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Nigerian Startup Bill to unlock millions of dollars in foreign direct investment

Nigerian Startup Bill to unlock millions of dollars in foreign direct investment

The presidency and leaders of the Nigerian technology industry has quickened plans to make the Nigerian Start-up Bill (NSB) which will ensure regulatory support as Nigeria continues to attract millions of dollars in international investment, a reality.

Nigeria Startup Bill project is a joint initiative by Nigeria’s tech startup ecosystem and the Presidency to harness the potential of the country’s digital economy through co-created regulations. The Bill will ensure that Nigeria’s laws and regulations are friendly, clear, planned and work for the tech ecosystem.

Leaders of the Nigerian technology industry and the presidency have worked on the bill which has now been approved by the Federal Executive Council (FEC), on 15 December 2021, and been sent to the National Assembly by President Muhammadu Buhari for approval.

According to promoters of NSB, it has been able to progress through close collaboration between the presidency, the Federal Ministry of Communication and Digital economy, the Nigerian export and promotion council and wilder government bodies with almost 300 volunteers and private sector players participating.

Promoters noted that, In just two decades Nigeria has raised two indigenous unicorns despite the country’s infrastructure and regulation not keeping up with the pace of disruption by the tech sector while serving as the key market for five of the continent’s unicorns (Interswitch, Andela, Jumia, Opay and Flutterwave) and is the giant of African tech in terms of the country’s ability to attract investment.

Read also: Venture Platform closes first leg of $40m fund to invest in African startups

They explained that between 2016 and 2020 Nigerian startups were the most funded on the continent, raising $1.58 billion in venture capital and representing 27 percent of the overall deal volume, closely followed by Kenya. The NSB is expected to accelerate this progress and lead to many more Nigerian unicorns in years to come.

Adaeze Sokan, Country Director at UK-Nigeria Tech Hub, while speaking on NSB progress said “the inclusive and collaborative process is laudable and can serve as a framework for policy formulation in the country”

According to her, NSB aims to provide a platform where start-ups can continuously engage regulators and the key objectives include regulatory certainty, local content and enabling a business environment.

She explained that there will be more support for local Angel investors, funds and incubators and national co-investment schemes as well as investing in early stage start-ups.

“The NSB is one among a series of key activities the Presidency is using to drive the building of a more sustainable ecosystem for young people in Nigeria to thrive and scale,” Oswald Osaretin Guobadia, Senior Special Assistant to the President on Digital Transformation said.

Kola Aina, Founder and General Partner of Ventures Platform Fund added that the bill will solve the problem of strict regulation in the Startup sector.

“The bill is being proposed to provide an enabling environment for the growth of startups and guard against different challenges faced by startups such as seemingly disruptive regulations, lack of regulatory certainty and weak infrastructure like broadband, open data, and digital platforms that limit the optimization of the many benefits of the digital economy,” Aina said.

Meanwhile, promoters states that securing jobs for Nigeria’s youthful population is a key challenge for the government, and the NSB is aimed directly at fostering new talent in the growing technology sectors and providing for regulation around Startup registration, tax incentives, talent development, university-industry collaboration, and increased public tech procurement, the NSB will ease barriers to entrepreneurship and innovation.