How is the RAM Crisis impacting emerging markets?

Details: James Barton; Category: Consumer Ecosystems; 29 April 2026; 804 views

As AI firms look to handle their ever-escalating compute loads, they are snapping up the global supply of consumer graphics processing units well before more can be produced – causing prices to surge worldwide for any product that contains a semiconductor.

The RAM crisis is causing pain in the technology and telecoms sectors, but its impact in emerging markets - such as Africa, Latin America and parts of Asia – is potentially debilitating. Francisco Jeronimo of IDC notes that these regions will feel the adverse effects of this crisis particularly acutely because the typical selling price for devices in these markets is well below the global average (around US$458 in 2025). For the Middle East and Africa (MEA) the average is around US$236; in Asia excluding China, South Korea and Japan, around US$335; and for Latin America, US$349. To provide further context, Jeronimo notes that in MEA, sub-$200 devices make up 77% of total smartphone sales, whereas in Western Europe, this price band accounts for just 18% of sales.

“The reasons for this are obvious” explains Jeronimo. “People cannot afford the more premium devices, even if the segment is also growing in those regions, so the majority of people rely on very affordable smartphones - and that's exactly the segment that will be hit the hardest.”

If a high-end device costing around US$1000 increases in price by US$100-150, its target audience can afford to absorb this cost. However, consumers of low-cost devices (US$100-200) are buying them because they cannot afford a more expensive smartphone. An increase on the same scale represents 50%-100% of the device’s price, which users will not be able to afford. Additionally, in the premium segment, smartphones are typically available to purchase in instalments or via financing programs, whereas for lower cost devices in emerging markets, there are few options apart from paying the total cost upfront.

Market shock

IDC estimates that the global smartphone market will decline by 13% in 2026, but in the same timeframe, the firm forecasts that the MEA region’s market will shrink by 21%. “These are the kind of declines that we've never seen in any market, even where the adoption of smartphones took much longer and people tend to still rely on feature phones”, says Jeronimo. “So clearly there's an impact, and there will be a bigger gap between emerging markets and developed markets in terms of smartphone adoption.”

However, Ben Roberts of Digital Economy Advisers has a more sanguine attitude about how badly Africa will be affected by the RAM crisis. He notes that because the majority of devices purchased in emerging markets are low-end, this creates a huge market for companies such as Transsion, which design and manufacture devices specifically aimed at this segment. Roberts argues that since high-end devices will be impacted the most, lower-end devices may not be as adversely affected by the RAM crisis. He notes that companies assembling devices locally within Africa, including in Kenya, South Africa and Ethiopia, typically import assembled printed circuit boards (PCBs) along with other components before assembling the devices manually. This means that in terms of employment, the immediate knock-on effect in the supply chain will be cushioned, as RAM chips are not used at high volumes within Africa.

“I don't know what devices will be impacted, but certainly the iPhone 18s are not your biggest seller in Africa”, says Roberts. However, he acknowledges that there will be pain when the supply chains for manufactured equipment are hit with knock-on effects in terms of price and availability. In this scenario “the impact for Africa will be worse, because if prices go up, they'll probably send [devices] to higher paying markets where there's more people who are going to pay the high prices.”

However, Roberts notes that this could open the door for widespread adoption of devices that use lower-end components. He highlights the success of companies such as M-Kopa and Eadak, which are manufacturing low-cost devices domestically which retail for around US$50, as well as STL (Semiconductor Technologies Limited) which is etching silicon wafers in Kenya for older generation chips, but argues that more domestic high-tech manufacturing and aggregation of raw materials will be required to insulate Africa from the RAM crisis going forward. “The main thing is that minerals are extracted and exported without any value addition. The aspiration Africa is having is how to turn that into high value products, rather than just exporting more minerals.”

Counting the cost

Jeronimo cautions that vendors are already looking at ways to reduce the cost of the specs for announced devices, such as reducing the size of batteries, the quality of the display, or even turning to different manufacturing materials such as plastic. However, vendors such as Transsion are already hinting that it soon be economically unviable for them to sell devices for under US$200. This will affect many consumers in the MEA region; even if they see the cost of devices increase, they will not have many other options – particularly if lower spec devices are no longer available – and so will turn to the refurbished and second-hand market, which will continue to grow apace, to the extent that demand is outstripping supply. Smartphones are now an essential in emerging markets – they provide access to the internet and therefore payments and other basic services, so people will find ways, and Jeronimo notes that vendors may start to try more innovative approaches.

“We are hearing stories of vendors trying to buy second hand devices to get the memory so they can put it on new phones”, says Jeronimo. “We will see phones with much lower specs, plastic materials, cameras that are not as good – [vendors] know that someone who can only afford a $200 phone will not buy a $400 one just because they discontinue the lowest end of their portfolios, so they will have to find a solution for those customers.”

Jeronimo notes that vendors are cutting budgets around marketing, events, and investments to be able to address and absorb the increased memory costs. Whether this continues beyond 2027 is based on two factors; the first is whether the rumoured AI bubble will pop at some point. If this happens, then the hyperscalers buying up the entire memory capacity of larger suppliers will presumably put purchases on hold, alleviating the situation somewhat. The second is how consumers react to the situation; in Africa, they have few options outside of used devices, but in regions such as Europe or the US where premium devices account for a much higher proportion of the market, vendors may be able to increase their margins by passing some of the cost onto consumers, allowing them to support the lower end of their portfolios.

Bespoke solutions

Market stabilisation may seem a long way off, but given that the rush for RAM has been fuelled by AI training and the need to house data close to GPUs, Roberts believes that the solution will involve firms developing proprietary special purpose chips. He gives the example of Google’s Tensor Processing Units (TPUs) which are designed for AI training; firms can purchase these instead of RAM designed for consumer products to handle their compute, and thereby avoid driving up prices across other sectors. The prevalence of purpose-built components, rather than buying up chips designed for other purposes, will help to alleviate the RAM crisis in the long term.

While this process is undoubtedly in motion, it will likely be at least another year before we see any tangible results – which unfortunately means that even if emerging markets have some insulation from the RAM crisis, they may yet have to brace for impact.