Watch out Lagos, African Tech Firms May Soon Be Flocking to Silicon Zanzibar

The East African archipelago of Zanzibar may be most well-known for its tourism, beaches and wildlife, but the local government is pinning its hope on Silicon Zanzibar, a new public-private initiative, to also turn the island into a leading hub for Africa’s tech firms.

Led by the Zanzibar Ministry of Investment and Economic Development alongside several African tech companies, Silicon Zanzibar aims to attract technology firms and workers from across Africa and beyond to Unguja, Zanzibar’s largest and most populous island, to help transform the island’s economy.

The deal will include benefits and incentives for eligible businesses, including work visas for relocating tech workers and a ten-year corporate tax exemption through the Zanzibar Free Economic Zone.

B2B firm Wasoko is the first to take advantage of these perks in its role as founding partner for Silicon Zanzibar and official private sector ambassador of the project. At the project’s launch last week, the pan-African eCommerce marketplace became the biggest private sector partner to set up shop in Zanzibar’s Fumba “Eco-Town” through the newly inaugurated Wasoko Innovation Hub.

Read more: B2B Marketplace Wasoko, Zanzibar Team to Build Innovation Hub

Wasoko is part of a rising tide of tech platforms looking to deliver solutions for Africa’s booming eCommerce sector, which present both challenges and opportunities that are unique to the continent.

As the company’s founder and CEO, Daniel Yu, told PYMNTS earlier this year, unlike the digital payment systems preferred by American companies like Amazon, in the markets Wasako operates in, cash still plays an integral function.

Watch Yu’s interview: African B2B Marketplace Wasoko Takes On Supply Chain Inefficiencies

“We do actually still primarily collect payment on delivery, and the majority of that is actually still happening in cash,” he explained, adding that this is “a reflection of the fact that informal retailers operating local communities do largely still serve their consumers through cash.”

Tech for Africa, Built in Africa

For a company like Wasoko, whose customer network is distributed across Africa, but which also has to deal with international supply chains, Zanzibar is well-situated to act as a gateway to the rest of the continent.

As the Silicon Zanzibar website points out, the island is connected via direct flights to over 20 major destinations across Europe, the Middle East and Africa, while fiber optic infrastructure in Fumba Town means the firm can ensure a reliable internet connection.

Speaking at the launch of the hub, Yu, who has announced his relocation to Zanzibar, said that the pan-African tech company had been searching for a location to innovate and develop new products and services. Although more traditional centers such as Dubai and London came up top of the list, he said, “We were ultimately committed to the belief that technology for Africa should be built in Africa.”

He added that “we strongly believe Wasoko will be the first in a long line of tech companies to establish a presence on the island.”

Silicon Zanzibar has already attracted the likes of Tushop, a Kenyan community-commerce platform, and Y Combinator-backed startup Ramani, which is looking to shape the way African supply chains operate with its new digital platform.

And as Yu said, the potential for more firms to make the move is huge given that the continent’s ecosystem is still young compared to the U.S., and there’s plenty of space for alternative technology hubs outside of popular hubs such as those in Lagos or Nairobi.

So, in this modern era of international commerce, remote working and the hyperconnected digital economy, Zanzibar has an opportunity to sell its palm trees and golden sands as more than just a week-long getaway, but as a long-term, sustainable business destination for all kinds of digital enterprises.

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