The Nigerian Economic Summit Group (NESG) has said that the banning of Twitter in Nigeria will stand against the recovery of the Nigerian economy because it would gravely affect the nation’s digital economy which grew by 6.47 per cent in the first quarter of 2021.
Nigeria’s economy exited recession in the fourth quarter of 2020 with a fragile growth rate of 0.11 per cent. According to the National Bureau of Statistics (despite the contraction of our economy), information and communication technology as well as finance emerged as two of the few growth sectors in 2020, and were the fastest-growing, with growth rates of 12.9 per cent and 9.4 per cent respectively. This means that the digital sector remains crucial in accelerating Nigeria’s recovery from the devastating impact of the Covid-19 pandemic.
“At a difficult time like this, when Nigeria must grow its economy, plug into the global digital revolution, attract 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,” chief executive officer of the NESG, Mr. ‘Laoye Jaiyeola, said in a statement that was issued yesterday.
NESG noted that in addition to the negative effect of the suspension on investments, small businesses that engage in digital trade would be gravely affected, raising further concerns on unemployment, poverty, insecurity and the attractiveness of Nigeria’s economy.
NESG said there is a need to embrace and support the digital economy by lifting the ban on Twitter to allow for business operations in the technology sector of the economy to thrive for job and wealth creation.
“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,” Jaiyeola said.
Nigeria’s unemployment rate rose to 33.3 per cent 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 life,” NESG said.
In the last two years, Nigerian startups have raised approximately $498 million, according to Techpoint Africa. Specifically, in the FINTECH industry, Nigeria remains one of the most attractive markets in the African continent, attracting $122 million in 2019, representing 24.8 per cent 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.
NESG maintained that 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.”
Jaiyeola further said that the digital marketing and e-commerce space have 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, he said.
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 $1billion, according to data from the NBS. This amount is meagre compared with the inflows of countries such as Egypt, South Africa and Indonesia.