1. Certified Forensic Investigator
The Economics of Cybercrime and Digital Freedom: Implications for Africa Economic Integration
Oyewole Simon Oginni
Certified Forensic Investigator

2. Law enforcement is presently 5 to 10 years behind the global crime curve in relation to technological capabilities(Alexander, 2002)

3. Presentation Structure
Global Economy of Cybercrime
Conclusion and Recommendations
Africa Economy of Cybercrime
Phenomenonology of Cybercrime

4. Global Economy of Cybercrime
WHAT IS IT?

5. Global Economy of Cybercrime
Cybercrime is the fastest growing business globally with highest returns and lowest risks.
Approximately $400 billion is lost to cybercrime on average annually (McAfee, 2014). This amount is enough to address socio-economics needs and budgets of some countries in Africa.
The cost of cybercrime varies according to country’s income status, unemployment rate, technology innovation rate

6. Global Economics of Cybercrime
Maps of
Global Economics of Cybercrime
Source: McAfee, 2014

7. Global Economy of Cybercrime
Putting Malicious Cyber Activity in Context
CRIMINAL ACTION
ESTIMATED COST
PERCENTAGE GDP
SOURCE
GLOBAL
Piracy
$1 billion to $16 billion
0.008% to 0.025
IMB
Drug Trafficking
$600 billion 5%
UNODC
Global cyber security activity
$300 billion to $1 trillion
0.4% to 1.4%
Various
Source: UNODC, 2013; McAfee, 2014

8. The Economics of Cybercrime in Africa
Contextualizing Africa in the light of the two-edged sword.

9. Africa Economy of Cybercrime
Africa’s economy is disintegrated and fragmentally small in size compared to other regions of the world.
Although developed countries tend to lose more to cybercrime in terms of GDP, Africa tends to suffer more from cybercrime victimization than developed countries.
Nigeria, South Africa, Kenya and Zambia sacrifice 0.08, 0.14, 0.01 and 0.19 of GDP to cybercrime annually . According to Center for Strategic and International Studies (2015), South Africa loses about 5.7 billion rands annually.
Prevalent of unemployment divert IT resources to unproductive sector with higher returns, low risk and increased motivation

10. Africa’s Economics of Cybercrime
Maps of
Africa’s Economics of Cybercrime
Security Threat
Source: UNDOC, 2013

11. African Walrasian Market Model
Rationale for Green Cybercrime
Highly technology savvy, experienced and coordinated
Law Enforcement Agent
Poor legal framework on cyberspace at country-specific, RECs, and Africa Union levels
Increased automation of economic, social and political activities
Low reporting rate
Weak defensive mechanism
Equilibrium Price
Poorly coordinated
Inexperience
Poorly equipped
Low technology savvy
Highly conservative
Highly corrupt
Drug Trafficking
Electronic frauds (ATM frauds, credit card, spams, etc.)
Terrorist’s Recruitment
Criminal Actors
(Suppliers)
Criminal Act
(Demanders)
Organized Cybercrime
Figure 3: Africa’s cybercrime Economic Architecture
Source: Author (2016)

12. Africa Union’s Efforts on Cyber Security
AU Convention on Cyber Security and Personal Data Protection in June, 2014.
In spite of the approval of the Convention among 54 members of AU, the convention fails to address ecosystem of cyber security concern in Africa. It excludes computer-related copyrights and trademark offences, spam, solicitation or grooming of children, computer-related money laundering, device and storage media, malware/malicious software, cybercrime, electronic payment tools offences, identity-related crime among others.

13. Implications for Africa Economic Integration and Security
Loss of financial resources for economic development and the multiplier effect on the RECs and AU
Disincentive to automation of activities (which is an integral part of economic liberalization and globalization)
Increased threats to security and peace
Loss of confidence in internet security and private with attendant result of slow rate of technology adoption and small size of Africa’s intra-trade
Transfer of productive skilled labors to unproductive cybercrime business which offers low risks and high returns

14. Conclusion and Recommendations

15. Conclusion
Undoubtedly, advancement of technology innovation has brought a paradigm shift in intra-trade and integration process in Africa, increased level of demand and supply among Africa countries and created a seamless society towards African renaissance. However, cybercrime has assumed greater dimension that threatens the benefits of digital dividend in Africa. Africa is the least affected countries in economic worth but it is the most affected region in terms of victimization.
Africa has the highest records of computer-related offences in support of terrorism.
Africa has no harmonize policy to address cybercrime in greater details.

16. Recommendations Develop a broad and adjustable laws on cyber space
Provision of ICT infrastructure and training of law enforcement agent
Invest in development and research of IT
Address the critical issues of unemployment; institutionalize informal trade through trade incentive measures
A moderate approach to economic integration instead of following linear structure

17. THANKS