Digital startups in Nigeria are driving innovation in fast-growing sectors such as fintech, healthtech, agritech, media and entertainment, e-commerce, e-mobility, and e-logistics; contributing to Continent’s growing Internet gross domestic product (iGDP) — defined as the Internet’s contribution to the GDP.
The Director General of the National Information Technology Development Agency (NITDA), Mr. Kashifu Inuwa Abdullahi, reiterated this while addressing group of investors from Middle East, Europe, America and Asia who attended Africa Investment Forum (AIF) 2020 held today at the ongoing Gulf Information Technology Exhibition (GITEX) in Dubai.
Speaking on the Forum’s theme: ‘Nigeria and Africa Business Focus: Startup Entrepreneurship and Digital Economy,’ Abdullahi said that Nigeria and indeed Africa, have startups with potentials to scale and presently require investments.
He said that the focus on investments in infrastructure and new government policies and regulations is play important role in supporting Africa’s digital growth.
With a record $2.02 billion in equity funding raised in 2019, according to Partech Ventures Africa and Nigeria accounting for 51% of the investments, the country has proven itself as a fertile ground for investments.
He described the Africa Investment Forum (AIF); an annual event at GITEX, as a great opportunity to showcase Africa’s potential to the world.
“Africa has become the fertile ground for investments. However, and like previous speakers have said, ‘if not China, who will build Africa’. The truth is that Africans will build Africa. We have unique opportunities to contribute immensely to the global digital economy. Our size and population remain competitive advantages.
“Nonetheless, Africa does not operate in isolation. That is why we are open to investors. Yes. The world economy is shifting from the way we work and transact or do things. This new normal is powered by technology and technology is driven by the people. Suffice to say that Africa with the youngest population in the world stands the opportunity to rule in the digital space. It is projected that by 2050, Africa will account for 1/3 youth in the world. So, this is a potential that we need to harness well.
“In addition, three things are creating and shaping the African economy. First, available, affordable and fast internet connectivity. Secondly, our startups are transforming the business landscape and the economy in general. They are coming up with ground-breaking ideas, solving African challenges in healthcare delivery, especially in the remote areas; education, financial inclusion, retail, and other “challenges. Thirdly, the commitment to create the world largest-single free trade area – our Continent will soon begin to implement the African Continental Free Trade Agreement (AfCFTA) which will create the single largest market in the world”, the DG said.
He re-emphasised that these three trends are shaping and creating the future for Africa.
“We have talented startups”, he assured the investment community gathered at the event.
Quoting the recent e-Conomy Africa 2020 report released recently by Google and the International Finance Corporation (IFC), Abdullahi said it was estimated that Africa’s Internet economy has the potential to reach 5.2% of the continent’s gross domestic product (GDP) by 2025, contributing nearly $180 billion to its economy.
Continuing, he said, “This shows that our startups can generate a lot of value in our economy and yield dividends to the investors. Nigeria in particular has a lot of advantages; looking at our location and population. Nigeria is contributing almost 18% of the African GDP. So by the projection of that report, Nigerian startups can generate up to $36 billion by 2025, if they harness the power of the Internet Economy and have enough and right investments.
“As a government, we are creating the enabling environment for them to thrive. Our parent Ministry under the leadership of Dr. Isa Pantami, is implementing policies that will create an enabling environment for our startups to thrive.
“We are actively doing this through the National Digital Economy Policy for Digital Nigeria; the National Broadband Plan and recently we are working on the National Digital Innovation and Entrepreneurship Policy. At NITDA, we are implementing these policies formulated by our supervising Ministry.
“We are focusing on creating initiatives that can enable us to create the innovation capacity and entrepreneurial capacity in our country which is the reason we focus more on human capacity development. And we are creating the enabling environment for the funds to flow. For that reason, last year Nigeria attracted 51% of the total venture Capital flows to Africa which is the largest on the Continent. We have promising startups, therefore, we invite you to invest in Nigeria and Africa at large. The future is in Africa”, he added.
The Africa Investment Forum (AIF) attracted investors who are already speaking to some startups sponsored by NITDA to GITEX 2020. Policy makers, government functionaries and captains of industry were also in attendance to support NITDA in pushing for investors in the ICT sector.
Earlier in his presentation titled, ‘Kings of Africa: Unleashing the Power of Innovation for Business Opportunities and Economic Growth’, the Managing Partner, Chanzo Capital, Eric Osiakwan, said that COVID-19 actually proved that Africa’s internet economy has huge potentials.
According to him, while the rapid lockdown across the continent significantly slowed down the virus, it created a knock-on effect of increased online activities.
This, he said, catalysed the digital economy despite slowing down the normal economy.
Osiakwan added that while mobility businesses like HotelOnline, Forhey, etc., were crushed during the lockdown, essential businesses like Hubtel, Zuli, etc., survived and virtualised businesses like e-Commerce surged.
He hinted on a report which estimates that Africa will overtake Asia in demography by 2060 and with the fast growing middle class, Africa has become the toast of the world.