Lack of connectivity in rural areas affecting digital ecosystem in Nigeria, World Bank report
The World Bank Group has launched its first Nigeria Digital Economy Diagnostic Report during an eSummit hosted by the government.
The report reveals that although Nigeria is the largest mobile market in Sub Saharan Africa with a strong mobile broadband infrastructure and a vibrant digital entrepreneurial ecosystem, the lack of infrastructure and connectivity in the country’s rural areas is a key challenge.
The government’s Economic Recovery and Growth Plan for 2017–2020 (ERGP) recognizes the need for a digital-led strategy to make its economy more competitive for the 21st century. In line with this goal, the Digital Economy Diagnostic reveals that the country has made several positive developments in the digital space including high-speed Internet via five underwater international links.
This has significantly reduced constraints in terms of international bandwidth usage and prices, as well as boosting network capacity.
Additionally, the diagnostic found that Nigeria is improving on the provision of digital platforms. For example, the government created a central portal to improve the delivery and quality of public services. With the size of Nigeria’s economy, the report highlighted the enormous opportunities Digital Financial Services (DFS), a driver of financial inclusion, could have for this growing market.
The financial sector has already benefitted from investments in payment systems and financial markets infrastructure, such as the Bank Verification Number (BVN). Millions of Nigerians still lack formal identification records to access a range of public and private services. Financial inclusion in the country has effectively stalled with around 60 million Nigerian adults without access to a formal account.
“Realizing the full benefits of the digital economy requires Nigeria to focus on accelerating improvements in five fundamental pillars of the digital economy; digital infrastructure, platforms, financial services, entrepreneurship and skills” said Shubham Chaudhuri, The World Bank Country Director for Nigeria. “To ensure that the country is digitally enabled by 2030, investing in infrastructure to bridge the digital divide and creating an enabling regulatory environment for the digital economy to thrive is of paramount importance”
Given Nigeria’s large, young and entrepreneurial population, digital entrepreneurship could become an engine of growth, the report notes. Lagos is a mature and active ecosystem with dynamic incubators, venture capital companies, and digital start-ups.
Digital entrepreneurship ecosystems are also growing in the cities of Abuja and Port Harcourt, with a potential for expansion to other cities. But lack of early-stage financing and limited market opportunities outside of Lagos and Abuja remain key constraints.
Nigeria has over 500 tertiary and secondary institutions offering skills development and Technical and Vocational Education and Training (TVET) programs, some of which also offer digital skills for employment.
Some of the dominant education and training programs in Nigeria are offered through private sector–led interventions by (e.g. Andela and Google among others), while the government has also established implementation of digital skills programs as a component of a national digital economy project.
Nigeria can still do more to ensure it takes full advantage of the opportunities bound in its digital economy. The diagnostic highlights the need for strategic investment and interventions needed for Nigeria to kickstart its digital transformation.
