Wednesday, June 09, 2021 /5:36 PM / NESG /
Header Image Credit: Ecographics
As in other economies worldwide, the COVID-19 pandemic has had a tremendous impact on the Nigerian economy. In 2020, Nigeria slipped into its second recession in five years, with a GDP contraction of 3.6% in the third quarter of 2020.
Unemployment rate rose to 33.3% in the fourth quarter of 2020, about 8.6 million Nigerians were estimated to have fallen into poverty in 2020, and about 13 million children were out of school. Despite its negative impact, COVID-19 has accelerated the embrace of digital technologies in our everyday lives.
According to the National Bureau of Statistics (despite the contraction of our economy), ICT and Finance emerged as two of the few growth sectors in 2020 and were the fastest-growing, with growth rates of 12.9% and 9.4%, respectively. This means that the digital sector remains crucial in accelerating Nigeria's recovery from the devastating impacts of the pandemic.
In the last two years, Nigerian startups have raised approximately US$498 million, according to Techpoint Africa. Specifically, in the FINTECH industry, Nigeria remains one of the most attractive markets in the African continent, attracting US$122 million in 2019, representing 24.8% of total investment in the continent, according to the 2019 African Tech Startups Funding Report. The industry has seen the entrants of companies and the rise of digital entrepreneurs who have continuously created value for brands, clients and other stakeholders.
For many of these businesses, social media platforms have become a veritable tool for engaging existing and potential clients over the years. As a result, platforms like Twitter which has about 17 million active users in Nigeria, have become a community for businesses and clients to exchange ideas, share progress, and address complaints towards optimal service delivery. Likewise, the digital marketing and e-commerce space has unveiled new markets for many Nigerian companies, particularly among the youth, many of whom have an active online presence. The contribution of these companies to job creation, value addition and the economy has been salutary.
Despite the inflow of investment into the digital economy, overall Foreign Direct Investment (FDI) inflow into Nigeria is yet to achieve its true potential. In the last five years, FDI inflows into Nigeria has remained around US$1billion, according to data from the NBS.
This amount is meagre compared with the inflows of countries such as Egypt, South Africa, and Indonesia. At a difficult time like this, when Nigeria must grow its economy, plug into the global digital revolution, attract patient international capital and sustained foreign currency inflow to address our foreign exchange challenges, the temporary suspension of Twitter in Nigeria sends out a wrong signal and will stand in the way of our path to rapid economic recovery.
In addition to the negative effect of the suspension on investments, small businesses that engage in digital trade will be gravely affected, raising further concerns on unemployment, poverty, insecurity, and our economy's attractiveness.
Against this background, the NESG urges the Federal Government to reconsider this decision and rescind the suspension to foster inclusive development, global competitiveness, and much faster economic growth in Nigeria.
You can also subscribe to our NEWSLETTER here
Related to Twitter's Suspension
Related News On Twitter
Related News on Digital Economy
Related News on Politics
Related News on Regulations on Communications and Social Media
Related News on Governance and Nigeria's Future
1. Igboro ti Daru: Governance, Leadership, Ethics - How to Build A Thriving Nigerian Economy - Olufemi Awoyemi, Proshare, June 29, 2019
2. Beyond Politics - A Government Within A Government Has Always Existed - Olufemi Awoyemi, Proshare, August 08, 2018
3. Ogun Standard Education: A Way Forward - Olufemi AWOYEMI - Proshare, May 23, 2017
4. Leadership, Change and Corporate Transformation - The Nigerian Experience - Olufemi Awoyemi, Proshare, November 07, 2017
5. A Village Made Me - Our Collective Story of Humble Beginnings - Olufemi Awoyemi, Proshare, December 11, 2019
6. Memo To The Market - The NSE, Oscar Onyema Foundation And Corporate Governance - Olufemi Awoyemi, Proshare, August 20, 2018
7. Where Nigeria got it Wrong - Olufemi Awoyemi, Proshare, December 01, 2014
8. The Case Against High Interest Rates in Time of Contagion - Bola Tinubu - Bola Ahmed Tinubu, Proshare, May 03, 2020
9. Nigeria's Economy After Oil: How Should We Prepare? - Bode Agusto, Proshare, April 24, 2020
10. Nigeria - How to Win - Bode Agusto, Proshare, April 16, 2018
11. Can Africa Afford COVID-19 Lockdowns? - Chukwuma Soludo, Proshare, April 24, 2020
12. Economic and Institutional Restructuring for the Next Nigeria - Soludo - Chukwuma Soludo, Proshare, October 01, 2019
13. Nigeria: Where is the New Economy? - Chukwuma Soludo, Proshare, August 20, 2012
14. Full Transcript of Professor Charles Soludo's lecture at the APC ... - Chukwuma Soludo, Proshare, September 05, 2016
15. Reconstructing Nigeria for Prosperity (1) - Chukwuma Soludo, Proshare, September 03, 2012
16. Reconstructing Nigeria for Prosperity (2) - Chukwuma Soludo, Proshare, September 17, 2012
17. Reconstructing Nigeria for Prosperity (3) - Proshare Nigeria - Chukwuma Soludo, Proshare, October 02, 2012
18. The Hard Facts to Rescue the Nigerian Economy ... - Apr 5, 2017 - Chukwuma Soludo, Proshare, April 05, 2017
19. PDF -Soludo on Buharinomics: Lecture Paper - Proshare - November 19, 2015
20. The Quadrilemma of Buharinomics - Temitope Oshikoya - June 03, 2015