Contributions of the information and communications technology (ICT) sector to Nigeria’s gross domestic product (GDP) dropped from N8.4 trillion in Q4, 2023 to N7.9 trillion in Q1, 2024.Providing basis for the development, the document explained that GDP and the associated growth rate remain the most common metric for tracking economic performance.
The document noted that the assessment must be done using all the right indices and data to ensure a genuine and realistic view of economic performance over a period, which allows the government and citizens to properly evaluate the impact of ongoing initiatives, policies and help determine the need or otherwise for adjustments.He said a similar trend was also found in the telecommunication and information services sub-sector for the same period.
“However, it is important to note that despite this fall, the nominal value in Q1, 2024 is still 10.81 per cent higher than Q3, 2023, and also 14.18 per cent higher compared to the nominal GDP at the same period in Q1, 2023,” Tijani noted.“Understanding these differences, a comparison between nominal GDP values and GDP growth rate (in the period in review) establishes an improvement in nominal performance even with a reduced growth rate. It is important to also establish that a slower growth rate is not the same as a negative growth and the observed fall in growth rate extends to seven quarters back,” he stated.
The minister said upon assumption of office, there was a recognition of the need to emphatically address this steep fall in growth rate as indicated above, as well as other broader factors that were inhibiting the pace of growth of the sector including, tech brain drain, which created a shortage in the local technology workforce, particularly between 2021 and 2023; low ranking in the Trade Complexity Index as indicated in Nigeria’s 99th percentile ranking on the ECI Index; imbalance in the level of connectivity across Nigeria; low levels of digital literacy limiting people’s ability to consume digital and ICT products and services; decline in funding for tech startups from 2022 to 2023.
Others are the low level of local domiciliation of technology startups in Nigeria and the low percentage of local content in the ICT value chain.
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