Stakeholders within Nigeria’s information technology space under an umbrella named Information technology association of Nigeria (ITAN) have raised concerns over the need for the government to extend keen concentration towards the ICT sector of the economy.
This they said is a call for the federal government of Nigeria to learn from other developed nations of the world towards using technology to drive economy growth and create enabling environment where technology companies can thrive amid headwinds.
“Today if you are not investing in technology, irrespective of the industry you are playing, then you are not moving. Hence the call for the government to create the right enabling environment for the IT companies to take up the challenge of our environment and create solutions to them,” Bonny Mekwunye, Vice chairman, Kecam technologies ltd and Chairman of Lagos chapter of ITAN.
A look into activities within the ICT sector as collated by the National Bureau of statistics revealed in Q1 2019, the industry recorded a slowdown in real GDP growth by -0.17 percentage points to 9.48 percent quarter on quarter against 9.65 in Q4 2018. This is the lowest in the last four quarters.
In addition, data collated from the World Bank Data Index (WDI) showed that Nigeria’s ICT goods imports as a percentage of total goods imports in 2017 plunged to 3.27 percent, down from all time high of 9.48 percent in 2008.
To buttress more on the dilapidated state of the sector, ICT goods exports as a percentage of total goods exports in 2017, continued an 18 year trend to stand at 0 percent, contributing almost nothing to exports.
“There should be tax holidays for new IT companies that are innovative with new products and services. Apart from TSA which is local, to what extent do we have the federal government maintain local contents in terms of ICT deployment,” Mekwunye told BusinessDay.
To this end, the president announced the body’s move to tighten partnership with the federal government to help unlock hidden potentials among IT companies within the ICT industry of the economy.
Speaking on the impact of the recently signed African free trade agreement bill by Muhammadu Buhari, Nigeria’s president, stakeholders within the ICT space speak on challenges this might pose to businesses within the sector.
“What the AFCTA signing implies is that a Kenyan software can be sold into Nigeria and vice versa, however, the Kenyan companies have a better cost comparative advantage compared to Nigeria on the back of incentives their government provide to developers which is not in existence here in Nigeria,” Mekwunye explained further.
Hence, stakeholders insist that to unlock benefits there must be in place the right infrastructures and incentives within the economy by the government so has not alleviate the possibility of Nigeria being a dumping ground and not being invaded by other African countries.
While this poses a threat to Nigerian companies, the information technology companies are not excluded either, the chairman noted.
Speaking on challenges smaller companies face in doing business with the federal government and policies ITAN intend to pursue in partnership with the government, the Chairman of the Lagos base chapter of ITAN raised issues around government criterias in doing business/awarding projects to companies.
With issues around PENCOM levies and length of existence, smaller companies have found it difficult to bid for on-going projects of the federal government.
In addition, Amos Emmanuel, Director Africa, global digital foundation, explained the need for the government to include in their budget preparation projects to undertake in the ICT space.
