With the emergence of digital technologies in Africa, governments are increasingly realizing the importance of the creative economy for generating business opportunities to positively impact lives and develop the economy in general.
The African Development Bank (AfDB), Islamic Development Bank (IDB) and French Development Agency (AFD) have invested $618 million in the Digital and Creative Enterprises (i-DICE) program in Nigeria.
Speaking this Thursday, September 22 in New York at the Nigeria International Economic Partnership Forum, AfDB President Akinwumi Adesina said that this financing will support the creation of 225 creative start-ups and 451 small and medium-sized enterprises (SMEs) in digital technologies.
“The future is not just digital, the future will be driven by the digital revolution […] Today, Nigeria has 5 out of 7 unicorns in Africa and has raised nearly $1.4 billion on the total of $4 billion raised by fintech companies in Africa in 2021,” said Akinwumi Adesina.
Funding for the program aims to offset the economic downturn due to the Covid-19 pandemic through the expansion of the financial and technology sectors in Nigeria. According to the AfDB, during the fourth quarter of 2020, ICT contributed 15.06% to gross domestic product (GDP), compared to 13% during the same quarter of 2019. Similarly, creative industries, very dynamic, generated $14.4 million in revenue between 2015 and 2018.
Despite these advances, several systemic problems including lack of financing, insufficient infrastructure, lack of skills, limited access to the Internet are obstacles to the development of these sectors. The Digital and Creative Enterprise Investment Program launched in January by the Federal Government of Nigeria aims to address these issues. It targets over 68 million Nigerians between the ages of 15 and 35 who are recognized as leaders of innovative, early-stage technology start-ups, but also leaders of micro, small and medium enterprises in the creative sector.
i-DICE’s bank financing is part of the government’s initiative to further cement Nigeria’s position as Africa’s premier investment destination for start-ups, and as a hub for youth entrepreneurship. According to the President of the AfDB, these companies could create 6.1 million jobs and contribute $6.4 billion to the economy by 2027.