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African PC market suffers largest slump ever

By , Portals editor
Africa , 15 Sep 2015

African PC market suffers largest slump ever

The African PC market, and Kenya specifically, recorded new lows in Q2 amid a slowdown in GDP growth, increasing unemployment and strengthening of the US dollar against many of the continent's currencies.

According to figures released by International Data Corporation (IDC) the market followed up its first-quarter decline of 11.8% with a 26.7% year-on-year downturn in shipments during Q2 2015.

This is described as being "the largest slump the market has ever suffered." However, IDC also stated that while it expects the market to continue on its downward trajectory into the third quarter, growth is expected in the last quarter onwards.

"Kenya suffered the continent's biggest fall of the quarter, with shipments to the country down 54.5% year-on-year, with Ghana and Algeria following with declines of 40.9% and 40.2%, respectively," says Joseph Hlongwane, a research analyst at IDC Sub-Saharan Africa.

"The significant decrease in PC demand seen in Kenya can attributed to sluggish economic growth brought about by falling exports and a declining production sector that is characterised by slow job creation. The poor performances of the markets in Ghana and Algeria were also caused by a slowdown in economic growth arising from severe energy constraints and unsustainable levels of domestic and external debt," he added.

South Africa remains the biggest PC market on the continent, accounting for 35.5% of total shipments, but the country followed up its 4.2% year-on-year decline in Q1 2015 with a decrease of 12.8% in Q2 2015, said the IDC.

"This was largely due to continuing cannibalisation of the market by smartphones and tablets as well as shrinking consumer disposable incomes due to the rising prices of necessities such as petrol and food. South Africa's PC market is expected to continue declining since the current economic challenges are set to remain throughout 2015," the company said.

The IDC also said that Botswana performed better than expected to post the highest year-on-year growth rate across the whole continent.

This growth follows the successful democratic elections that took place in the country in October 2014 and was driven primarily by the commercial sector, which accounted for 87.6% of the total market.

Botswana is expected to see ongoing year-on-year growth in the final two quarters of the year.

Graham Braum, general manager of Lenovo Africa, said that while the IDC stats show a decline in the English-speaking PC market of 23% for Africa as a whole, the company has experienced growth of 42.8% and now has a market share of 21.3%, and 26.7% across consumer, commercial and enterprise segments in South Africa.

Braum speaks of the company's 'protect and attack' strategy that has helped to secure market share in South Africa, Nigeria, Kenya and Namibia.

"Lenovo Africa has shown good growth across the consumer and commercial segments. We have expanded our English-speaking territory into four sub-territories – South Africa, SADC, East Africa, and West Africa, with focused teams in each. Lenovo's 'Protect and Attack' strategy has given us great traction in both spaces, as well as being able to integrate a very strong portfolio of solutions across the consumer, commercial, and enterprise segments offering a strong balance between hardware, software and services."

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