The Nigerian tech industry under Buhari: A success story or a missed opportunity?

The patience to hold on to writing this piece should be studied by get-rich-quick internet fraudsters, not because it’s a virtue, but because the lessons learnt can’t precisely be listed in one website article. The former president Muhammadu Buhari is off to Daura, and a new President, Bola Ahmed Tinubu, is in. While we need to move on from the mixed, mostly negative feelings of the former, we need to recall our past and understand how to build on it.

While in office, Muhammadu Buhari took some steps to improve the state of the tech industry in Nigeria, including launching the Startup Bill and signing the same into law. 

“Today I signed into Law the Nigeria Startup Bill (NSB), developed by our administration to provide stable legal framework and incentives for technology innovation,” the tweet from the former president read.

The bill offers tax breaks for startups and their employees, a path to dialogue with government officials and the Startup Investment Seed Fund for young Nigerian entrepreneurs. 

But the bill has been criticised for stifling young entrepreneurs who are not Nigerians but own businesses in the country, Dennis Da-ala Mirilla wrote in an article. 

Yet, the bill’s signing was part of the president’s wide-ranging development, including rolling out a National Digital Economy Policy and Strategy, a National Centre for Artificial Intelligence and Robotics, National Data Protection Bureau and National Data Protection Bureau.

“This is in line with the vision of President Muhammadu Buhari, GCFR, to diversify the economy of Nigeria away from dependence on the oil and gas sector. The growth of the digital technology sector over the past few years is a good indication that this sector can serve as a catalyst for the rapid development of the economy.”

Months later, a positive stride was reported – even though it has been on steady growth. The ICT sector accounted for 17.47% of Nigeria’s GDP in the first quarter of 2023, demonstrating a substantial rise from the 16.2% recorded in the corresponding period of the previous year. This growth signifies the increasing importance of ICT-related activities to the country’s economic development.

Also, to report on the implementation of NDEPS, Professor Umar Garba Danbatta, Executive Vice Chairman/CEO, NCC, wrote in a letter, “In line with one of the pillars of the National Digital Economic Policy and Strategy, (NDEPS 2020-2030), which is to further accelerate economic growth in digital literacy and skills, the NCC is fully committed to the effective and efficient implementation of the Federal Government’s policy direction in repositioning the youth for the digital era job opportunities through a programme tagged, Digital Job Creation for Youths (DJCY).

“Over 2,000 Nigerian youths have, so far, benefited from this programme from the Six (6) Geopolitical Zones of the country while the ongoing edition has 600 youths being trained.

“Some of the objectives of the DJCY include to remould youths with other skills with Information and Communication Technology (ICT) proficiency to fit into the digital economy as well as strengthen technical and scientific competences among the youths with a view to creating opportunities for self-employment. It is also designed to improve access to ICT-enabled services such as banking, and strengthen the ICT micro, small and medium enterprises (MSME) sector of the economy.”

Dr Isa Pantami, Minister of Communications and Digital Economy, explained that the centre is related to the seventh pillar of NDEPS, which is on Digital Society and Emerging Technologies.

“Artificial Intelligence is the refinery of the digital economy, and Robotics is very useful in supporting companies as they carry out repetitive tasks. These are two very important emerging technologies that will shape the face of future technologies. We have decided to be proactive to enable us to play a key role in how these technologies evolve.

“The Fourth Industrial Revolution, fuelled by Big Data, propelled by robust computing capacity, advanced software and Artificial Intelligence is ushering new ways of living, well-being, learning, travelling and working.

“Its innovative use cases are quickly changing lives for the better and creating new types of jobs,’’ Pantami said.

According to the statement contained in the document, signed by the Head of Legal, Enforcement & Regulations, NDPB, Barr Babatunde Bamigboye, “The central objective of the Bill is to safeguard the fundamental rights and freedoms, and the interests of data subjects, as guaranteed under the Constitution of the Federal Republic of Nigeria, 1999, by providing for the regulation of the processing of personal data.”

