency on extractive industries. Beyond the formal TVET centers, training programs are available but not at the scale that is visible in other African countries, and they suffer from poorly negotiated and ineffective inter-ministerial collaboration. The government and some national and/or international companies have set up several training schemes, particularly in the agriculture, fisheries, mining and oil and gas sectors, to quickly and effectively develop the skills of their staff or of the young people they wish to recruit later. These schemes include in-house train- ing through an internal supervision system of the learner who becomes familiar with an occupation through hands-on practice, training abroad where a staff member working for one of the multinationals in Equatorial Guinea is transferred to an African subsidiary, and peer-to-peer training via a form of mentoring provided by experienced professionals from abroad (World Bank, 2017). However, there are no specific training schemes for digital skills. Programs led by large tech organizations do not seem to be available at scale, but some opportunities exist. One of the most interesting ones is promoted by the IDENTIC Foun- dation, a technological innovation organization whose main mission is to support and create technological projects in the country (See Digital Businesses Chapter for additional information on IDENTIC). Regarding digital skills, IDENTIC has four areas of activities: an 148 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC academy focused on digital skills and social responsibility projects that aim to reduce dig- ital skills gaps. IDENTIC academy offers a catalog of training in digital skills, in some cases in collabora- tion with other educational centers, such as Foundation Martinez (from Spain) and the Afro-American University of Central Africa (AAUCA). The academy also aims to create a learning platform and be a reference for different companies for the training of their em- ployees. They also aim to train and deploy teachers with technical skills to become STEM ambassadors in the country’s schools. Going forward, IDENTIC aims to achieve synergies that place and recognize the ownership or certifications of IDENTIC ACADEMY at the in- ternational level. In February 2023 IDENTIC launched a community called Girls in Technology (Chicas en Tecnologia, CET in Spanish), with the objective of addressing the under-representation of women in the technological space. CET is a space for accompaniment, advice, support, spe- cialization, and motivation for all girls from Equatorial Guinea interested in ICTs. Currently, the network has at least 98 members. The target population is women between the ages of 16 and 30, interested in technology, including university and pre-university students. The initiative includes plans for the training of girls. More specifically, the plan is to train at least 50 girls on digital skills each year, inspire girls to pursue careers in STEM, obtain higher-education scholarships for girls working on ICT, and join international initiatives such as SheCodes Africa, hertechtrail, Afro-Tech Girls, FemCode Africa, Baddies in Tech, and She Secures. The initiative also highlights the role of women in tech as role models for other young women in the country. Currently, CET is offering several courses, including intro- duction to ICT, Electronics and Robotics, web design, front-end development of webpages, Mobile chat design, and Introduction to UI and UX, The private sector is incipient and, therefore, does not have large-scale programs for digi- tal skilling. Public-private partnerships for digital skilling seem not to be available. In this context, even though both IDENTIC and its CET initiative are in their nascent stages, they are presenting a remarkable opportunity to broaden the provision of digital skills training. By doing so, they hope to stimulate interest and motivate individuals -especially women- to pursue careers that require digital skills. 149 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Table 18 Programs to develop digital skills ENTITY DESCRIPTION Through a collaboration with Technobot, PNUD granted 12 scholarships in New PNUD and UNGE Technologies and AI for UNGE students, with a duration of one academic year, and they will receive a subsidy of 200,000 XAF (equivalent to 360USD) The GITGE Educa program aims to drive digital transformation in the education sector, GITGE providing not only computer classrooms in public educational centers throughout the country but also free access to fiber optic internet. TEG Campus is a youth-focused technology event aiming to bridge young talents and GITGE the corporate sector and promote economic diversification through the technology sector. Dreams Hub The institution offers courses in digital skills Girls in technology is a community that offers guidance, advice, support, specialization, and motivation to Guinean-Ecuadorian girls interested in Information and Communication Technologies (ICT). The project arises from the absence of a specialized community in the country and aims to inspire vocation in girls while ensuring equal access and participation in the field of ICT. The objective of this IDENTIC community is to promote participation in technology events and provide learning opportunities. Quarterly workshops are conducted to provide basic knowledge in various technological fields, including introduction to computer science, electronics, and robotics; web page development; chat system functioning; and introduction to UX (User Experience) and UI (User Interface). The Demand for Digital Skills in the Private Sector Digital skills tend to be required across sectors, from primary to tertiary activities. As ob- served in other countries, structural transformation also brings a higher demand for digital skills, since manufacturing and services tend to require more digital skills than agricultural jobs. The percentage of the population currently working in the agricultural sector in Equa- torial Guinea (56 percent) is high for an upper middle-income country (21 percent). On the contrary, only 14 percent of the population works in manufacturing (versus 26 for upper middle-income countries). 31 percent of the population works in services, compared to 53 for upper-middle income countries (ILO, 2021). Despite these figures, even the current levels of digital skills do not seem to fit the demands of the labor market. 150 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC The incipient private sector reports serious difficulties in finding local talent and human resources with appropriate digital skills. This includes both basic digital skills and more specialized skills. To fill this gap, some companies rely on two different strategies. First, some of them recruit foreign workers, although this strategy is more feasible in sectors with high-profit margins, such as the oil industry. This strategy is also prevalent in the telecommunication sector, and it tends to happen for higher-level managerial positions. For instance, GECOMSA, one of the main telecommunication companies, has consistently recruited workers abroad to find a specific set of skills. Second, other companies tend to train their personnel internally, based on interviews with key stakeholders. An example of this second strategy is illustrated by BANGE business school, hosted as part of the National Bank of Equatorial Guinea. The school was created as a consequence of the difficulties for the bank in recruiting local talent and its need to train employees abroad. Even though the school is specialized in banking and financial topics, it also teaches tech-re- lated subjects, such as cyber-security and artificial intelligence. The Business School has been working for over two years, and currently has an alliance with UDIMA (Universidad a Distancia de Madrid), the Distance University of Madrid, which provides certifications for the courses. The school has plans to open an additional campus in the continental region. Interviews with key stakeholders show that the Business School is currently harnessed by several banks in the country, such as the Société Générale de Banques from Equatorial Guinea. Many public sector agencies also rely on the business school to train their public servants. The Demand for Digital Skills in the Public Sector In the public sector, the lack of digital skills is a clear bottleneck, with many employees not even having basic digital skills. This is despite the clear motivation of many officials to improve their digital skills and expand the digitization of government services, which is currently at very low levels. There is no systemic plan to train government workers on digital skills. As described in the Digital Public Platforms pillar, the main body responsible for training public servants is the National Institute of Public Administration (INAP, Instituto