Nigeria has emerged as the country with the highest funding provided to artificial intelligence (AI) companies in sub-Saharan Africa, indicating strong investor confidence and potential for scaling AI innovation, a new report has disclosed.
Boston Consulting Group (BCG), a management consulting solution team, explained that with substantial funding and a robust talent pool, Nigeria is poised for AI-driven economic transformation, adding that Nigeria has the second-highest number of AI specialists in sub-Saharan Africa, after South Africa, showcasing a robust and growing talent base.
In its report, BCG noted that AI is already transforming industries and starting to reshape economies and is poised to shape the future of economic development over the next few years.
“The expansive scale of this growth makes AI an economic priority in every region around the globe,” the report said. However, the BCG research has established that most economies are underprepared for AI-driven disruption, as the study shows that over 70 per cent of the economies studied, scored below average in critical areas such as ecosystem participation, skills, and research and development.
BCG’s AI Maturity Matrix, a first-of-its-kind study, offers a comprehensive overview of the AI landscape across 73 economies by focusing on two pivotal aspects. First, it assesses each economy’s vulnerability to AI-driven shifts, such as job displacement and industry-wide productivity gains. Second, it evaluates the preparedness of each economy to navigate the risks associated with AI, while leveraging its potential to stimulate economic growth.
The report offered recommendations tailored to the diverse groups to guide policymakers and provided an interactive dashboard for a more detailed exploration of the analysis.
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The first-of-its-kind study offered a broad view of global adoption, revealing that while most economies are gradually embracing AI, a small influential group of pioneers is emerging as global leaders. The handful of leading markets, according to the report, will stand to gain significant economic advantages and are uniquely positioned to shape how humanity will engage with this transformative technology.
The report listed six sectors that were most exposed to AI-driven changes to include: information and communication, high-tech goods, retail, financial services, public services, and motor vehicle manufacturing.
“Economies with a high share of sectors that are most exposed to AI are among the world’s most exposed to disruption. These include Luxembourg (with financial services making up almost 30 percent of GDP), Hong Kong (22 percent financial services and 22 percent business services), and Singapore (18 percent business services, 16 percent retail, and 14 percent financial services),” the report said.
The report noted that different sectors of Nigeria’s GDP are exposed to AI in varying degrees. Those with high exposure include retail and wholesale and information and communication constitute a large share of the country’s GDP, 18 percent and 17 percent respectively.
Agriculture, forestry, and fishery, which make up 23 percent of the economy, have limited AI exposure. “This aligns with the wider report findings that show that economies with industry sectors that are less susceptible to AI disruption are less exposed. Such sectors include construction, agriculture, and furniture manufacturing.
“The countries include Indonesia (13 percent agriculture and 11 percent construction of GDP), India (17 percent agriculture and eight percent construction), and Ethiopia (36 percent agriculture),” the report added.
