Nigeria’s federal government has launched an initiative to establish digital free zones in the country. These zones will be designed to attract and support tech, finance and service-orientated businesses in what is described as “a conducive environment tailored to the 21st-century digital trade and technological age”.
A government-led steering committee with representation from a number of ministries has been formed to enable this aim. It also includes the Initiative for the Promotion of Digital Free Zones in Nigeria (DiFZIN), a non-profit advocacy and policy research organisation, as the private-sector stakeholders’ representative and technical adviser on the committee. DiFZIN is supported by a consortium of private sector development-focused and advisory institutions.
The mission of the various players is an ambitious one: to develop Nigeria’s free zone ecosystem into Africa’s primary hub for global technology, finance, and service businesses – with the tax, banking and immigration incentives, as well as simplified government compliance processes and stable regulatory environment that would attract such businesses. The Nigerian Tribune reports that Digital Free Zones will leverage cutting-edge technologies like AI and edge computing.
The strategic goals of this initiative include boosting foreign direct investment, creating employment opportunities, and facilitating foreign exchange inflow through an innovative approach to the free zone ecosystem.
Precise logistical, legal and administrative details are not yet available, though there are clearly high hopes for this initiative. Mr Luqman Edu, Executive Director of DiFZIN, quoted in the Nigerian Tribune, refers to the creation of “a conducive environment for global technology, finance, and services-based businesses, positioning Nigeria as a hub for Africa.”
However, the Nigerian business environment was in the news for less positive reasons last week after Africa’s biggest telecoms operator MTN Group last week said it will suffer a half-year loss, hit by the devaluation of the Nigerian naira and operational challenges in Sudan.
The devaluation of the naira versus the US dollar drove higher operating and net finance costs for MTN Nigeria. Foreign exchange losses from the Nigerian unit also affected the company’s bottom line.
