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Nigeria’s digital transformation is rapidly gaining momentum, as highlighted by a recent report from Public First. In 2023 alone, Google’s products and services, including Search, Ads, YouTube, and Cloud, contributed an estimated $1.8 billion in economic activity across Nigeria. Additionally, the report indicates that by 2030, Artificial Intelligence (AI) could potentially contribute a staggering $15 billion to Nigeria’s economy.
A 2024 report by the GSMA further underscores the role of mobile technology in driving Nigeria’s digital economy. According to the report, the mobile sector contributed N33 trillion to the country’s GDP in 2023, with N2.4 trillion in tax revenue, making it a significant source of government income. By 2026, experts predict the sector could generate up to $18.3 billion, cementing its position as a cash cow for Nigeria.
National Digital Economy Bill
Amid global economic shifts and technological advancements, Nigeria is on the verge of a digital revolution. The country’s digital economy is set to become a driver of economic growth, job creation, and innovation. Key to this transformation is the National Digital Economy Bill. The bill aims to provide a comprehensive legal framework for electronic transactions, digital signatures, and e-government services. This legislation is designed to replace paper-based processes with digital solutions, streamlining operations across sectors.
Nigeria’s multi-faceted approach to digital transformation is anchored by several initiatives. They include 3 Million Technical Talent Programme and the Broadband Alliance. These programs aim to enhance productivity across sectors through technology. They are also designed at positioning Nigeria as a leader in digital commerce within the African Continental Free Trade Area (AfCFTA) framework. The country’s digital economy has already revolutionised how millions of Nigerians shop, bank, and communicate. All of these unlocking new opportunities for economic growth.
A fraction of Nigeria’s digital economic potential
However, a study by the World Bank’s Nigeria Digital Economy Diagnostic reveals that Nigeria is currently capturing only a fraction of its digital economic potential. Strategic investments in digital infrastructure and education are needed to develop a truly dynamic and transformative digital economy.
Progress has been made in human capacity building. Initiatives such as Google’s Digital Skills for Africa and the 3 Million Technical Talent Programme have helped in training over 1.5 million Nigerians in digital skills in 2023 alone. But there are still gaps to address, particularly in STEM education and AI fluency, to prepare Nigeria’s workforce for the future.
Digital infrastructure remains a critical challenge
Digital infrastructure remains a critical challenge. While Nigeria boasts the largest mobile market in Sub-Saharan Africa, supported by strong broadband infrastructure and improved international connectivity, fixed broadband is limited, especially in rural areas. This leaves a significant portion of the population without internet access. Consequently, hindering the country’s ability to fully harness its digital potential.
Efforts to digitize public services are underway, but more needs to be done. Both public and private digital platforms are essential to support eCommerce and the provision of digital services. One of the biggest challenges is the lack of formal identification records for millions of Nigerians. The implication is that millions are prevented from accessing essential public and private services.
Improving the policy environment
The government also needs to improve the policy environment for digital entrepreneurship. Nigeria has large, youthful, and entrepreneurial population. But the potential for digital entrepreneurship remains underexploited. Agencies like SMEDAN must enhance their efforts to engage more young Nigerians in digital entrepreneurship schemes. There must be intentional efforts at unlocking new engines for economic transformation.
Access to digital financial services is another area in need of improvement. While progress has been made, a large number of Nigerian adults still lack access to formal financial accounts, which hinders the country’s efforts toward financial inclusion and economic participation in the digital space.
Nigeria’s path to sustained digital growth requires the right policies, targeted investments, and collaboration between key stakeholders. By investing in digital infrastructure, promoting digital literacy, and fostering innovation, Nigeria can build a robust, inclusive, and sustainable digital economy that meets the needs of its citizens and drives economic growth for years to come.
