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Creating Conditions for Sustainable and Inclusive Growth in Nigeria’s Digital Economy – An Urgent Call for Action
By Engr. Gbenga Adebayo
The renewed Hope Agenda clearly recognizes the power of technology and innovation to enable inclusive economic growth and development. It is an important acknowledgement that if we can create the conditions within which innovation can thrive, we can maintain, or even accelerate the already rapid growth in the digital economy.
Since the liberalisation of the telecoms sector in the early 2000s, the ICT sector’s contribution to GDP in Nigeria has grown progressively. Today, it delivers 17.89% of annual GDP. That is more than double the contribution of oil and gas. From the initial development of connectivity infrastructure and services, the sector has catalysed the emergence of innovative technology businesses across a range of sectors. From financial technology, to data, logistics, transportation, healthcare and education.
It also provides the infrastructure that enables the delivery of critical national development projects, from national identity enrollment and management, to elections and financial inclusion programmes that provide access to vital services for marginalised and vulnerable communities.
While this growth is impressive and the impact on socio-economic development so far has been clear, the journey is far from over. The recognition within the renewed hope agenda is that the sector has the potential to drive a new wave of inclusive economic development that can be the foundation of Nigeria’s economy for decades.
To deliver this, the government has clearly and publicly acknowledged the importance of creating an enabling environment for investment and taken a number of bold steps to address investment bottlenecks. From the tough decisions to unify the exchange rates, to the tightening of monetary policy and a focus on reviewing the tax regime to make it smoother and more efficient. They have also created target investment funds to support key sectors of the economy, from healthcare and agriculture to the small businesses that drive the economy.
The specific role of the digital economy is captured in the Federal Ministry of Communications, Innovation and Digital Economy’s 4 year 2023-27 growth plan, which envisages a further 15% increase in the contribution of the ICT sector to GDP growth, as well as 15% YoY increases in investment in the sector, both of which are projected to support a 100% increase in the annual net revenue that the sector delivers to government.
These are laudable and ambitious objectives, but they are impossible to achieve without deliberate sustained strategic and tactical action. If these actions are not taken, then the foundations that have been built are vulnerable and not only will these objectives be missed, but the industry will stagnate.
If you look carefully at the investment trajectory in the telecoms industry you can see two clear and concerning trends, which are being further exacerbated by the recent short term economic shocks. Between 2021 and 2022 industry CAPEX declined by 30.37% while industry Foreign Direct Investment declined by 46.9%. This happened at a time when operational expenses have surged and it has been exacerbated more recently by rising interest rates increasing the cost of debt. What that means is that industry expenditure has been diverted from capital (expansion and growth) to operations and that the investment environment has deteriorated. The ultimate manifestation of this has been the recent losses declared by major operators for FY 2023 and HY 2024.
This is further exacerbated by the multiple taxation ecosystem that continues to exist across Nigeria, with operators exposed to 54 different federal/state/local government taxies or levies, many of which are technically illegal. There is a perception that the telecoms industry is highly profitable and so can be treated as a ‘cash cow’ – we are now seeing the impact of this, and even though it is clear operators are suffering, more new taxes continue to be considered by the national assembly.
This is a critical moment. It is an inflection point. If we act, we can establish the platform for growth and the delivery of the government’s ambitious objectives. If we delay, or fail to take the decisions necessary, then the industry is likely to go in the wrong direction. This will not only damage the interests of investors, many of whom are Nigerian, but also impact the emergence of the innovative services and products that ride on telecoms infrastructure.
We believe that decisive action can turn this moment from a crisis into an opportunity. Following extensive research, the Association of Licensed Telecom Operators of Nigeria (ALTON), has developed a clear set of recommendations that can catalyse the next wave of growth in the industry, and for Nigeria. These are:
- Take immediate action on retail pricing: In the short term, this means an industry wide increase to retail tariffs, which were last reviewed in 2016, when the exchange rate was N373/$ and inflation at 18.4%. No industry can survive indefinitely in a rapid inflation environment and not be allowed to increase retail prices. Regulators have denied all recent requests, despite approvals being granted in other critical industries from power to fuel and transportation.
