Local content; how to encourage production and patronage of local content is probably one of the most talked about subject in Nigeria’s Information Communication Technology (ICT) sector.
Several seminars, conferences and ICT events have been held in the past few years, where industry stakeholders continue to clamor for the immediate implementation of Nigeria’s local content policy. In fact, the federal government, a few years ago, mandated that all government Ministries, Departments and Agencies (MDAs) use only locally developed or produced ICT solutions and equipment.
However, it has become apparent that the focus on ‘local content’ promotion is geared mainly towards software solutions while hardware production is still somewhat ignored, as Nigeria heavily depends on China for technology hardware supply.
Data from the National Information Technology Development Agency (NITDA) shows that Nigeria, with a population of over 180 million people has only about six functional local Original Equipment Manufacturers (OEMs). Listed on the NITDA website are; Brian, Zinox, VEDA, RLG global, BETA computers and Coscharis Technologies. Sadly, it seems that Omatek computers have stopped operating since the death of Florence Seriki, its founder and CEO.
This is a huge difference in numbers compared to the over 100 registered corporate members of software practitioners recorded by the Institution of Software Practitioners of Nigeria (ISPON) in 2017.
Interestingly, the African continent accounts for a significant portion of the world’s natural resources, much of which are used for the manufacturing of ICT devices. For instance, 71% of the world’s tantalum- a key resource for laptops and other electronics, comes from Africa. Many rechargeable batteries use cobalt and Africa accounts for 58% of the global production of cobalt and the list goes on. Nigeria is a gateway to sub-Saharan Africa. Our country is strategically located between West and Central Africa, and this gives investors easy access to close to 190 million Nigerians and another 200 million West Africans. However, the country and continent at large continues to heavily depend on importation of hardware technology.
Isa Ali Pantami made this disclosure while speaking at the GITEX 2018 technology conference in Dubai on Wednesday October 17, 2018, saying that as Nigeria starts to focus on growing the non-oil sector for the benefit of the economy, investors should take the opportunity to invest in the country’s ICT sector which has a ready pool of young “digital natives”.
“With a population having an average age of 18.2 years, Nigeria is the 22nd youngest country on earth. The youthfulness of our population is an asset and the fact that many young Nigerians are ICT enthusiasts even makes it better. Investors can be assured of accessing a large pool of youthful and skilful employees at a fair-price, more cost-effective that engaging employees in other parts of the world,” Pantami said.
African startups raised $560million in 2017 and Nigerian startups accounted for $114.6million of this amount. These investments and stories of innovation underscore the viability of the Nigerian startups and the capacity of Nigerians to conceive ingenious ideas. This amount of money would possible increase significantly, if hardware technology production gets just as much attention and focus as software production and export.
Paul Uzoechina, Admin Secretary, ISPON told BusinessDay that “the list of local software developing companies is quite exhaustive and a good number of applications developed by our members are currently used in banks, financial institutions, MDAs and other organisations.”
Apart from the earlier mentioned popular OEMs that assemble hardware technology in the country, smaller hardware focused startups have been stifled by several factors including government policies, funding, importation restrictions and the inability to produce refined inventions that meet global standards.
With the very few number of indigenous IT assemblers, it is no surprise that patronage of laptop and desktop computers and mobile phones is still largely foreign.
According to Pius Okigbo, Past President of ISPON, “We have to begin to look for a way to start manufacturing the basic components needed and there are a certain number of things that must be in place to help us begin that step of producing basic components.”
Okigbo told BusinessDay that, “the manufacturing of electronic components in Nigeria would still be a bit of a challenge because there are some things that are required like power which is an absolute necessity. For some of these equipments, you cannot turn on the system and there would be a power outage. We need 24 hours’ electricity generation, so until we can get steady power, then the government can begin to enforce the kind of electronics that can be manufactured locally.”
Earlier this year, Zinox Technologies Ltd announced its plans to expand its hardware assembly and production capacity with the acquisition of a 129,166.925 square feet warehouse in Ikeja Lagos.
The company also said that it was considering the deployment of robotics in handling the certification processes in the new assembly plant where devices of other multinational OEMs will be assembled in a bid to domesticate technology and generate employment opportunities for many unemployed but skilled Nigerians.
Although this new plan has been applauded by many industry stakeholders, as Zinox which has over the years endured the peculiar challenges that have stifled many businesses in Nigeria’s technology sector, will significantly boost its assembling capacity and target the future of technology by creating products for the savvy consumers in areas such as Internet of Things (IOTs), Robotics, Artificial Intelligence etc, some believe that the Nigerian market is mature enough to go beyond computer assembling.
Chijioke Anthony Eke, Co-founder, Sidmach Technologies, told BusinessDay in an interview a while ago that; “most people have smart phones and smart devices but none is made in Nigeria and the challenge before us is to find a way, over the next few years to begin to manufacture these devices, not just to assemble because we can see the effect of assembling.
“Those who assembled IT systems like servers, desktops, laptops are huffing and puffing because the market is not there. Someone needs to be in control. We must go beyond that with the active cooperation of government, and let them know that it is time to deliberately develop the indigenous IT market,” Eke added.
The NITDA DG continues to emphasize that our hardware sub-sector presents a very good investment opportunity.
The Ikeja Computer Village is the largest technology market cluster in West Africa and is estimated to contribute about $2billion to Nigeria’s economy annually.
“We currently have just seven local Original Equipment Manufacturers (OEMs) who can barely even meet 20% of the local demand for computer hardware by government alone, not to talk of the entire country. We are interested in investors willing to establish world class Original Design Manufacturing (ODM) factories in Nigeria to guarantee quality components for local assembly,” Pantami said.
Jumoke Akiyode-Lawanson