Nacional de Adminsitración Pública in Spanish), whose objective is to develop and execute policies for the selection, training, and retraining of public employees. The digitization of the public sector is formally supported by National Center for the Digi- tization of the Public Administration (Centro Nacional Para la Informatización de la Admin- istración Pública de Guinea Ecuatorial in Spanish, CNIAPGE). Its mission is to create, manage 151 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC and implement electronic government practices in the country (See Digital Public Platforms chapter for additional information on CNIAPGE). While some progress has been made recently, especially through the designation of focal points comprised of IT staff in each ministry, CNIAPGE still faces many challenges. In par- ticular, the interoperability across government organizations is very low, with high levels of fragmentation across systems. Other government entities are not necessarily committed to the deployment of digital technologies. The widespread lack of digital skills is one of the main obstacles. Furthermore, many ministries and government agencies do not have inter- net connection or lack reliable connectivity, which makes digitization difficult. Additionally, interviews with key stakeholders have shown that the services provided by CNIAPGE are expensive and lack the needed flexibility to adapt to the needs of different public organi- zations. However, there are opportunities that could be exploited. CNIAPGE seems to have a clear aspiration to lead the expansion of digital government services and replicate agencies from other countries, such as Singapore, that not only provide services for the public sector but also for the private one. Other organizations could also be harnessed. The recent UN-E Government Survey can shed some light on understanding the low levels of digital skills available in Equatorial Guinea and the very incipient demand. The report in- cludes an e-government ranking, and Equatorial Guinea appears in position 183, among the lowest in the world, with an E-Government Index of 0.27. The e-participation index is also very low, at 0.16. This shows the low incidence of digital tools in the government, which, in turn, affects the demand for digital skills in the public sector (United Nations, 2022). Summary of Constraints Equatorial Guinea has a consistent shortage of both skilled and unskilled local labor. The shortage of digital skills is reflected in the clear mismatch between the supply and demand for digital skills. Nevertheless, the shortage could be even more prominent in the near fu- ture if no urgent measures are implemented at the national level. As the country embarks on a development path that includes the diversification of its economy, the lack of digital skills will be a critical constraint to the development of the digital economy. Given the low availability of data for Equatorial Guinea, it is not possible to report the per- centage of the population with basic, intermediate, and advanced digital skills (the latest are equivalent to Proficiency Level 5 in DigComp2.1/UNESCO Framework). Nevertheless, it seems clear that the education sector in the country is not prepared to produce a digitally skilled population at scale. This is despite a general positive attitude of the population to- wards self-learning digital skills. Basic education does not properly develop foundational 152 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC skills that are crucial for acquiring digital skills later on, the system lacks the infrastructure to teach digital skills, teachers tend not to be qualified and do not receive specific pre-ser- vice or in-service training on digital skills, opportunities for secondary education are not equal for all (especially for girls), and access to post-basic education is limited, and usually not targeted towards the acquisition of digital skills, both in the formal and informal sec- tors. Furthermore, opportunities for out-of-school children to acquire digital skills are also very limited. There is a clear mismatch between training programs and sectors conducive to economic diversification. Thus, Equatorial Guinea does not seem to be producing the digitally literate population that will be needed to diversify its economy and integrate itself into the global economy. 153 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC Box 16 UNESCO Digital Literacy Global Framework (DLGF) and DigiComp 2.0 Equatorial Guinea does not have to commence afresh to improve its policy environment for the development of digital skills. Global and regional standards and frameworks can provide a solid base. By adopting and adapting existing frameworks, countries like Equato- rial Guinea can ensure their citizens are equipped with the necessary digital skills to thrive in an increasingly digital world, fostering socio-economic development and supporting participation in the global digital economy. Reference frameworks for digital competence create an agreed vision of what is needed in terms of competences at the country level (DE4A, 2021). Two of the existing frameworks are highlighted below. The UNESCO Global Framework of Reference on Digital Literacy Skills for Indicator 4.4.2, or simply DLGF is a tool developed by the United Nations Educational, Scientific, and Cultural Organization (UNESCO) to help countries measure progress towards the fourth Sustainable Development Goal (SDG 4) on education. Specifically, Indicator 4.4.2 focuses on measuring the percentage of youth and adults who have achieved at least a minimum level of proficiency in digital literacy skills. The Framework provides a comprehensive, standardized approach to defining, assessing, and improving digital literacy. It outlines a range of competencies that individuals should possess to effectively use digital tech- nologies for communication, creativity, collaboration, and problem-solving. These com- petencies are categorized into several levels of proficiency, providing a clear roadmap for individuals to progress from basic to advanced digital literacy skills. The Framework is intended to guide education policymakers, curriculum developers, teachers, and learn- ers in integrating digital literacy into education systems and programs. The proposed DLGF builds on the European Commission’s Digital Competence Framework for Citizens (DigComp 2.0) and is based on extensive mapping of digital literacy frameworks in 47 countries and consultation with experts across the world (Law et. al., 2018). The European Digital Competence Framework, also known as DigiComp 2.0, is a tool de- veloped by the European Commission to improve citizens’ digital competence. DigiComp 2.0 identifies 21 competencies divided into five areas: Information and Data Literacy, Communication and Collaboration, Digital Content Creation, Safety, and Problem Solving. DigiComp 2.0 provides a detailed description of each competency, outlining knowledge, skills, and attitudes required. These competencies are also mapped onto proficiency lev- els, from foundation to highly specialized levels. The aim is to enable individuals to use digital technologies in a critical, collaborative, and creative way for work, learning, leisure, and participation in society. DigiComp 2.0 is intended for use by policymakers, training providers, and certification bodies to design digital literacy programs, assessment tools, and certification schemes. It provides a comprehensive and flexible framework that can be adapted to various contexts and audiences, from formal education settings to workplace training and lifelong learning. 154 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC 5.3 | DIGITAL SKILLS RECOMMENDATIONS DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION POLICY ENVIRONMENT Develop a national education ICT policy, a clear vision, and EdTech strategies: The government of Equatorial Guinea needs to establish a clear vision that recognizes the fundamental role of digital skills in modern society. The vision should articulate the kind of digital society Equatorial Guinea aspires to become and the role of digital skills in achieving this, and it should be aligned with national priorities that focus on infrastructure and connectivity. Specific objectives should be set to provide a roadmap towards achieving this vision. Equatorial Guinea’s ICT in education policies should not exist in a vacuum. They should align with and support broader national development goals and priorities. For instance, the ICT policy should demonstrate how digital skills can contribute to the economic diversification that the Growth, Equity, country aspires to reach. It should involve a variety of Inclusion, and Policy Reform Quick wins stakeholders, including educators, students, parents, and Productivity the private sector, to ensure a comprehensive evaluation of the strategies. A crucial part of the systemic approach is to focus on developing the capacity of educators and administrators. This includes training teachers to integrate digital tools into their teaching and equipping administrators with the skills to manage and support digital learning initiatives. Importantly, improving the policy environment also includes modifying laws and regulations that are outdated, such as the investment promotion law or the 1992 labor law, to highlight the importance of digital skills to create jobs. To support policy implementation, the government might want to create a digital skill working committee with participation from the relevant agencies. 