The Progression to an Inclusive Digital Economy Requires a Risk Based Transition Plan
The fast growth of digital technology in Nigeria is rapidly transforming how citizens interact, learn, and trade. While this has opened up significant opportunities for Nigeria to lead a booming digital economy in Africa, it also poses inherent risks of exclusion and deepening inequalities if not well managed.
As the name implies, digital economy refers to the use of digital tools and resources for production, the purchase of goods and services, and accessing financial services. Digital tools and resources include websites, applications, the internet, smartphones, and other computer-based resources.
According to the World Bank’s Digital Economy High Level Scorecard (Version 1/1/2021), the foundations or pillars of the digital economy include: digital infrastructure, digital platforms, digital financial services, digital businesses, digital skills, and trust environments. Without the successful institutionalization and deployment of these pillars, no country can successfully transition into an inclusive digital economy.
As a result, the progression to an inclusive digital economy requires a transition plan that is risk-based and considers the different population segments, the likely impact of the transition, and mitigating actions. According to her, without digital and financial literacy, as well as the supporting digital infrastructure such as the availability of affordable internet broadband services and devices to connect, individuals cannot reap the benefits of the fast-growing digital economy and will remain excluded. According to the GSMA’s Consumer Survey 2021 report, women in rural areas in Nigeria lag significantly in terms of internet usage when compared to men and women in rural and urban areas. This shows that rural women face the risk of being excluded from the gains of the digital economy. While it may be difficult, if not impossible, to achieve equality of use and access across all segments of the population in Nigeria, a risk-based transition plan will foster a phased-out approach that considers the barriers and needs of each population segment with respect to their participation in the digital economy and deliberately channels resources to areas that face the highest risks.
Nigeria already has its own digital economy policy and strategy, and interestingly, the Digital Economy Community of Practice in Nigeria was also inaugurated on March 30, 2023. Key stakeholders are therefore hopeful that the Committee, working with relevant stakeholders including, will be instrumental in charting the course and leading Nigeria into a digital economy that is truly inclusive.
Written by: Imade Bibowei-Osuobeni, Founder, Tech Herfrica