In the recent decade, the internet has significantly impacted the Nigerian business environment. Almost every household in major Nigerian cities has someone running a successful internet-based business. The ever-increasing volume of e-commerce activities attests to the widespread impact.
Thousands of retail businesses would not exist today if it weren’t for the internet and e-commerce. Increased internet usage has opened up new opportunities for entrepreneurship and employment across the country. “According to a recent poll, 30-40% of our vendors indicated Jumia was where they started their business. Some sellers came to Jumia to expand their business,” said industry leader and Jumia Nigeria Chairwoman Juliet Anammah.
There’s still a lot more ground to cover in comparison to the overall goal. According to an Accenture analysis on Africa iGDP Forecast, the continent’s internet economy has the potential to contribute $180 billion by 2025, with a projected increase of up to $712 billion by 2050. The fact that companies in the internet sector, in general, have outperformed other sectors of the economy shows a pattern for the same.
According to the National Bureau of Statistics’ (NBS) recently released telecoms report, the number of Internet subscribers in Nigeria increased by 14.03 million in the fourth quarter of 2021 to 154.3 million, up from 140.28 million the previous quarter. Lagos, Kano, and Ogun State lead the way with 37.61 million subscriptions as of December 2021.
Industry experts have stressed that the major hurdle to enhancing internet connectivity in the country is building subsea cables, as there has been a shortage of fibre links and transmission. The Ministry of Communication and Digital Economy has confirmed plans to roll out a 5G network across the country by 2022. This is expected to bridge the infrastructure gap further, as more cables will be laid, which will lead to increased e-commerce activity in the country.
E-commerce-based businesses have been leading drivers of growth and diversification of Nigeria’s economy in the last decade. The sector is boosting the economy by increasing productivity, promoting innovation, improving knowledge management, educating customers and providing better shopping experiences. According to the International Trade Administration, the current e-commerce spending in Nigeria is estimated at $12 billion and is projected to reach an impressive $75 billion in revenues per annum by 2025.
While the major states are gaining more internet access, it is important to penetrate the secondary and rural communities. Investment in internet penetration to these communities will bring more Nigerians into the business world and propel the country towards achieving its 2030 digital economy projections.