155 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION Conduct a digital skills gaps assessment and approve a digital skills framework: The implementation of an assessment will help identify current gaps. The assessment could inform the design and approval of a digital skills framework to ensure that the expectations are clear for each level of education. To start, it is possible to rely on other documents already available, such as the UNESCO Global Framework, DigiComp 2.0, and frameworks adopted in other countries in the region. Equity, While all education levels are important, given the state Inclusion, and Policy Reform Quick wins of digital skills in the country, Equatorial Guinea could Productivity follow a life cycle approach, prioritizing basic digital skills at the primary and secondary levels. The country should also ensure that digital skills are part of the overall qualifications’ framework. Partnerships with private entities should be sought via MOUs or other instruments to leverage the scale and recognition of these private institutions (i.e., IBM, Microsoft, Google, Wacom…) providing access to global education programs and world-renowned certifications. STRENGTHEN CAPACITY Collect and utilize data on digital skills: Currently, there are no instruments available to understand the skills of the population. Thus, once the digital skills framework has been developed and approved, it would also be important to develop an assessment framework and evaluation instruments in order to measure digital skills across the education system. Additionally, it is important to streamline digital skills across other data collection efforts. For instance, the ongoing household survey has Growth, Equity, no questions to understand the availability of digital Medium- Inclusion, and Capacity skills and digital devices in each household. Creating a term Productivity culture of data collection and utilization is a critical step in the process of improving digital skills. By consistently gathering and analyzing data about digital literacy levels and trends, disaggregated by gender, the country can identify gaps in understanding, track progress, and adjust educational strategies as needed. Encouraging this culture means fostering an environment where data is not only collected routinely but is also respected and utilized effectively to inform decision-making processes. 156 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION EDUCATION SECTOR Ensure that teachers and students have access to teaching and learning devices and platforms: This is especially important starting in upper-secondary school. This approach could start gradually and be part of a comprehensive digital literacy plan. Devices are a window into a world of knowledge and information, they enable accessing high quality educational content and instruction that would not be available otherwise (Bold et al. 2017; Fredriksen, Brar, and Trucano 2015). However, improved learning outcomes are dependent on choosing the right technology and receiving the appropriate training and refresher workshops. The technical decisions can be guided by instruments such as the "Devices for Education Knowledge Pack" (Antunes de Carvalho, 2022). More importantly, the simple Equity, provision of devices without a broader plan has shown Investment Long-term Inclusion to be ineffective. The deployment of devices, such as the installation of computer labs, should follow a clear plan to train teachers and a clear understanding of how devices can be used as a means towards learning, rather than an end (GEAP, 2023). Thus, devices should also be accompanied by resources and platforms. This can include learning software and content that supports teaching at the right level, with a specific focus on foundational literacy and numeracy. Repositories that aggregate digital content from other platforms and sources are available, as well as learning management systems with digital materials courses for various grades and subjects. The government can build on the Escuela en Casa program and learn from the successful experience of other countries. 157 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION Prioritize foundational skills. Focusing on basic literacy, numeracy, and transferable skills is essential: Foundational skills are the building blocks to develop other skills, such as digital skills. A focus on foundational learning for all implies increasing the current rates of enrollment and developing specific programs to increase learning. Programs based on the science of learning, structured pedagogy, teacher coaching, and the use of classroom observation tools could be useful and cost-efficient (GEAP, 2023). A higher level of foundational skills will in turn increase the interest of the population in developing more advanced skills87. Moreover, Equatorial Guinea should also invest in socioemotional skills, given their growing demand by the Growth, Equity, Medium- private sector. Sometimes referred to in the literature as Inclusion, and Investments term noncognitive skills or soft skills, relate to traits covering Productivity multiple dimensions (such as social, emotional, personal, behavioral, and attitudinal). These skills involve self- awareness, self-regulation, empathy, and social skills. Socioemotional skills are essential for personal and social development, as they influence how individuals interact with others and navigate the world around them (World Bank, 2014). All these measures should be implemented with a gender lens to reduce the current prevalence of gender discrimination. This is important not only for primary schools, but also for secondary (where removing the constraints for pregnant girls to attend school would represent an improvement) and post-secondary. It is also worth considering that there are evidence-based ways to develop foundational skills while also developing 87   digital skills, such as through the use of adaptive learning programs. 158 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION EXPAND ACCESS TO DIGITAL SKILLS Scale up the availability of digital skills courses for public sector employees in order to expand digital government services: The country could leverage the existence of CNIAPGE and INAP to offer government workers opportunities to acquire digital skills following a structured plan and with the end goal of expanding the digital government. However, both the structure and the capacity of these two organizations need to be revamped in order to develop the capacity to provide high-quality training at scale. This entails investing in better human resources, more infrastructure, and more solid institutional arrangements to ensure interoperability. This should be coupled with a plan to create an enabling environment for the private provision of digital skills programs. At the current rate, the government will not be able to address the digital skills shortage relying purely on public provision of programs. Thus, it would be important to foster the emergence of Growth, Equity, Medium- private programs and other initiatives promoted by civil Inclusion, and Investment term society organizations. These programs must adhere to Productivity the skills framework and could follow the assessment frameworks that need to be developed. The government could curate a centralized database of programs and facilitate the information to those who are interested. Existing initiatives such as IDENTIC and its CET program, the BANGE Business School, and others should be leveraged. Public-private partnerships are also an option that has been successful in other low-income settings88. Thus, increasing partnerships with the private sector could present many opportunities. The government should sign memorandums of understanding with relevant private sector entities to deliver digital skills in person and, to the extent possible, online. Importantly, the enabling environment should also incentivize the provision of digital skills for those who are out-of- school, which represent a significant portion of children and youth in the country. In Edo State, Nigeria, alliances between the public and the private sector have been able to train more than 18,000 88   youth