Canalys: Africa's smartphone market will grow by 9% in 2024, Transsion leads in both fourth quarter and full year.

Canalys' latest data shows that the shipment of smartphones in Africa is expected to increase by 9% in 2024 compared to the previous year, demonstrating market resilience amidst global economic fluctuations. This recovery is mainly driven by inflation easing (increasing consumer purchasing power), manufacturers accelerating expansion into emerging markets, and the replacement cycle driven by the peak in shipments during the pandemic in 2021. The African smartphone market reached a historical high of 90.5 million shipments in 2021, which has yet to be exceeded. Looking ahead, the African market has vast growth potential and long-term opportunities. However, the region is expected to face short-term macroeconomic pressures in 2025, including ongoing high inflation, currency devaluation risks, and limited economic growth momentum. Canalys predicts that the African smartphone market will achieve a moderate growth of 2% in 2025. The African market presents different opportunities and challenges under policy adjustments and price pressures. In the fourth quarter of 2024, the smartphone market in Nigeria decreased by 1% year-on-year, maintaining a regional market share of 14%. Despite stimulating some demand during the holiday season, rising living costs offset this growth. Looking ahead to 2025, the market may face even greater challenges, as telecom operators plan to raise tariffs by 100%, which could dampen demand as consumers may reduce spending under higher data costs. Egypt achieved growth for the fourth consecutive quarter, with a 12% year-on-year increase in Q4, mainly benefiting from a stable fiscal environment. Starting in January 2025, Egypt imposed a maximum 38.5% import tax on mobile phones to promote local manufacturing and strengthen import management, further highlighting the need to develop local production capacity. Algeria benefited from economic reforms post-2020, with a growth of 11% in the smartphone market in the fourth quarter of 2024. In contrast, the market in Morocco faced pressure due to a significant 34% decrease in shipments in Q4, caused by the customs tariff adjustment implemented earlier in 2024. This tariff adjustment raised the end-user prices, suppressed consumer spending, extended the replacement cycle, and posed challenges for manufacturers. The Kenyan market declined by 4% in Q4, mainly due to the impact of a new regulation effective in November, which required devices to undergo tax compliance verification before accessing the local network. This policy increased operating costs for manufacturers and temporarily suppressed shipments. South Africa's market declined slightly by 1% in Q4 but showed signs of recovery from the double-digit decline in the previous quarter. Improvements in the economic environment, lower interest rates, and enhanced consumer confidence are driving the market towards gradual recovery. Canalys Senior Analyst Manish Pravinkumar stated, "In the fourth quarter of 2024, the segment below $100 saw a 49% year-on-year growth, highlighting the increasing economic pressure consumers face. Despite maintaining a leading market share of 49%, Transsion only saw a marginal 1% year-on-year growth in the face of intense competition. The brand is expanding into new product categories, including home appliances, but these businesses have not yet made a significant contribution to its overall revenue. Samsung saw a 17% year-on-year decline in shipments in Q4, but its Average Selling Price (ASP) increased by 9% to reach $240, placing it at the top among Android brands. Samsung is focusing on strengthening the mid-to-high-end market of $200 to $600, targeting African urban middle-class consumers who aspire to have 'status symbol' smartphones." Pravinkumar added, "realme achieved 70% year-on-year growth in the fourth quarter of 2024, mainly driven by its expansion in North Africa and East Africa markets, as well as the momentum of its Note series last year. OPPO increased its investment in local production in Egypt and Turkey in 2024, demonstrating its long-term commitment to the African market." The market is expected to achieve single-digit growth in 2025, with a vibrant future business environment. Canalys predicts that the African market will grow by 2% in 2025, despite facing economic challenges. According to forecasts from the African Development Bank, the inflation rate is expected to decrease from 18.6% in 2024 to 12.6%. Therefore, mass-market products will remain at the core of competition. Manufacturers and channel partners will enhance device affordability through device financing while maintaining price competitiveness, with open channels and entry-level products continuing to dominate. Despite being one of the markets with the greatest growth potential globally, Africa faces a complex business environment involving currency fluctuations, changes in tax policies, and geopolitical risks, posing significant challenges to operational capabilities. It is worth noting that the strong business models established by African manufacturers, from addressing sudden risks to meeting the needs of the mass market, will serve as a reference for expansion into other emerging markets."