The National Commissioner of the NDPB, Dr Vincent Olatunji, said it would create at least 500,000 jobs from its planned initiative of licensing and indigenous institutions.

“We have initiated a comprehensive process for training and certification of data privacy as well as protection experts in Nigeria,” Dr Vincent said.

Muhammadu Buhari inaugurated the Presidential Enabling Business Environment Council (PEBEC), a specialised agency for Nigerian businesses, in 2016. Its purpose is to ensure that doing business in Nigeria is easy through reforms and policies.

And in April 2023, Yemi Osinbajo disclosed that since its inception in 2016, PEBEC has delivered over 180 reforms and completed 7 National Action Plans to improve the Nigerian business environment.

“Over the last seven years, our visionary team, dominated by young Nigerians from both private and public sectors, led by Dr Jumoke Oduwole, have designed and implemented a series of reform initiatives at the federal level with measurable success. Among other tools and strategies, the team developed a homegrown 60-day accelerator – our National Action Plans (NAPs) – to implement priority reforms by select Ministries, Departments, and Agencies (MDAs) for each annual reform cycle.

“The PEBEC Secretariat supports about 15 priority public-facing agencies and currently tracks over 53 MDAs. This is in support of Executive Order 001 on Transparency and Efficiency of public service delivery to the business environment as well as ReportGov. NG, the Council’s feedback mechanism.

“I am told that the PEBEC Secretariat team enjoys the collaboration of several reform-minded heads of MDAs and Reform Champions who were instrumental in the development and implementation of these plans,” Osinbajo said.

“As we continue with our efforts of diversifying our economy, the need for ubiquitous broadband access cannot be overemphasised. We are aware of the economic growth opportunities afforded by the deployment of broadband technologies. I am told that every 10% increase in broadband penetration results in about 2.6% to 3.8% growth in GDP. This informed the Government‘s decision on the renaming of the Federal Ministry of Communications to the Federal Ministry of Communications and Digital Economy in October 2019 as well as the unveiling of the National Digital Economic Policy and Strategy in November of the same year,” Buhari wrote in March 2020.

President Buhari’s administration has made commendable efforts to promote the growth of the tech industry in Nigeria. The establishment of the Office for ICT Innovation and Entrepreneurship has provided a platform for collaboration between the government and tech entrepreneurs, fostering innovation and creating job opportunities.

Dr. Isa Pantami, Former Minister of Communications and Digital Economy

Nigeria’s technology sector was projected to create three million jobs and generate £67.4 billion for the economy by 2021, according to the United Kingdom Digital Minister, Matt Warman, as quoted by UK’s Department for Digital Culture, Media and Sport, at the first-ever UK-Africa Investment Summit in London in January 2020.

There are numerous other expectations like that, and we are tired of the projections. In support, some tech industry players believe we have a long way to go.

Tomi Davies, Collaborator-in-Chief (CiC) at TVC Labs, says “None that I am aware of” when asked what specific policies or initiatives Buhari implemented that positively impacted the tech industry.

Negating that position, Esigie Aguele, co-founder and CEO, VerifyMe, says, “the push to have Nigerians documented and have a digital ID really helped power financial inclusion, particularly among Fintech companies. Accounts for non-traditional banking rose exponentially, in addition, Executive Order 5 – to improve local content in public procurement began the steps to make sure Nigerian businesses are afforded the opportunity to compete. The Startup Act is also a first step to establishing a regulatory environment and protection for startups.”

Tomi insists that Buhari’s actions “stifled” the tech industry’s growth and “sent it backwards.” He argues that “most if not all [sectors of the tech industry] felt under siege and are now hoping to recover.”

On his part, Esigie says “the intent was there. I would assess that there was support for innovation.”

The number of people who were registered for digital identity went up over 100% from about 30 million to 70 million. This is big because it greatly increases the market size but most importantly greatly increased the number of people that will have access to life changing services.

Esigie Aguele, co-founder/CEO, VerifyMe.

He continues, “Fintech and digital/tech innovation sectors benefited [from Buhari’s administration], but overall, I think there is much more to do to secure business growth in Nigeria. For example, with crypto, the policies did more harm than good.”