- Make industry pricing sustainable: Every price increase requires individual pre-approval from the regulator, which continues to use 2016 pricing guidance. This is an outdated regulatory model that is not representative of global best practice. ALTON recommends the implementation of a general authorization regime for tariff administration under which the NCC sets general pricing principles and requirements and operators independently align their tariffs with the set pricing requirements through self-certification, eliminating the need for prior approval.
- Provide concessionary funding to enable CAPEX investment: To continue to drive investment and growth in infrastructure, the industry needs access to concessionary finance. Establishing a dedicated financing facility will help mitigate the impact of recent interest rate increases and enable more investment.
- Build and expand regulatory capacity: With technology driving rapid change, we need to rapidly upskill the sector’s regulators to ensure the implementation of well structured regulation that provides the right balance between protection and investment incentive. Regulations need to be co-developed more constructively with industry on a regular basis.
If we can deliver each of these things, then we will have established the basis for long-term sustainable growth in the telecoms sector, and through it catalyse dynamic growth in Nigeria’s broader digital economy. This is achievable, and the time is now.
Engr. Adebayo is the Chairman of the Association of Licensed Telecom Operators of Nigeria (ALTON)
Mastercard has today released its latest whitepaper, Harnessing the transformative power of AI in Africa, a pan-African study of the continent’s readiness, opportunity and roadmap for responsible artificial intelligence (AI) adoption.
Mark Elliott, Division President, Africa at Mastercard (L) and Ambassador Philip Thigo, Special Envoy on Technology in Kenya (R), at the official launch of the Mastercard whitepaper which provides insights on harnessing the power of AI in driving digital transformation
The whitepaper provides detailed insights into how AI—if deployed responsibly and inclusively—can unlock transformative outcomes across the continent’s major industries, including agriculture, healthcare, education, energy and finance.
With Africa’s AI market projected to grow from USD 4.5 billion in 2025 to USD 16.5 billion by 2030 according to a recent report from Statista, the paper presents a clear case for multi-stakeholder collaboration and investment. It highlights how Africa’s unique demographics, mobile-first infrastructure and entrepreneurial spirit position it as an active architect of the future.
Mark Elliott, division president, Africa at Mastercard, commented: “Africa’s engagement with AI is already reshaping lives — not just in labs, but in farms, clinics and classrooms. To unlock its full potential, we need investment in infrastructure, data, talent, and policy. At Mastercard, we believe responsible, locally rooted AI can drive inclusive growth and connect more people to opportunity.”
The whitepaper outlines the potential positive impact of AI on digital infrastructure, policy and governance, research and development, local language processing and investment into Africa.
It also explores how AI can accelerate job creation, with up to 230 million digital jobs projected by 2030 and increase access to formal finance through AI-enabled credit scoring and fraud prevention.
Greg Ulrich, chief AI and data officer, Mastercard, said: “AI is only as powerful as the trust behind it. At Mastercard, we’re committed to building AI that’s responsible, inclusive, and built to bring value to our customers, partners and employees. This isn’t just innovation—it’s innovation with integrity.”
Regional highlights covered in the whitepaper include:
South Africa: South Africa attracted USD 610 million in AI-focused venture capital in 2023, with total AI investment expected to reach USD 3.7 billion by 2030. With the highest data and infrastructure readiness in Africa, the country is solidifying its role as a continental leader in AI research and application. It is home to the Artificial Intelligence Institute of South Africa which serves as a gateway for students and professionals to access world-class education, research and industry news. National plans aim to develop up to 300 AI start-ups and train 5,000 AI professionals by 2030, creating the foundation for a vibrant, homegrown AI ecosystem.
