How Technology Boosts Nigerian Economy

Technological growth is crucial to economic growth and development, and the more advanced the technology available, the more quickly the local and global economy can improve. Advances in technologies have the potential to improve the standard of living, increase leisure time, reduce the poverty level as well as increase the capacity for developing a greater variety of new products and services.

Technology is now at the forefront of driving Nigeria’s economy, bringing up startups, providing a lifeline for the financial sector, supplying blood to e-commerce, and giving a spark to the creative industry, thereby producing young technopreneur millionaires. Technology facilitates the development of infotech, fintech, Edtech, health techs startups as well e-commerce sites, Websites, etc, that are springing up in the country.

Creation of Jobs: Nigeria’s large population has always affected its rate of unemployment. The growth of technology has helped to significantly manage the growing unemployment rate in Nigeria. The ICT sector is one of the largest employers of labour in the country and is directly responsible for creating millions of jobs. According to the Nigeria Communications Commission, ICT alone provided about 2.5 million jobs in 10 years. Thus, technology is providing solutions to unemployment in the Nigerian economy because employment is one of the key drivers of a sustainable economy. Although some claim that new technology steals jobs by reducing labour, technology does not cause a net increase in unemployment or make labour obsolete. It is a net creator of jobs because the resulting higher dividends are reinvested into different tech ventures. When improvement in technology increases productivity, the demand for labour tends to rise, thereby creating more job opportunities and raising wages. At a time of slowed growth and continued volatility due to the pandemic, technology provided the opportunity to create millions of jobs.

Contribution to GDP growth: Nigeria had a mono-economy where Crude Oil has been the major driver of the growth of Nigeria’s GDP since the 1960s, but in the past decade, ICT has taken over. The sector is currently one of the fastest-growing industries since 2012. According to NCC statistics, ICT alone contributed N31.86 trillion to Nigeria’s GDP in the last 5 years. ICT broadband is also associated with GDP as World Economic Forum reports that a 10% increase in broadband penetration is associated with a 1.4% increase in GDP growth in emerging markets like Nigeria. Other tech startups have also contributed to boosting the Nigerian economy and adding to its GDP. Nigeria’s estimated 37 million SMEs contribute a lot to its economic growth (in terms of employment, logistics, and utility bills) and currently contribute 48% to its GDP.

Business Innovation: The Internet provides businesses in Nigeria with new ways of reaching out to customers and competing for market share. For some years, social media has established itself as a powerful marketing tool. ICT tools are utilized within companies to streamline business processes and improve efficiency. The remarkable surge toward connected devices all over the world has created new ways for businesses to serve their customers. Customers can now find ways to connect with businesses in Nigeria and in the process, the economy benefits tremendously.

Work: The idea of work revolved around the common 8-5 office schedule until recently. The coronavirus pandemic brought about a new norm of working that changed how we do work. While many still debate its merits and demerits, the new remote working has some obvious benefits like reduced traffic time, reduced administrative costs, and flexible work schedule among others. Individuals can now do work without any hindrances while creating an improved work-life balance.

Improved communications: From Post office letters to landlines, mobile phones, and then smartphones, communication in Nigeria has developed over the years to make it easier to communicate with people anywhere across the world. A major turning point for communication was the privatization of the telecom industry during the presidency of Olusegun Obasanjo. This opened the door for entities such as MTN, Glo, MTEL, 9Mobile, and Airtel (formerly Econet/V-Mobile/Celtel) to penetrate the Nigerian telecom space.

Their arrival proceeded the era that reduced the cost of calls and brought about other significant developments like the boom of the internet. In the early 2000s, access to the internet was not so widespread. The introduction of mobile operators, however, changed that as it pushed the rapid growth and adoption of the internet in Nigeria. The internet is the most important catalyst of tech in the 21st century. In Nigeria currently, there are 198.96 million GSM subscribers in the country. This is more than 90% of the country’s population. Internet subscribers are about 146.73 million.

Improved Healthcare: The coronavirus pandemic of 2020 showed that healthy economies depend on healthy populations. Before the pandemic, healthcare systems around the world were already under pressure due to rising costs and insufficient resources. This is where technology enters the equation. With several health startups and applications, health care services have become affordable and easily available. Millions of lives have been saved in Nigeria because of technological inputs into the field of medicine. Technology has a greatly refined diagnosis and has led to both prompt discoveries of diseases and commencement of treatment to give patients a fighting chance. There is also a massive improvement in treatment. Apart from research, technology has also been used to improve the day-to-day activities of hospitals. Several Health tech startups have sprung up to help hospitals digitize records and automate restocking for drugs. Some other startups have ventured into self-diagnostic software, virtual consultation apps among others.

Investments: Nigeria had the highest investment focus (about $109.3 million), accounting for 29% of the total investments in African startups. The likes of ToLet, IROKOtv,  Hotels.ng, Paystack, Flutterwave, Andela FarmCrowdy, and many others are examples that portray the pleasure of foreign recognition. Furthermore, investments in these startups are indications that foreign investors are not withdrawing their interest in Nigeria and Africa at large anytime soon. Focusing on how foreign investments rain on Nigerian startups, it is normal to expect a tremendous impact, a spontaneous positive turnaround in Nigeria’s ailing economy, and possibly the appreciation of its currency.

Technology is not only an important enabler of innovation and development. It is also one of the fastest-growing industries with the potential to revolutionize the Nigerian Economy. The influence of technology is immense and can’t be overstated. An innovative idea from one man not only contributes to the progress of others but also creates conditions permitting people to advance even further. Technology Innovations do not simply replace other products. Rather, they develop new and expanded markets of their own while benefiting the economy.