Article by Elvis Eromosele
The information and communication technology (ICT) sector in Nigeria has seen significant growth and development in recent years.
The National Bureau of Statistics (NBS) revealed that the sector contributed 18.44 per cent to the nation’s GDP in the second quarter of 2022. Experts argue that the country’s youth-dominated 210 million-strong population is driving demand for ICT products and services.
The government has made significant efforts to promote the development of the ICT sector and increase access to ICT infrastructure and services.
This has included initiatives such as the National Broadband Plan, which aims to increase broadband penetration in the country, and the National eGovernment Master Plan, which aims to increase the use of ICT in government operations and services.
Of course, there are several challenges that the Nigerian ICT sector faces, including a lack of reliable and affordable electricity, multiple taxations, regulatory bottlenecks, limited access to ICT infrastructure in rural areas, and a dearth of skilled ICT professionals.
Despite these challenges, the sector has continued to grow with the potential to play a significant role in the country’s economic development.
Looking ahead into 2023 here are potential trends that may shape the development of ICT in the new year.
1. Increased adoption of cloud computing:
As businesses in Nigeria look to reduce costs and improve efficiency, many will turn to cloud computing solutions to store and process data. There are a growing number of important players in this space including Rack Centre, Cloudflex Computing Services Limited, and Layer3Cloud among others.
2. Growth of the e-commerce industry:
Nigeria’s large and rapidly growing population and the adoption of mobile devices and internet access has made e-commerce more accessible. With improvements in electronic payment and logistics sectors, the growth trend is likely to continue into the coming years. Konga, Jumia and Jiji continue to show what is possible in this space.
3. Expansion of mobile broadband:
The proliferation of mobile broadband is expected to continue in Nigeria, driven by the increasing demand for data services and the roll-out of 4G and 5G networks.
The Nigeria Communications Commission (NCC) in 2021 granted 5G licenses to MTN Nigeria and Mafab Communications with Airtel joining the party this December. MTN is known to have rolled out services in certain cities. 2023 holds promises of more roll-outs and improved access to 5G services in general.
4. Rise of fintech:
The fintech industry in Nigeria has seen significant growth in recent years, and this trend is likely to continue as more people turn to digital financial services.
Reports suggest that there are over 200 Fintech firms in Nigeria rapidly helping to bridge the financial inclusion gap.
The fintech ecosystem covers businesses focused on mobile payments, digital banking, merchant solutions and personal finance among others. Interswitch, Flutterwave, Paystack, PiggyVest, Paga, and E-tranzact are some of the biggest players in this space.
5. Increasing use of artificial intelligence (AI):
The use of AI in various sectors, including healthcare, education, and agriculture, is expected to increase in Nigeria as the country looks to leverage technology to solve problems and improve services. The early players here include Lare Ayoola’s IoT Africa Networks Limited, Kobo360 and Data Scientists Network.
6. Growth of the outsourcing industry:
Nigeria’s highly educated workforce and lower labour costs make it an attractive destination for outsourcing. This trend is likely to continue as companies look to outsource certain business functions to save costs, improve productivity and boost profitability. Renda, Philip Outsourcing, and Workforce Group are leading players in this space.
7. Increased adoption of digital skills:
As the ICT sector continues to grow, there will be greater demand for individuals with digital skills. This trend is likely to drive the development of training programs and initiatives to help people acquire the necessary skills. Governments at different levels are making tremendous efforts in this space.
The National Information Technology Development Agency (NITDA) through its subsidiary, the National Center for Artificial Intelligence & Robotics (NCAIR) is training one million developers with a focus on Python for Machine Learning and Data Science.
The Lagos State Government has also commenced the Second Phase of the Eko Digital programme which aims to empower one million youths in the State with cybersecurity skills. Numerous other initiatives are ongoing in the private sector space.
ICT will remain a significant proportion of the economy in the foreseeable future. Human capacity development and infrastructure deployment will however dominate the ICT space in 2023.
Happy New Year in Advance!