in two years, as part of the Edo State Skills Development Agency work. 159 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION INFRASTRUCTURE Deploy a connectivity plan which includes schools both in urban centers and in rural or remote areas: The first step towards this goal is to undertake an exhaustive assessment of the current situation. It is crucial to recognize that the challenges and opportunities faced by urban schools may differ significantly from those in rural or remote areas. The plan should consider factors such as the existing infrastructure, demographic characteristics, and specific needs of each area. It is equally necessary to define clear and feasible targets for internet connectivity. Growth, Equity, The target should be high enough to enable effective Inclusion, and Investment Long term digital learning, but also realistic considering the current Productivity infrastructure and resources. A successful connectivity plan should not only focus on the short-term goal of connecting schools but also consider the long-term sustainability and scalability of the initiative. Equatorial Guinea can learn from the experiences of other countries. For instance, Mozambique aims to integrate the national institutions of higher education, professional technical education, and research into a national high-speed data communication network. It has already integrated more than 160 institutions (Morenet, 2022). 160 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC @ alarico / Shutterstock 161 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC CONCLUSIONS CROSS-CUTTING PRIORITIES AND A WAY FORWARD The following cross-cutting priorities have been identified: Priority 1: Improve institutional coordination; Priority 2: Improve access to electricity; Priority 3: Address regulatory gaps and strengthen government capacity to close gaps in access to digital infrastructure and digital services and address affordability to boost demand; Priority 4: Improve data quality, coverage, and usage; Priority 5: Reduce the gender gap and the island-continental digital divide and enhance regional and Pan African integration. The Government of Equatorial Guinea is cognizant of the country’s need to embrace the diversification of its economy, and the digital economy is a powerful candidate to become the country’s “new oil.” The digital economy can become a key driver of economic growth, innovation and prosperity, and an essential element in Equatorial Guinea’s resilience to fu- ture shocks. However, much remains to be accomplished to allow the country to keep pace with the regional and global trend and fully leverage the potential of digital technologies to accelerate inclusive socioeconomic growth. While there are multiple operators in the broadband sector, an inadequate regulator, and outdated legislation have paved the way for a quasi-monopolistic market. This scenario has prevented market competition and sufficient private sector investment, and in conse- quence, high prices and low broadband penetration rates have arisen. The recent efforts to reduce prices are in the right direction. However, until the regulator and legislation are revamped, the market will not experience major changes. A holistic whole-of-government approach is necessary to create an enabling environment for the digital economy. An overarching, whole-of-government national strategy that pro- vides a high-level vision and objectives for the digital economy and digital transformation will help the GoEG shift away from fragmented and siloed interventions, such as CNIAPGE’s unsuccessful objective of becoming the one-stop-shop for digital public platform solutions. Institutional coordination and collaboration should also be strengthened, with clear articu- 162 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC lation of the mandates and responsibilities of relevant MDAs to ensure far-reaching impact of digital transformation in Equatorial Guinea. Ongoing efforts to leverage digital platforms in the public sector are largely fragmented across various departments and agencies. The use of digital public platforms will become more effective and efficient by ensuring greater interoperability and focusing on shared services. Improved institutional coordination is needed to ensure the full implementation of the current strategy through CNIAPGE, or an equivalent instrument, which allows the Government to deploy the whole-of-government approach. The development and adoption of DFS in Equatorial Guinea is still at its embryonic stages, with less than half of the banks offering mobile banking solutions, and no mobile money operator active in the country. The full-fledged development of the DFS ecosystem would require strengthened institutional cooperation, particularly among regulators, including a national financial education strategy, effective oversight and supervision by the Central Bank, and interoperability across various payment service providers. Equatorial Guinea has not yet effectively promoted digital technologies and businesses and there is a lack of support for entrepreneurs and startups. Outdated regulation and infrastructure on access to finance; mismatch between supply and demand of digital skills or a weak regulatory framework are the main barriers affecting digital businesses and startups in the country. Under these circumstances, there is room for greater public and private sector collaboration to scale up digital entrepreneurship support and increase access to finance. The lack of digital skills among the general population and the public sector, currently presents a bottleneck for the development of the digital economy in Equatorial Guinea. Despite the expansion of access to education in the last couple of decades in the country, the education sector is not prepared to produce a digitally skilled population at scale. This is due to basic education not properly developing foundational STEM skills, the system experiencing a dearth of infrastructure to teach digital skills (i.e., electricity, computers, internet), teachers requiring additional skills and specific training on digital skills or ICT not being included in the education curriculum. Beyond the basic education sector, the challenges persist. Finally, the country must reduce the island-continental divide and enhance regional and Pan African integration. The latter is key for a small country, like Equatorial Guinea, with a narrow domestic market. The technological nature of the digital economy opens the door to a global market, with job opportunities from around the globe available from Equatorial Guinea (i.e. the gig economy), potential clients for locally developed solutions available for a 163 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC global audience (i.e. apps available in Android or Apple marketplaces), or affordable state of the art training and skills development programs available online (i.e. Massive Open Online Courses – MOOCs). These are some examples of how the digital economy may become a cornerstone in Equatorial Guinea’s strategy to diversify the country’s economy and reduce its dependency on extractive industries. Equatorial Guinea has an opportunity to leverage its strengths and take advantage of the benefits the digital economy has to offer, by creating incentives for investment and innovation, and further reforming the regulatory framework for accelerated growth. 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Retrieved from Equatorial Guinea Country Overview: https://www.worldbank.org/en/country/equatorialguinea/overview. 170 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC ANNEX 1 Summary of Recommendations DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION DIGITAL INFRASTRUCTURE FIRST MILE: INTERNATIONAL CONNECTIVITY Increase Redundancy: The lack of sufficient redundancy Medium on international bandwidth must be resolved by joining an Resilience Investment term additional major international submarine cable. Reduce prices on international capacity services: To reduce prices on international capacity services, the international capacity wholesale market must be declared a relevant Growth Policy reform Quick win market and be regulated in a cost-oriented way following a proper market study. MIDDLE MILE: NATIONAL BACKBONE NETWORK Strengthen the National network backbone fiber wholesale market: Launch a market study that will potentially identify the national network fiber wholesale market as a relevant Growth Policy reform Quick win market and apply cost-oriented obligation to the significant market players. Reduce microwave spectrum fees: More than 90 percent of the sites are on microwave. To lower costs of operation, Medium Growth Policy reform microwave spectrum fees must be lowered by aligning them term with international/regional benchmarks. LAST MILE: ACCESS NETWORKS Increase coverage in rural areas: Coverage in rural areas can be improved by putting in place incentives for mobile operators to invest in areas that are not economically viable, using the Universal Service Fund (USF) and government subsidies. Infrastructure sharing obligation also helps a lot as well when it comes to covering the underserved or Medium Growth Policy reform unserved areas. term This recommendation must be developed jointly with the Digital Skills recommendation that will focus on deploying a connectivity plan which includes schools both in urban centers and in rural or remote areas (Please see Digital Skills recommendations in the respective chapter). 