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Igniting Innovation-Based Growth in Africa

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Tolu Oyekan Inclusive Economic Recovery

By Tolu Oyekan

Despite being the second largest continent by population and its huge landmarks, Africa still lags behind in several indicators vital for a successful industrial revolution. The region is still behind in the most important measures of innovation capacity.

Although Africa has 18% of the world’s population, it accounts for only 0.3% of global R&D spending and 0.5% of patent applications. Trade statistics paint a picture of a relatively low-tech, low value-add region: Africa produces 0.4% of global high-technology exports and 0.8% of middle-technology exports, such as industrial machinery, autos and chemicals.

Unlike previous waves of industrial change, competing in the digital age doesn’t require deep scientific expertise or massive capital investment. Instead, innovators and entrepreneurs in emerging markets are in a position to tap into flows of talent and digital knowledge; and convert them into novel goods, services and business models.

Specifically, Nigeria has been making steady progress in digitalization, technological advancement and innovation. The advent of the internet has impacted Nigeria positively; connecting businesses, individuals and enterprises in a seamless manner. Internet access and mobile phone usage have grown dramatically, as has Science, Technology, Engineering and Mathematics (STEM) education.

Nigeria has the potential to unleash innovation that could transform industries and improve well-being across the region. These innovations can be seen in the transport, health, education, payment and fintech sectors.

Nigerian startups have attracted hundreds of millions of dollars in equity funding. Voltron Capital is one of the well-known active investors in Nigeria tech startups and Africa at large.

Since its inception in 2014, it has invested in 33 startups. The Fintech (Financial technology) sector is one of the major and fastest-growing start-up ecosystems in Nigeria and these companies in Nigeria are driving tangible change for businesses.

According to a study by Boston Consulting Group (BCG), the number of African tech startups receiving funding between 2015 and 2020 increased by 46%, nearly six times faster than the global average.

However, the progress Africa has achieved has been concentrated in a handful of nations: Nigeria and five other African countries (Egypt, Kenya, Morocco, South Africa, and Tunisia.) These six countries account for half of all African mobile communication subscriptions, for example. Internet access and mobile phone usage have grown dramatically.

In 2021, Nigeria had 108.75 million internet users. This figure is projected to grow to 143.26 million internet users in 2026.  Four nations receive around 85% of the continent’s venture capital investments and 70% of STEM graduates.

South Africa, Egypt and Morocco account for 70% of public R&D spending in Africa. By their analysis, only two nations—South Africa and Kenya—have comprehensive regulations related to innovation.

In a recent report by BCG, Morocco’s 200-company automotive cluster is launching R&D initiatives linking manufacturers to universities and Kenya has emerged as a hotbed for fintech. South Africa’s dynamic health technology ecosystem includes more than 120 companies. Incubators, entrepreneurship training and investment funds are making Egypt the region’s fastest-growing startup ecosystem.

The good news is that talents in the region who are trained in the skills needed for fields like AI and advanced analytics are proving that they can integrate seamlessly into global value chains.

Freelance workers in such digital disciplines are in high demand, and the COVID-19 epidemic has made leading corporations far more receptive to remote work. This means that, for once, governments that invest in training can create jobs at home that will contribute to socio-economic development and innovation in Africa—rather than a brain drain.

Given the region’s diverse markets, there is no uniform approach to building and nurturing an innovation-driven economy that will work in all of Africa. The most appropriate strategies and mixes of policies will depend on which types of innovators—such as Multinational corporations, local champions, or startups—are being targeted.

There are, however, three basic steps that African governments need to follow to activate their national innovation system: build a national innovation strategy, stimulate domestic innovation activity, and enable the new national innovation ecosystem.

Building a National Innovation Strategy

Governments need to set their sights on innovation-driven fields that can create value well into the future by defining a national ambition and targeting priority innovation sectors. This can be done by considering the evolving opportunities in the emerging, digitally connected, Industry 4.0-driven global economy. Based on this analysis, policymakers should identify industrial sectors that are in the strongest position to achieve key national goals.

Nigeria has taken the initiative to adopt a National Strategy for the development and expansion of the tech ecosystem into communities, schools and innovation-driven enterprises (IDEs), thereby providing an opportunity for various sectors of the economy to leverage technology to transform business models, enhance productivity and efficiency; while also creating jobs and wealth for operators.

