The manifesto of President-elect Bola Tinubu offers plausible plans for Nigeria’s tech ecosystem, but stakeholders believe much more needs to be done in areas of infrastructure and enabling policies.
In March, TechCabal reviewed the plans of Nigeria’s President-elect, Bola Ahmed Tinubu, for the country’s tech industry. Tinubu’s manifesto—part of which is aimed at achieving an inclusive digital economy—offers interesting plans to improve the tech space. These plans, among others, include the creation of one million new jobs in the first two years, talent outsourcing, development of ecommerce, championing tech manufacturing, and state adoption of blockchain technology.
However, these plans appear workable only on paper and reflect a lapse in the government’s understanding of the tech space. With the incoming government expected to be sworn in on May 29, 2023 amid a legal tussle over the legitimacy of the elections, tech players argue that beyond its exciting promises, the Tinubu administration must address certain grey areas to help the tech ecosystem.
Infrastructure is important
For Tayo Oviosu, founder of fintech startup Paga, one issue the Tinubu administration must address is the high cost of accessing the internet in Nigeria. In 2021, Nigeria was reported to have the least affordable internet in the world. According to a recent survey by Surfshark, an Amsterdam-based cybersecurity firm, Nigerians are overpaying for their internet data when compared to other countries.
“To accelerate technology adoption, the cost of data needs to go down. Nigeria is the only country I know where the telco regulator has a minimum price for data in the regulations. It should be removed. Let the telcos compete fairly, and I believe we will see the prices go down,” Oviosu told TechCabal.
He added that the new government must also prioritise solving the country’s electricity crisis, which is one of the biggest problems for Nigeria’s tech sector. Power shortages are particularly a problem for Nigerian startups who incur extra costs generating their own electricity. According to the World Bank, the economic cost of power outages in Nigeria is estimated to be $28 billion, equivalent to 2% of its Gross Domestic Product (GDP).
Getting policies right
One of the lasting legacies of the Buhari administration is the Nigeria Startup Act signed into law in October 2022. The landmark legislation is touted as a game-changer for Nigeria’s tech ecosystem as it addressed major hiccups around the regulatory landscape for startups, including dialogue with the government, tax breaks, and funding opportunities.
However, eight months after its passage, the act is yet to be domesticated by any of the country’s 36 states and its capital. In March, the federal government inaugurated a 27-man implementation committee for the Nigeria Startup Act. According to Oviosu, now is the best time to enact the law.
Though the Act offers tax breaks, the Paga CEO believes the Federal Inland Revenue Service (FIRS) should give tax holidays to startups to encourage more investment. Oluwatomi Solanke, founder and CEO of Trove Finance, agrees, saying, “The government should also consider incentivizing startup hiring.”
Segun Cole, founder of Fund the Gap Alliance, adds that for the new government to fully realise the potential of the tech sector, it should consider creating a Ministry of Startups. “Such a ministry would serve as a dedicated point of contact for startups, offering targeted support and resources to help them grow and scale. This would signal the government’s commitment to fostering innovation and entrepreneurship in Nigeria and help attract even more investment and talent to the sector,” he said.
Addressing the talent gap is a must
The global demand for tech talent keeps increasing, but in Nigeria, the situation is grimmer considering the “japa” trend, reflected in the mass exodus of tech talent from the country. For context, the country has about 89,000 software developers, out of a population of over 200 million.
Cole believes that Nigeria has a large pool of talented and innovative young people, but many lack the technical skills and training needed to succeed in the tech industry. “The Tinubu administration is expected to invest in education and training programs to develop the next generation of tech talent, as well as to attract more talent from other countries,” he said, citing Itana, the talent hub being spearheaded by Iyinoluwa Aboyeji.
For Solanke, more attention must be paid to promoting research and development (R&D) in tertiary institutions. “Many innovations we see in the United States come from its Ivy League universities. The government should focus on R&D hubs and even incentivize students working on tech-focused projects. I think this will help spark innovation and in turn, catalyse the tech ecosystem, ” he told TechCabal over a call.
CEO of AltSchool Africa, Adewale Yusuf, adds that he expects the new government to create “access to financial aid for students to learn in-demand skills.” With strategic investment in building the capacity of young Nigerians in tech, the supply of tech talent is expected to ramp up.
To achieve its goal of creating an inclusive digital economy, the Tinubu administration must be willing to go beyond its initial proposal and embrace a more proactive and collaborative approach to address the problems of the Nigerian tech ecosystem. For the industry to sustain its success, there is a need for bold and transformative actions from the government.