Exploring Technology As the New Lubricant of Economic Growth
By Inyene Ibanga
Today, technology has become inevitable in our everyday lives. It is playing a very important role in how we live and communicate with everything around us. The reality is that the world we are living in is totally technology based.
The development of new technologies helps to save lives, improve work, enhance our daily life experiences and make the world more colourful. This is besides its power to set trends and effect changes.
Whether we accept it or not, technology, being an important part of modern life, has become integral to our daily lives and activities across developed and emerging economies.
Predictably, the director-general of National Information Technology Development Agency (NITDA), Mallam Kashifu Abdullahi, has declared that technology would emerge as the major driver of growth and development in information, communication, health, education, agriculture, and all other sectors of Nigeria’s economy.
Kashifu’s ‘prophesy’ that technology possesses the potential to propel the economy for successful implementation of a buoyant and robust digital economy, holds a special prospect that is worth exploiting.
This means that in no distant future, technology would overtake oil resources to become the major source of revenue for the country and the largest contributor to the Gross Domestic Product (GDP).
Now, a cursory look at the some of the leading global technology companies shows that they have been posting humongous annual revenues, higher than many countries’ national budgets.
Apple, Microsoft, Google, Tencent and Facebook are a few of the heavyweight technology companies in the world. They are raking in billions of dollars in revenue every year.
As at August this year, Apple’s annual revenue was around $260.2 billion; Google stood at $161.9 billion; Microsoft was about $143 billion and Facebook grossed $70.7 billion. Touted as leader in the e-commerce technology sector, Amazon’s revenue in the same period was $280.5 billion.
Evidently, the annual revenues of these tech companies are far above the 2020 national budget of Nigeria.
Africa, touted as the world’s fastest growing continent for software developers, is home to over 100 tech startups.
A report by investment banking firm, FT Partners Research (FTPR), rated Interswitch, Opay, Andela, Bboxx, Swvl, Retail Capital and Palmpay as the top seven African tech companies that raised the most capital in 2019.
According to the report, the capital raised are as follows: Interswitch – $200 million; Opay – $170 million; Andela – $100 million; Bbboxx – $81 million; Swvl – $42 million; Retail Capital -$41.7 million and Palmpay – $40 million.
Interestingly, Nigerian startups, Interswitch, Opay, Andela and Palmpay accounted for most of the venture deals on the continent in 2019.
Given this promising position, it is expected that more money would flow into the sector, because investors are beginning to pay more attention to African fintech, e-commerce, e-health, e-learning, logistics and agritec startups.
Aside Interswitch, Opay, Andela and Palmpay, Nigeria boasts of over 700 tech companies operating in various sectors of the economy such as agriculture, health, education, banking and finance, among others.
They include uLesson (edtech); Gradely (edtech); Flutterwave (fintech); Paystack (fintech); FarmCrowdy (agritech); ThriveAgric (agritech); LifeBank (e-health); MyClinic.ng (e-health); and Hotels.ng (online travels/tourism), just to name a few.
Overall, technology is enhancing the learning experience within and outside the classroom on e-learning and m-learning apps. It has improved all forms of communication, whether personal or business, through various apps such as Zoom, Skype and Voxer.
Family members living far away from one another now stay connected through social media platforms like Facebook, Twitter, Instagram, Snapchat and many others.
There are smart health apps that are dedicated to providing patients access to medical personnel from any location, and affordable medical services to help save human lives.
Technology provides some level of safety to businesses and families. Several security devices and software are now available to secure all forms of data and protect homes and other items, both at the personal and business levels.
Additionally, there has been an increase in the volume of products and services available for consumers.
Owing to the arrival of the COVID-19 pandemic, there is now a widespread acceptance of working from home, with flexible working hours. Many large companies operating in the digital economy have stated that their staff can work from home indefinitely.
Thanks to innovative technologies, there is no more commuting, more flexible hours, and being able to choose where to work from.
From the foregoing, it is evident that technology impacts virtually all sectors of the economy and the earlier Nigeria realises this fact, the better for the country’s future. And there could be no favourable time to get into action than now.
The strategic implementation of the digital economy is the key to sustainable diversification of the economy, through the addressing of the over-dependence on oil as the sole revenue earner for the country.
Emphasis must placed on the development of technological innovations that would help solve problems and open up other sources of wealth that had been abandoned following the discovery of oil.
Digital economy activities are key stimulants for systemic diversification, on the basis of abundant human and material resources. These resources should be channeled into software development that solves local economic problems, using local content.
The problems of inefficiency and low productivity would become a thing of the past as this process would not only facilitate knowledge expansion and education, but it would enable the further integration of Nigeria’s economy with the global economy.
Productivity, efficiency and flexibility will experience tremendous increase as a direct consequence of innovations and diversification of the economy.
By enhancing connectivity, financial inclusion, access to trade and public services, technology creates industries capable of producing more smartly, more quickly, more safely, and more cleanly, without harming the environment and the social space.
The role of NITDA would therefore be to ensure a regulatory environment that is supported with appropriate hardware infrastructure to enable tech startups thrive, as the world transits into the New Economy.
Also, it should make the necessary resources available to encourage new tech companies to fill up the sector with innovative solutions to the myriad of economic, social and political problems bedeviling the country.
The agency must remain committed to the implementation of its core mandates towards the successful transformation of Nigeria into a digital economy driven by knowledge and creative innovations.
Without doubt, Kashifu’s projection about the huge contribution that technology can bring to the economy is realistic and achievable. Nothing must stand on the way to making this projection become a practical reality.
Inyene Ibanga is Managing Editor TechDigest and writes from Wuye District, Abuja.