Kenya: An emerging leader in AI innovation, Kenya has leveraged its “Silicon Savannah” status to securely deploy AI across sectors. Platforms like Tala use mobile data for credit scoring, while Jacaranda Health’s UlizaLlama, an AI-powered chatbot, provides maternal health support in five local languages. The newly launched National AI Strategy (2025–2030) outlines the government’s commitment to positioning Kenya as a regional leader in AI research and development, innovation and commercialization for socioeconomic development.
Nigeria: Nigeria ranks second in the number of AI startups in Africa and secured USD 218 million in VC investment in 2023. As one of Africa’s most dynamic AI ecosystems, Nigeria is using AI to personalize learning (Rising Academies), deliver microfinance via Kudi.ai, and strengthen governance with AI tools that monitor public fund allocation. With a $1.4 billion projected AI market size by 2025, the government’s proactive approach, combined with growing private-sector innovation, suggests promising growth in AI applications.
Morocco: An emerging AI hub in North Africa, Morocco is advancing AI adoption across healthcare, energy, agriculture, and finance. Institutions such as Mohammed VI Polytechnic University and DeepEcho are driving local innovation, while the MoroccoAI Annual Conference is shaping national dialogue on the future of AI. Under its Digital 2030 strategy, Morocco aims to attract USD 1.1 billion in investment and create 240,000 digital jobs by 2030. Despite this progress, the whitepaper warns that data fragmentation, language exclusion and regulatory inconsistency could deepen the digital divide.
Harnessing the potential of AI in Africa will be instrumental in accelerating financial inclusion and driving the continent’s digital and economic growth. Strategic collaborations between governments, fintechs, and global partners will be key to unlocking AI’s full impact.
Mastercard’s whitepaper draws on insights from leading African technologists, policymakers, academics and entrepreneurs, including interviews with UNESCO, the African Center for Economic Transformation, and fintech leaders across the region.
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IFC Strengthens Support for Africa’s Creative Economy with Investment in Filmmakers Market
To enhance access to production services in Africa’s film and entertainment industry, IFC announced an investment into Filmmakers Mart (FMM), Africa’s first integrated digital production platform.
FMM connects creatives to essential production services including location scouting, logistics coordination, catering, and permit acquisition through a centralized system.
It replaces fragmented service sourcing with a cost-effective, time-saving model, using AI-powered tools and automated workflows to enhance service quality and ensure access to vetted providers and filming locations.
IFC’s investment will support FMM to expand from its current markets in Nigeria, Kenya, Ghana, Morocco and South Africa into new markets. It will also fund the development of new platform features, including subscription models, post-production tools, and training programs designed to serve a growing community of creators.
The partnership will help strengthen Africa’s creative economy, helping creative professionals overcome the access to market barriers faced by so many on the continent.
This marks IFC’s first investment in Nigeria’s audiovisual sector and its first co-investment with Sony Innovation Fund Africa.
“We’re building the operating system for the creative industries in emerging markets; an ecosystem of interconnected tools and services designed to eliminate friction, unlock collaboration, and scale access to opportunities for creatives and entertainment businesses,” said Eric Kafui Okyerefo, CEO, Filmmakers Mart.
“Having IFC and Sony Ventures as strategic partners strongly validates this vision. Their support enables us to deepen our impact, expand globally, and continue solving the structural challenges faced by storytellers and producers in these markets.”
Sony Innovation Fund’s investment will provide FMM with access to its global network and industry expertise in content distribution, helping the platform strengthen its market position.
“At Sony Innovation Fund, we are committed to supporting technologies and platforms that empower creators and drive its growth,” said Antonio Avitabile, Managing Director, Sony Ventures, EMEA. “Filmmakers Mart is addressing real infrastructure gaps in Africa’s production ecosystem with a smart, scalable solution. We’re proud to partner with IFC on this investment, and excited to help FMM unlock new opportunities for the region’s vibrant creative community.”