171 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION Address the usage gap: Mitigate the usage gap (population already covered by a 3G/4G) but not using internet) by Medium Growth Policy reform improving digital literacy, reducing taxes on digital services term and on smartphone acquisition costs. INVISIBLE MILE: SECTOR POLICIES AND REGULATIONS Review the telecom law: A review of the 2005 telecom law will allow the creation of separate and financially independent regulatory authority with all necessary power to regulate the market efficiently must be created and an Medium update of the spectrum management framework to onboard Productivity Policy reform term best practices like refarming and finalize the migration of terrestrial TV from analog to digital and then allocate the digital dividend frequencies (700 and 800) to mobile operators at a reasonable cost. Perform a cybersecurity maturity assessment: Conduct a cybersecurity maturity assessment with the aim of obtaining a clear overview of the current state of cybersecurity in the country and to identify the areas that need to be Productivity Policy reform Quick Win strengthened and developed so that Equatorial Guinea can become a digitally secure nation. These findings would be used to inform development of a national cybersecurity strategy and action plan. Strengthen the legal and regulatory framework for cybersecurity: Create a legal and regulatory cybersecurity Medium and cybercrime framework by preparing and adopting Productivity Policy reform term necessary bills and applicative decree. Sign the cybercrime and personal data AU Malabo Convention. DIGITAL PUBLIC PLARFORMS LEGAL, POLICY, AND REGULATORY FRAMEWORK Strengthen Legislative and Regulatory Framework: Many of Equatorial Guinea’s public administration laws are outdated and no longer adequate for a modern public administration which uses digital tools and platforms to operate. In some cases, extant laws require additional legislation to be effectively implemented (i.e., Personal data protection law without a corresponding cybersecurity law). A legal Equity, Policy Medium- foundation can provide the necessary impetus towards Inclusion Reforms Term reforms. Monitoring of existing laws helps to ensure that the regulatory framework envisioned by the new laws is actually being adhered to and that new policies adapted to digital solutions are being implemented. While this recommendation takes time it is highly advisable that it be given particular priority as it underpins the entire reform process. 172 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION GOVERNMENT STRATEGY Development of a national Strategy for digital public platforms: The government may build on the existing strategies such as ADIGE and UNDP’s e-government strategies and ensure that existing gaps such as data- management, interoperability, citizen-centric public platforms and other relevant themes are also addressed. This could be achieved by an expansion of these existing Policy strategies or the creation of a stand-alone e-governance Productivity Quick-Win Reforms strategy. The national strategy should be aligned with the country’s overarching development agenda and provide tangible and feasible goals within a defined time horizon. It could be embedded in the “Agenda Guinea Equatorial 2035” or published independently. Digital public platforms can help enhance public service delivery, transparency, and citizen engagement and any strategy should be user-centered. Establish data governance by increasing data availability, collection and analysis to improve policy making and create good governance. Developing a data framework can help lay the foundation for improved data governance. It helps to delineate the kind of data that the public administration is to collect from core government systems, Equity, Policy Long Term how to protect the data from unwanted access, it identifies Inclusion Reforms responsibilities and standardizes data collection procedures across all government branches. The data framework should be aligned with the national strategy for digital public platforms and the legal framework surrounding the collection and use of data by public officials. LEADERSHIP AND INSTITUTIONAL READINESS Strengthening the digital skills capacity of the public sector: Several public entities independently stated that lack of qualified human resources was a serious impediment to introduce digital public platforms. To this end the government should establish a methodology to evaluate and monitor the skillset of the public sector’s digital skills. This would (i) establish a baseline of the public servants’ Medium- Productivity Capacity skillset, which is necessary to properly develop a digital Term skills policy and program aimed at re- and up-skilling them, and (ii) monitor their progress to determine whether new courses and programming are achieving impact (and course correct as need be). The methodology should be developed in collaboration with the relevant agencies and include INAP and CNIAPGE. 173 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION Re-evaluate the role and function of CNIAPGE: The national center for the digitization of the public administration in Equatorial Guinea clearly plays a crucial role in driving forward reforms, but it is also over-extended in terms of its responsibilities and lacks the political power to drive greater coordination between different ministries and strengthen Productivity Policy Reform Quick-Win a much desired whole-of-government approach. The government may wish to re-evaluate the Centers strengths and mandate and how its vertical structures can be improved with horizontal inter-ministerial coordination. Any such reorientation should be well embedded in the overall digital strategy the government wishes to pursue. DIGITAL IDENTIFICATION (ID) AND TRUST SERVICES Fully digitalize the civil registry, to improve the accessibility, verifiability, and quality of data: With the pilot of the digital civil registry in Malabo, the first steps for the expansion of the digitalization of the civil registry was laid. Building on the experiences from the capital, civil registration should be digitalized nationwide. By enabling Medium- digital data entry and establishing a digital database (or Equity Inclusion Investment Term interconnected databases) of civil registration records that can support secure, electronic data exchange, the trust in and accuracy of other databases relying on identity data such as CNEDOGE and INSESO would be strengthened. Remaining gaps in the completeness and timeliness of civil registration should be addressed as well. Increase the accessibility and digital capabilities of the National ID system: A trusted and inclusive identification system that enables unique identification and digital authentication (and is aligned with the Principles on Identification for Sustainable Development) can improve effective service delivery across multiple sectors. Among others, it can serve as a core enabler for the development of a national social registry, including: (a) accurate identification and registration to avoid ghost records and Equity Inclusion Medium- duplications in social registries or data basis of beneficiaries; Investment Productivity Term (b) interoperability between social registry and other beneficiaries or administrative registries to allow for both rapid selection and enrollment but also for automatic cross checks and frequent updating of data as opposed to more prevalent census type of data collection requiring face to face visit to households; and (c) enable electronic payments through more streamlined account opening and verification processes (Gov to People, People to People, People paying for goods and services using Point of Sales/POSs). 