Stimulating Domestic Innovation Activity

To successfully launch different innovation clusters to stimulate innovation activity and attract foreign partners, African governments should provide operational, technical and financial support; encourage collaboration, invite open innovation and provide an innovation-friendly regulatory environment.

Enabling the New Innovation Ecosystem

A well-designed policy framework can lay the ground for a thriving innovation economy. But governments—especially in developing economies such as those in Africa—must also play a lead role in driving the investments that are needed to build innovation capacity.

Governments can leverage the success of leading-edge companies to support the development of innovation ecosystems by collaborating with the private sector to build supporting infrastructure, develop the talent pool and actively pursue and support pro-innovation investment.

While there is no single innovation strategy that can work across such a diverse region as Africa, the basic approach of defining national strategies, stimulating innovation activity and enabling the innovation system applies. Success in these areas will require collaboration among all actors in the innovation ecosystem: local companies, small entrepreneurs, academic institutions and investors. The specific policy formula should vary according to each country’s level of economic maturity, existing innovation capacity, competitive strengths, market ambitions and national needs.

As African nations continue to aggressively invest in their innovation capacity and implement the right blend of strategies and policies, we believe the continent is poised to write a new chapter in its economic history. But Africa should move now while there is still ample opportunity to get on the top deck with innovation cycles that are redefining the future.

Tolu Oyekan is a Partner at BCG

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National Albinism Day: AAN Reiterates Call for Inclusive Policy

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By Adedapo Adesanya

As Nigeria marks National Albinism Day, the Albinism Association of Nigeria (AAN) has reaffirmed its commitment to advocating for the rights, health, and inclusion of persons with albinism (PWAs), urging the government and relevant stakeholders to adopt inclusive policies that address their unique challenges.

Established in 2019, AAN has been at the forefront of championing the welfare of persons with albinism across the country. Through targeted advocacy, education, and partnerships, the association has significantly contributed to increased societal acceptance, reduced school drop-out rates among children with albinism, and greater attention to their health needs at national forums.

According to the organisation, this year’s theme, Protect Your Skin, Be Sun Smart underscores the pressing need to address the health vulnerabilities of PWAs, especially those resulting from sun exposure. Due to the absence of melanin—the natural pigment that protects the skin from harmful ultraviolet (UV) rays—persons with albinism are prone to painful sunburns, premature skin aging, vision problems, and an increased risk of skin cancer.

AAN emphasized preventive measures such as the regular use of broad-spectrum sunscreen (SPF 30 or higher), wearing protective clothing including wide-brimmed hats and sunglasses, avoiding peak sunlight hours, and seeking routine medical checkups for early detection of skin conditions.

In a statement shared with Business Post, Mrs Bisi Bamishe, National President of AAN, made a strong appeal to the government:

“We are calling on the Nigerian government to include sunscreen in the list of essential medicines under the National Health Insurance Scheme (NHIS). Sunscreen is not a luxury for persons with albinism—it is a necessity for survival.”

She further stressed the need for more tangible support

“Government should provide free or subsidized protective gear and health services to persons with albinism, especially in rural and underserved areas.”

Highlighting the importance of awareness and capacity building, Mrs. Bamishe said, “We urge health workers and teachers to receive proper training on the specific needs of persons with albinism. This will go a long way in improving service delivery and reducing stigma in schools and health centres.”

She also emphasized the importance of legal protections.

“The Discrimination Against Persons with Disabilities (Prohibition) Act must be enforced. It is not enough to have laws on paper; we need full implementation to ensure justice and inclusion.”

“We call for public education campaigns to reach deep into rural communities where harmful myths and stereotypes still persist. Awareness is key to acceptance.”

AAN also stressed the need for capacity building initiatives to empower community advocates and peer support systems.

As National Albinism Day is observed, AAN urges Nigerians to stand in solidarity with persons with albinism and work collectively to create a more inclusive, informed, and equitable society.

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Tinubu to Meet Gencos Tuesday Over N4trn Power Debt

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By Adedapo Adesanya

President Bola Tinubu will meet with the leadership of electricity-generating companies (GenCos) over the N4 trillion power sector debt on Tuesday, May 6.

This was disclosed by the Special Adviser on Strategic Communications and Media Relations to the Minister of Power, Mr Adebayo Adelabu, who noted that the federal government vowed to urgently address the debt following high-stakes talks between the Minister and chairmen of the power generators in Abuja recently.