“Africa’s film and entertainment sector is brimming with talent, but talent alone is not enough. It needs the right tools, platforms, and investment to thrive,” said Dahlia Khalifa, IFC Regional Director for Central Africa and Anglophone West Africa. “Our partnership with Sony to support Filmmakers Mart reflects IFC’s commitment to harnessing technology and innovation to support Africa’s creative industries and help scale opportunities for the next generation of storytellers across the continent.”
This partnership, which is helping more women, young people, and underrepresented groups earn incomes and grow sustainable businesses within the digital creative economy, bolsters IFC’s broader aims to create jobs, foster inclusion, and support digital innovation across Africa.
Accurate and timely payroll impacts costs, tax compliance, and employee morale. Many organisations assume that insourced payroll is inherently superior. Yet in today’s dynamic business environment, this assumption can be more costly. It can burden valuable personnel, increase compliance risks, and saddle organisations with expensive, yet obsolete, software.
Workplaces are becoming more complex through a wide variety of employment conditions, frequent regulation changes, and growth risks (especially when operating in multiple regions). Payroll systems don’t always keep up, which is why over a third of companies are dissatisfied with their internal payroll systems.
“The importance of accurate and timely payroll is undeniable. But assuming that insourcing payroll is inherently superior misses the mark. In today’s dynamic business environment, clinging to outdated internal systems is costly, diverts valuable personnel, and complicates software management,” says Heinrich Swanepoel, Head of Business Development at Deel Local Payroll, powered by PaySpace.
Outsourced payroll’s strategic advantages
Outsourcing payroll is a strategic move that adds scale and flexibility to an organisation’s operations. Whether it’s for five or five thousand employees, one office or multiple countries, using an experienced and technologically capable outsourced payroll provider creates crucial advantages in workforce management and adaptability.
Here are five key reasons why payroll outsourcing is a game-changer:
- Remove Legacy System Limitations and Costs: Outdated payroll software an expose you to delays, errors, and fragmented workflows. Outsourcing with modern technology provides flexibility. Providers can efficiently handle payroll tasks regardless of onboarding surges, market expansions, or workforce adjustments.
- Empower Staff for Higher-Impact Work: Outsourced experts add knowledge, coupled with payroll automation, secure collaboration tools, data integration, and enhanced financial visibility. They help key personnel in payroll, HR, and finance to focus on strategic, high-value priorities.
- Navigate Payroll Compliance: Outsourcing specialists make it their business to know local and international tax rules, labour laws, and data regulations. They use software with built-in compliance checks, audit trails, and secure document tracking. The provider shares and even inherits the responsibility of payroll software compliance such as GDPR, POPIA, SOC 1 & 2, and ISO 27001.
- Flexible payroll management: Outsourced payroll providers use scalable and flexible software to align with organisational changes, enabling their clients to adapt without reconfiguring payroll departments with restructuring or new hires.
- Access Advanced Features: Keeping up with new features and aligning them with operations is expensive and disruptive. Outsourced payroll providers introduce cutting-edge technologies like cloud computing, artificial intelligence, and data analytics as part of their core business strategies. They offer seamless integration with client business systems for real-time, fully compliant payroll operations that the client controls without adding technical risks.
Evaluating an outsourced payroll partner
Outsourcing payroll creates huge advantages. But not all outsourced payroll providers are the same. The best candidates combine human expertise with the advantages of modern cloud-native payroll platforms.
To evaluate a provider, test their payroll expertise and compliance knowledge. Security and data protection are non-negotiable, and assess their track record with other clients. Look at what software they use—the capabilities of the software and how well their people can use those features are as important as the staff’s professional capabilities. Are they masters of their tools as well as their craft?
Interrogate their service levels and how they extend capabilities to clients, such as self-service and ad hoc reporting. Evaluate the technology platform in terms of real-time data access, automated calculations, integration with HR and accounting tools, and compliance.
“Outsourcing payroll isn’t just about saving time — it’s a strategic move that positions your business for growth, compliance, and agility,” says Swanepoel. “With the right partner, you can reduce costs, streamline operations, and focus your energy where it matters most: on your people and your business.”
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