174 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION INTEROPERABILITY Achieve greater interoperability between digital public platforms (whole-of-government approach) by introducing an interoperability framework and a subsequent interoperability platform or data exchange layer. This framework specifies a set of tailored common, government- wide principles, standards, and practices that all government agencies should adopt and utilize for the purposes of joint Medium- Productivity Investment delivery of public services. Such a framework consists of Term four layers: legal, organizational, semantic, and technical interoperability. The ability to link administrative databases using unique identifiers has been a key factor in allowing countries to respond quickly and effectively to service delivery challenges for instance during emergencies, such as natural disasters. DIGITAL FINANCIAL SERVICES POLICY AND REGULATION: OVERALL Develop a national financial inclusion strategy: Design, finalize, and adopt a national financial inclusion strategy with a focus on the development of DFS (in line with the regional financial inclusion strategy and the national diagnostic on financial inclusion). The national financial inclusion strategy should also include the following components: •  A comprehensive national survey of demand for financial services to better assess financial inclusion challenges and to guide the development of relevant policy responses to tackle identified barriers and gaps. •  A national financial education strategy (in line with BEAC’s financial education-related projects) to enhance the financial capability and resilience as well as Medium- financial health of vulnerable groups in Equatorial Inclusion Policy Reform term Guinea. •  A data collection strategy on key financial inclusion- related metrics, including the collection of data on the geographic location of the different access points. •  A strategy for the collection and analysis of sex- disaggregated data on relevant financial inclusion related metrics, and the inclusion of sex-disaggregated data collection in the reporting requirements of financial institutions. •  A roadmap for the digitalization of persons to government (P2G) and government to persons (G2P) payments (such as civil servant salaries and social protection programs) to encourage wider adoption of DFS. 175 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION MARKET DEVELOPMENT Improve key DFS enablers from a market perspective and foster industry collaboration (e.g., by strengthening/ establishing e-commerce platforms, cybersecurity platforms, Investment/ Growth Long-Term crowdfunding platforms, etc.) and by developing an enabling Policy Reform environment for fintech development at national level including a fintech innovation hub. POLICY AND REGULATION: DELIVERY CHANNEL & PRODUCT INNOVATION Assess the need to expand and strengthen agent networks Equity/ Investment Quick win to foster DFS adoption, especially in remote areas. Inclusion POLICY AND REGULATION: MANAGING RISKS OF DIGITAL FINANCE Design and implement capacity building programs and activities: For the CNEF of Equatorial Guinea, to build capacity in • its newly acquired responsibilities for the protection of financial consumers (i.e., in the areas of mediation and the Equity/ Medium- design of a data infrastructure to support the processing, Investment Inclusion term monitoring and analysis of cases). For financial Service Providers, to build the capacity in the • management of internal dispute resolution mechanisms as well as in the collection and use of data to develop DFS suited to the needs of vulnerable groups. DIGITAL BUSINESSES GENERAL POLICY ENVIRONMENT AND COORDINATION Articulate a roadmap to support digital entrepreneurship and productive use of digital technologies: The new Digital Agenda offers an opportunity to develop a roadmap with a clear definition of roles, resources, and objectives for different government entities as well as specific targets and monitoring framework for the implementation of actions to support digital business. Clarifying the leading institution to monitor the implementation of the digital Investment and agenda, particularly on actions related to digital business, Growth Quick win policy reform will help to ensure more effective government interventions in the sector. Having a strong leading institution to facilitate collaboration with private sector, academia, civil organizations as well as interinstitutional coordination is essential to ensure improvements across other pillars of the digital economy - digital infrastructure, digital finance (payments), digital skills - that provide the enabling environment for the growth of digital businesses. 176 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION Promote public-private dialogue in the area of digital businesses: Given the changing nature of digital technologies and the variety of business models, it is vital to maintain public-private dialogue to inform policy implementation, design of regulatory instruments and measures to enhance effectiveness of support programs. Therefore, designating a representative from the public Growth Capacity Quick win sector, such as the Ministry of Commerce, and giving voice to various private sector associations, such as EMEG, is crucial. This enables the exchange of insights and ensures that the strategy and its implementation remain aligned with the sector’s needs, this contributes to the design of more effective policies and provides a much faster maneuvering space that enables quick adaptation to market needs. ENABLING DIGITAL REGULATORY ENVIRONMENT Develop regulatory and policy reforms that consider the intrinsic nature of digital entrepreneurship: Equatorial Guinea should build on the progress made on the VUE and further enhance general business regulations and implementation for business registration taking into consideration the nature of digital business including in relation to capital requirements and categories of business activities, among others. Reforms to facilitate paying taxes and access to credit are essential, as well as rules related to visas and work permits to enable access to a larger pool of human resources. Frameworks to promote foreign direct investment and private investment in general would Medium further support the expansion of digital business. In order to Growth Policy reform term enhance regulatory frameworks for business development, the following actions should be prioritized: (i) ensure the implementation and enforcement of the OHADA commercial law, with a particular focus on ensuring accessibility (translating them to Spanish and publishing laws, regulations and procedures); (ii) create effective enforcement mechanisms, a clear judicial career and a specialized commercial court to ensure compliance with the existing legal framework and proper dispute resolutions mechanisms, and (iii) update and maintain the BOE (Boletin Oficial del Estado) providing easy and free access to the country legal framework. 177 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION Focus on developing essential digital market regulations and effective institutions to create digital trust and boost digital technology adoption and innovation: It is necessary to address notable gaps in legislation covering areas such as online consumer protection, online supplier protection, intellectual property rights, data protection and privacy, regulations related to data use, sharing and reuse, e-signature, e-commerce, and e-procurement. Inclusion and Policy reform Long term Additionally, clear guidelines are needed for accessing Productivity and sharing information, and effective mechanisms to ensure cybersecurity and combat cybercrime. For example, Equatorial Guinea could adopt international standards for cyber security and data protection to facilitate cross-border digital trade, and in line with the African Union Data Policy Framework. Furthermore, reforms to tackle absence of an addressing system will alleviate constraints on e-commerce. DIGITAL TECHNOLOGY ADOPTION AND DEMAND FOR DIGITAL BUSINESS SERVICES Promote digital technology adoption as part of the diversification and economic transformation agenda: Digitalization of primary sectors - agriculture, fishing, and forestry can lead to transformative change and at the same time create demand for digital solutions by domestic entrepreneurs. Digital technologies offer opportunities to improve productivity and efficiency through tools such as precision farming, IoT (Internet of Things) devices and data analytics. Digital technologies can also be used for more efficient monitoring and exploitation of fishing and forestry resources to ensure sustainability. State-owned enterprises could support adoption of digital technologies in their operations and generate spillover effects across their value chains. Enhancing the statistical capacity of INEGE Medium Growth Policy reform and VUE’s data collection strategy, along with the creation term of a consolidated database of information publicly available from different offices. This will enable the monitoring of the digital business ecosystem and the policy alignment with the needs of the private sector landscape - both digital sector and sectors with potential to adopt digital technologies. Based on these insights, tailored policies