The Nigerian government through the National Information Technology Development Agency (NITDA) has initiated a bold rescue plan to save the tech ecosystem from the devastating impact of the coronavirus pandemic.
But the plan is coming weeks after the coronavirus took a crushing toll on Nigeria’s economy which has left businesses of different sizes fighting for survival. For many people, a lockdown was a matter of ‘when’ and not ‘if’. The government made it official in Lagos, Abuja, and Ogun on the last Sunday of March, three days before NITDA set up its committee.
A lot was already happening with hundreds of tech businesses in Nigeria.
In an interview with Disrupt Africa, Tomi Davies, president of African Business Angels Network (ABAN) and who coincidentally is the chairman of the committee NITDA set up, said over 80 percent of start-ups in Africa are expected to fail as a result of the recession caused by the spread of the virus.
“Even high-quality startups are already having challenges raising equity financing and the resulting lack of working capital will mean having to lay off employees,” Davies said.
Start-ups have always been risky, designed to grow fast or die, but the coronavirus pandemic is turbocharging Nigeria’s tech ecosystem’s natural selection and causing a shake-up so sudden it has defied comparison.
NITDA had on 1 April, inaugurated a 10-Member Advisory Committee to advise Government on measures to be taken to cushion the impact of the COVID-19 pandemic on start-ups, small and medium businesses as well as the Technology Ecosystem in general.
The committee constitutes many of the prominent voices and leaders in the ecosystem. While inaugurating the committee, Kashifu Abdullahi, the director-general of NITDA said that members of the committee were carefully selected for their significant contributions to the ICT sector in general and the technology and innovation ecosystem in particular.
The committee was mandated to come up with a report in 48 hours, which they have since delivered.
According to a source who saw the report, there are about 20 recommendations that try to capture interventions for the short term and beyond the crisis.
One of the recommendations is a ‘digital first cloud-first’ strategy meant to encourage deeper automation in governance and support remote work in Nigeria. The committee has also recommended the inclusion of IT companies in all intervention funds by the Central Bank of Nigeria.
“There are some tech policies that have been signed but not operated; we are trying to get them implemented using this crisis,” said the source.
But how far is the government willing to go to save the ecosystem this time? The IMF predicts the coronavirus pandemic will trigger the worst global recession since the Great Depression in the 1930s.
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Prior to the pandemic, the government treated the ecosystem like a piece of decorative vase, only giving it attention when it needed to boast to neighbors or visitors of how innovative young people in the country had become.
Once in a while it threw money at it which helped a few well-connected tech firms to stay afloat. The rest clawed along, some have died while others who could afford the logistics set their hopes on Silicon Valley. As a result, nearly 90 percent of the funding tech firms have received so far have come from foreign investors. More importantly, the success the ecosystem has recorded so far is more thanks to the individual firms and the investors that saw their potential.
With coronavirus cases rising and spreading across the 36 states, the government may finally be convinced it can’t function in the 21st century without an efficient tech ecosystem driving it’s digital economy ambitions.
The country has 373 confirmed cases as of 09:20 pm, Tuesday, 14 April. 99 people have so far been discharged with 11 deaths recorded.
Governance is practically on lockdown with civil servants sent home to observe social distancing.
The government has had to fall back on tech products for meetings, communication, work monitoring, data collection, payments, and healthcare.
Tech start-ups have also become one of the most visible and relevant partners of government in the fight against the coronavirus pandemic. Quite a number of them, Lifebank, Ventures Platform, Hotels.ng, CcHUB, 54gene, etc, have brought innovative approaches to problem-solving in the crisis.
Hence, the government needs to go deeper than making promises. One of the short wins that have come out of the latest plan to rescue start-ups, is at the instance of the minister of Communication and Digital Economy, the compilation of a list of tech start-ups providing essential services. Due to the list, workers in agritech and edtech firms considered essential are able to provide their services without restrictions to movement.
While this is commendable, it would only be cosmetic if it doesn’t address, once and for all, the wider issue of police harassment that workers in the ecosystem face daily pre-COVID-19. Hence, it would probably have made better sense to have a representative of the police as part of the committee.
The question could also be asked where the government hopes to get the money it wants to use and save firms in the ecosystem given that the CBN already itemised the industries that will receive its over N2.1 trillion palliative.
“Anyone that we can pull through is a plus for the industry,” said a member of the committee who pleaded anonymity.