Undoubtedly, Muhammadu Buhari has been criticised for his lack of support for the tech space in Nigeria. Some of the criticisms include an unfavourable regulatory environment.

The regulatory environment in Nigeria can be complex and uncertain. Startups often face challenges with licensing, permits, and compliance with various regulations. Ambiguous or outdated laws may hinder innovation and make it difficult for companies to operate efficiently.

Buhari’s government has implemented several regulations that have made it difficult for tech companies to operate in Nigeria. For example, the government has imposed a ban on cryptocurrency and has made it difficult for tech companies to obtain visas for foreign employees.

However, The Federal Executive Council (FEC) approved the National Blockchain Policy for Nigeria to retrace its steps. Pantami said blockchain technology would help to ensure data integrity and could add up to $1.76 trillion to the global GDP by 2030.

“A national steering council would be established to coordinate the efforts of relevant government institutions towards the implementation of the policy, ” the minister said. 

The current challenges post-Buhari

Nigeria’s tech industry continues to face several challenges, including:

1. Infrastructure limitations: Adequate infrastructure, such as stable power supply, internet connectivity, and reliable transportation, remains a significant challenge. Inconsistent power supply hampers operations, and limited internet access affects digital services and startups. Insufficient transportation infrastructure makes distributing products and reaching target markets difficult.
2. Funding constraints: Access to funding remains a significant challenge for startups and entrepreneurs in Nigeria. Although there has been some improvement in recent years, securing sufficient capital to develop and scale tech ventures can still be difficult. Limited access to venture capital, angel investors, and other funding sources inhibits the industry’s growth.
3. Talent gap: Despite Nigeria’s large population and growing interest in technology, there is still a significant talent gap. There is a shortage of skilled software development, data science, and cybersecurity professionals. The limited availability of experienced talent affects the industry’s growth potential and competitiveness.
4. Limited local market: While substantial, Nigeria’s local market still faces challenges. Economic disparities and limited purchasing power in certain segments of the population restrict market size. Additionally, inadequate infrastructure and logistics networks can hinder product distribution nationwide.
5. Cybersecurity concerns: With the increasing reliance on digital platforms and services, cybersecurity threats have become a significant challenge for Nigeria’s tech industry. Cyberattacks, data breaches, and fraud pose risks to businesses, consumers, and the overall ecosystem. Addressing these concerns and developing robust cybersecurity measures is crucial for the industry’s stability and trust.
6. Education and skill development: The education system in Nigeria faces challenges in keeping up with the rapidly evolving tech industry. To nurture a skilled workforce, there is a need for improved curriculum and programs that focus on STEM (Science, Technology, Engineering, and Mathematics) education. Enhancing vocational training and providing opportunities for continuous skill development is essential to bridge the gap between industry requirements and available talent.

President Bola Tinubu steps in

On expectations of President Bola Tinubu for tech space, Tomi simply says, “A more supportive policy environment.”

The new government must prioritise solving the country’s electricity crisis, which is one of the biggest problems for Nigeria’s tech sector.

Tayo Oviosu, founder of Paga

In his manifesto, Tinubu pledged to make Nigeria a hub for technology and innovation and to create an environment where businesses can thrive. He has also promised to invest in education and training so Nigerians can develop the skills they need to succeed in the digital economy.

In addition to his general plans for the tech ecosystem, Tinubu also made specific proposals for addressing some of the sector’s challenges. For example, he pledged to provide tax breaks for startups and to create a fund to support research and development. He also promised to work with the private sector to develop a national broadband plan, which Buhari established.

Tinubu’s manifesto has been praised by some in the tech community, who say that his plans are ambitious and could help to transform Nigeria’s economy. However, others have expressed scepticism, saying that Tinubu’s promises are unrealistic and that he has a history of making empty promises.

Only time will tell whether Tinubu can deliver on his promises for the Nigerian tech ecosystem. However, his manifesto clearly indicates that he is aware of the sector’s importance and that he is committed to its development.

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