and support programs could be formulated. Moreover, aggregated business census data can be used by digital businesses to estimate market size for their services and innovations. Support to MSME for the adoption of digital technologies through finance, capacity building and integration across value chains and access to export markets through digital technologies should be considered 178 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION Consider public procurement as a source of demand for digital services: Public procurement of ICT services can support the development of a local digital ecosystems and facilitate technology transfer through partnerships involving Growth Policy reform Long term local and foreign suppliers. This can also further support the adoption of data protection and cybersecurity standards by suppliers. VIBRANT, COHESIVE AND INCLUSIVE DIGITAL ECOSYSTEM Promote the development of an inclusive digital entrepreneurship ecosystem: The system to support the digital innovation system -entrepreneurship support organizations, incubators, and accelerators, such as EMEG, Identic and Dreams Hub (to accompany entrepreneurs locally and across the diaspora) - could be enhanced through greater coordination, transparency, and monitoring of the dynamics of the startup and incubator ecosystem. The government could undertake a proactive approach to promote and highlight the achievements and contributions of startups and incubators through various means, such as organizing events, launching awareness campaigns, and creating online platforms that showcase success stories and provide resources for aspiring entrepreneurs. Increasing access to information on the services provided to support entrepreneurs, including requisites to access grant programs, is essential for greater participation of diverse entrepreneurs. To support female entrepreneurs, entrepreneurship support programs should consider women- Productivity Policy reform Quick win specific needs and challenges. and Inclusion To complement these efforts, fostering collaboration between universities, schools, and the private sector is crucial. Aligning education with market demands ensures graduates possess relevant skills and knowledge. By establishing strong partnerships, educational institutions can adapt curricula and programs to evolving private sector needs, incorporating needs assessments and offering work- integrated learning like internships and industry placements. Based on an in-depth analysis of digital entrepreneurs’ bottlenecks, market failures and government failures, start up support programs can be designed considering the appropriateness of the instrument, proportionality of the benefits provided, expected direct and indirect effects (e.g., on markets, fiscal accounts), and availability of adequate governance mechanism (transparency, monitoring and evaluation). This could include seed funds, partial credit guarantees and matching grants, among others. 179 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION DIGITAL SKILLS POLICY ENVIRONMENT Develop a national education ICT policy, a clear vision, and EdTech strategies: The government of Equatorial Guinea needs to establish a clear vision that recognizes the fundamental role of digital skills in modern society. The vision should articulate the kind of digital society Equatorial Guinea aspires to become and the role of digital skills in achieving this, and it should be aligned with national priorities that focus on infrastructure and connectivity. Specific objectives should be set to provide a roadmap towards achieving this vision. Equatorial Guinea’s ICT in education policies should not exist in a vacuum. They should align with and support broader national development goals and priorities. For instance, the ICT policy should demonstrate how digital skills can contribute Growth, Equity, to the economic diversification that the country aspires to Inclusion, and Policy Reform Quick wins reach. It should involve a variety of stakeholders, including Productivity educators, students, parents, and the private sector, to ensure a comprehensive evaluation of the strategies. A crucial part of the systemic approach is to focus on developing the capacity of educators and administrators. This includes training teachers to integrate digital tools into their teaching and equipping administrators with the skills to manage and support digital learning initiatives. Importantly, improving the policy environment also includes modifying laws and regulations that are outdated, such as the investment promotion law or the 1992 labor law, to highlight the importance of digital skills to create jobs. To support policy implementation, the government might want to create a digital skill working committee with participation from the relevant agencies. 180 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION Conduct a digital skills gaps assessment and approve a digital skills framework: The implementation of an assessment will help identify current gaps. The assessment could inform the design and approval of a digital skills framework to ensure that the expectations are clear for each level of education. To start, it is possible to rely on other documents already available, such as the UNESCO Global Framework, DigiComp 2.0, and frameworks adopted in other countries in the region. While all education levels Equity, are important, given the state of digital skills in the country, Inclusion, and Policy Reform Quick wins Equatorial Guinea could follow a life cycle approach, Productivity prioritizing basic digital skills at the primary and secondary levels. The country should also ensure that digital skills are part of the overall qualifications’ framework. Partnerships with private entities should be sought via MOUs or other instruments to leverage the scale and recognition of these private institutions (i.e., IBM, Microsoft, Google, Wacom…) providing access to global education programs and world- renowned certifications. STRENGTHEN CAPACITY Collect and utilize data on digital skills: Currently, there are no instruments available to understand the skills of the population. Thus, once the digital skills framework has been developed and approved, it would also be important to develop an assessment framework and evaluation instruments in order to measure digital skills across the education system. Additionally, it is important to streamline digital skills across other data collection efforts. For instance, the ongoing household survey has no questions Growth, Equity, to understand the availability of digital skills and digital Medium- Inclusion, and Capacity devices in each household. Creating a culture of data term Productivity collection and utilization is a critical step in the process of improving digital skills. By consistently gathering and analyzing data about digital literacy levels and trends, disaggregated by gender, the country can identify gaps in understanding, track progress, and adjust educational strategies as needed. Encouraging this culture means fostering an environment where data is not only collected routinely but is also respected and utilized effectively to inform decision-making processes. 181 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION EDUCATION SECTOR Ensure that teachers and students have access to teaching and learning devices and platforms: This is especially important starting in upper-secondary school. This approach could start gradually and be part of a comprehensive digital literacy plan. Devices are a window into a world of knowledge and information, they enable accessing high quality educational content and instruction that would not be available otherwise (Bold et al. 2017; Fredriksen, Brar, and Trucano 2015). However, improved learning outcomes are dependent on choosing the right technology and receiving the appropriate training and refresher workshops. The technical decisions can be guided by instruments such as the “Devices for Education Knowledge Pack” (Antunes de Carvalho, 2022). More importantly, the simple provision of Equity, devices without a broader plan has shown to be ineffective. Investment Long-term Inclusion The deployment of devices, such as the installation of computer labs, should follow a clear plan to train teachers and a clear understanding of how devices can be used as a means towards learning, rather than an end (GEAP, 2023). Thus, devices should also be accompanied by resources and platforms. This can include learning software and content that supports teaching at the right level, with a specific focus on foundational literacy and numeracy. Repositories that aggregate digital content from other platforms and sources are available, as well as learning management systems with digital materials courses for various grades and subjects. The government can build on the Escuela en Casa program and learn from the successful experience of other countries. 