He said FG’s intervention was aimed at averting an imminent collapse of the power infrastructure in the country.

Recall that the Minister also promised that the FG will pay 50 per cent of the debt recently.

According to the statement, the Minister assured the GenCos executives that the government would prioritise immediate payment of a significant amount out of the N4 trillion debt, while the balance would be defrayed through other debt instruments.

He said this would be proposed in a meeting being planned between President Tinubu and GenCos’ leadership.

“There is need to pay a substantial amount of the debt in cash. At the minimum, let us pay a substantial amount, then ask for a debt instrument in promissory notes to pay the rest,” he stated, assuring that the payment of the outstanding balance within six months through financial instruments such as promissory notes.

“We recognise the urgency of this matter. The government is committed to resolving this debt to stabilise the sector and prevent further crisis,” Mr Adelabu stated, adding that the President will meet with GenCos leadership to fast-track the process.

The GenCoS were led by the Chairman of Mainstream Energy Solutions, who is also the Chairman of the Association of Power Generating Companies (APGA), Mr Sani Bello, who had earlier sounded the alarm over the sector’s dire state, citing the N4 trillion debt as a critical threat to operations.

He also warned that liquidity challenges had left GenCos unable to secure loans or maintain infrastructure. “Without urgent intervention, the entire power ecosystem could collapse,” he stressed.

Mr Kola Adesina, Chairman of Egbin Power and First Independent Power Limited, echoed the urgency: “This is a national emergency. Everything hinges on power—industries, homes, hospitals. We cannot afford to let the sector fail.”

Mr Adelabu acknowledged the government’s role in the sector’s struggles, pledging to not only clear the debt but also implement reforms to ease operational bottlenecks. He emphasised the need for full liberalisation of the power sector, urging Nigerians to embrace cost-reflective tariffs.

“Citizens must pay the appropriate price for the energy consumed. The Federal Government will continue to provide targeted subsidies for economically disadvantaged Nigerians. We have to understand that our economy cannot sustain subsidies indefinitely,” he asserted, calling for public sensitisation campaigns to drive compliance.

On her part, Mrs Joy Ogaji, CEO of APGC Power, detailed systemic challenges undermining GenCos, including chronic payment defaults, erratic gas supply, and foreign exchange volatility.

She noted that the naira’s plunge from N157/$1 in 2013 to N1,600/$1 had devastated maintenance budgets and loan repayments.

“GenCos have borne unsustainable risks—from grid failures to unproductive taxes—while remaining patriotic,” she said.

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Nigerians Must Prepare for Another Electricity Tariff Hike—FG

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By Modupe Gbadeyanka

The Minister of Power, Mr Adebayo Adelabu, has advised Nigerians and electricity consumers in the country to brace up for another hike in tariff because the federal government is not buoyant enough to continue to bear the cost of subsidy on electricity.

Speaking at a meeting with the Chairmen of the Generating Companies of Nigeria (GenCos) in Abuja, Mr Adelabu said consumers will soon begin to pay cost-reflective tariffs.

At the moment, customers on Band B to E enjoyed subsidised electricity tariffs and pay between N68 per kilowatt per hour and 34 per kilowatt per hour (VAT inclusive), while those on Band A, who consume power for at least 20 hours per day, pay about N225 per kilowatt per hour (VAT inclusive).

At the meeting with the GenCos, the Minister hinted that consumers on Band B downward may have to pay more, which could match the Band A tariff.

“We have to understand that our economy cannot sustain subsidies indefinitely,” Mr Adelabu informed the chairmen without giving a specific time when a new rate will be announced.

During the meeting, the chairman of Egbin Power, Mr Kola Adesina, tasked the government to declare a state of emergency in the power sector, noting that the N4 trillion owed GenCos by the federal government remains a critical threat to their operations.

“This is a national emergency. Everything hinges on power—industries, homes, hospitals. We cannot afford to let the sector fail,” he stressed.

Also, the chairman of Mainstream Energy Solutions, Mr Sani Bello, warned that “without urgent intervention, the entire power ecosystem could collapse.”

In the same vein, the chief executive of the Association of Power Generating Companies (GenCos), Ms Joy Ogaji, said, “GenCos have borne unsustainable risks—from grid failures to unproductive taxes—while remaining patriotic.”

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