182 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION Prioritize foundational skills. Focusing on basic literacy, numeracy, and transferable skills is essential: Foundational skills are the building blocks to develop other skills, such as digital skills. A focus on foundational learning for all implies increasing the current rates of enrollment and developing specific programs to increase learning. Programs based on the science of learning, structured pedagogy, teacher coaching, and the use of classroom observation tools could be useful and cost-efficient (GEAP, 2023). A higher level of foundational skills will in turn increase the interest of the population in developing more advanced skills89. Moreover, Equatorial Guinea should also invest in socioemotional skills, given their growing demand by the private sector. Growth, Equity, Medium- Sometimes referred to in the literature as noncognitive Inclusion, and Investments term skills or soft skills, relate to traits covering multiple Productivity dimensions (such as social, emotional, personal, behavioral, and attitudinal). These skills involve self-awareness, self-regulation, empathy, and social skills. Socioemotional skills are essential for personal and social development, as they influence how individuals interact with others and navigate the world around them (World Bank, 2014). All these measures should be implemented with a gender lens to reduce the current prevalence of gender discrimination. This is important not only for primary schools, but also for secondary (where removing the constraints for pregnant girls to attend school would represent an improvement) and post-secondary. It is also worth considering that there are evidence-based ways to develop foundational skills while also developing 89   digital skills, such as through the use of adaptive learning programs. 183 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION EXPAND ACCESS TO DIGITAL SKILLS Scale up the availability of digital skills courses for public sector employees in order to expand digital government services: The country could leverage the existence of CNIAPGE and INAP to offer government workers opportunities to acquire digital skills following a structured plan and with the end goal of expanding the digital government. However, both the structure and the capacity of these two organizations need to be revamped in order to develop the capacity to provide high-quality training at scale. This entails investing in better human resources, more infrastructure, and more solid institutional arrangements to ensure interoperability. This should be coupled with a plan to create an enabling environment for the private provision of digital skills programs. At the current rate, the government will not be able to address the digital skills shortage relying purely on public provision of programs. Thus, it would be important to foster the Growth, Equity, Medium- emergence of private programs and other initiatives Inclusion, and Investment term promoted by civil society organizations. These programs Productivity must adhere to the skills framework and could follow the assessment frameworks that need to be developed. The government could curate a centralized database of programs and facilitate the information to those who are interested. Existing initiatives such as IDENTIC and its CET program, the BANGE Business School, and others should be leveraged. Public-private partnerships are also an option that has been successful in other low-income settings90. Thus, increasing partnerships with the private sector could present many opportunities. The government should sign memorandums of understanding with relevant private sector entities to deliver digital skills in person and, to the extent possible, online. Importantly, the enabling environment should also incentivize the provision of digital skills for those who are out-of-school, which represent a significant portion of children and youth in the country. In Edo State, Nigeria, alliances between the public and the private sector have been able to train more than 18,000 90   youth in two years, as part of the Edo State Skills Development Agency work. 184 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC DEVELOPMENT TYPE OF RECOMMENDATION TIMEFRAME OUTCOME INTERVENTION INFRASTRUCTURE Deploy a connectivity plan which includes schools both in urban centers and in rural or remote areas: The first step towards this goal is to undertake an exhaustive assessment of the current situation. It is crucial to recognize that the challenges and opportunities faced by urban schools may differ significantly from those in rural or remote areas. The plan should consider factors such as the existing infrastructure, demographic characteristics, and specific needs of each area. It is equally necessary to define clear and feasible targets for internet connectivity. The target should Growth, Equity, be high enough to enable effective digital learning, but also Inclusion, and Investment Long term realistic considering the current infrastructure and resources. Productivity A successful connectivity plan should not only focus on the short-term goal of connecting schools but also consider the long-term sustainability and scalability of the initiative. Equatorial Guinea can learn from the experiences of other countries. For instance, Mozambique aims to integrate the national institutions of higher education, professional technical education, and research into a national high-speed data communication network. It has already integrated more than 160 institutions (Morenet, 2022). 185 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC ANNEX 2 High-Level Targets of the DE4A Initiative ALIGNMENT WITH THE WORLD BANK INTERIM FINAL PILLAR GOAL INDICATOR AND GLOBAL BASELINE TARGET TARGET DEVELOPMENT (2021) (2030) AGENDA Enable every African Individuals using individual, IDA19 the Internet per 100 SDG OVERALL business, and (JET, GD, 26.37 35 75 inhabitants (by IDA, 17.8.1 government to GI) FCV) participate in the Digital Economy “Unique” mobile- SDG 1.1 Increase broadband 1.4.1 access to IDA19 subscriptions per 100 SDG 25 32 67 broadband (JET, GI) inhabitants (by IDA, 9.c.1 Internet FCV) AU 2063 1.2 Increase Average mobile quality of broadband download SDG 2.6 2 11 broadband speed (Mbit/s) (by IDA, 17.6 Mbps Mbps Mbps DIGITAL Internet FCV) INFRASTRUCTURE Average price of 1GB 1.3 Increase mobile data price per affordability month (% of a country’s 7.77 2 of broadband average monthly GNI Internet per capita) (by IDA, FCV) 2.1 Increase availability and adoption Digital Adoption Index of secured and IDA19 (DAI) (Government 0.41 0.45 0.80 interoperable (GI) cluster) (by IDA, FCV) digital platforms for public services DIGITAL PUBLIC Percent of the 15+ PLATFORMS population with an 2.2 % ID coverage SDG officially recognized 66% 70% 100% for adults 16.9 identity credential (i.e., a “foundational” ID) 186 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC ALIGNMENT WITH THE WORLD BANK INTERIM FINAL PILLAR GOAL INDICATOR AND GLOBAL BASELINE TARGET TARGET DEVELOPMENT (2021) (2030) AGENDA Percentage of adults 3.1 Increase with access to a access to transaction account (by SDG IDA19 41% 50% 90% digital financial gender, income group, 8.10.2 (JET) services education level, urban/ rural; and by IDA, FCV) Percentage of adults DIGITAL who made a digital FINANCIAL 3.2 Increase retail payment in the SERVICES usage of digital past year SDG 27% 50% 90% financial (by gender, income 10.c.1 services group, education level, urban/rural; and by IDA, FCV) Number of IT startup firms with HQ in Africa graduating from Incubator/Accelerator programs and/or 4.1 Increase in receiving private SDG IDA19 the number of funding from Angel, 198 240 600 9.3.2 (JET) digital start-ups Early-Stage VC, Product Crowdfunding or, Seed round (by size of firm, female vs male ownership; and by IDA, FCV) DIGITAL Number of new digital BUSINESSES business model firms, including all stages 4.2 Increase in of digital businesses the number of as long as they are platform-based IDA19 platform-based or using 73 90 220 or data-driven (JET) data as a key input to firms operating create value (by local in the country vs. foreign, founding year, size of firm; and by IDA, FCV) 187 Equatorial  Guinea  D IGITAL ECONOMY DIAGNOSTIC ALIGNMENT WITH THE WORLD BANK INTERIM FINAL PILLAR GOAL INDICATOR AND GLOBAL BASELINE TARGET TARGET DEVELOPMENT (2021) (2030) AGENDA Percentage of lower- 5.1 Increase secondary schools with Internet access to internet for SDG connectivity 35% 55% 100% pedagogical purposes 4.a.1 in education (by urban/rural; and by institutions IDA, FCV) DIGITAL 5.2 Increase Proportion of youth and SKILLS availability adults with advanced IDA19 SDG of digitally digital skills (JET and 2% 3% 6% 4.4.1 competent (by gender, urban/rural; GI) workforce and by IDA, FCV) 188