Teezee Elderly Care founder obtains N15million from Heritage Bank

By Tolu Oyekan

Despite being the second largest continent in terms of population and its immense landmarks, Africa still lags behind in several indicators vital for a successful industrial revolution. The region still lags behind in the most important measures of innovation capacity.

Although Africa has 18% of the world’s population, it only accounts for 0.3% of global R&D spending and 0.5% of patent applications. Trade statistics paint a picture of a relatively low-tech and low-value-added region: Africa produces 0.4% of global high-tech exports and 0.8% of intermediate technology exports, such as industrial machinery, automobiles and chemicals.

Unlike previous waves of industrial change, competition in the digital age does not require in-depth scientific expertise or massive capital investment. Instead, innovators and entrepreneurs in emerging markets are able to tap into digital talent and knowledge flows; and convert them into new goods, services and business models.

Specifically, Nigeria has made steady progress in digitization, technological advancement and innovation. The advent of the Internet has had a positive impact on Nigeria; connect businesses, individuals and businesses seamlessly. Internet access and mobile phone use have increased dramatically, as has science, technology, engineering, and math (STEM) education.

Nigeria has the potential to unleash innovation that could transform industries and improve well-being in the region. These innovations are visible in the transport, health, education, payments and fintech sectors.

Nigerian startups have attracted hundreds of millions of dollars in equity. Voltron Capital is one of the well-known active investors in Nigerian tech startups and Africa in general.

Since its creation in 2014, it has invested in 33 startups. The FinTech (FinTech) sector is one of the major and fastest growing start-up ecosystems in Nigeria and these companies in Nigeria are driving tangible change for business.

According to a study by the Boston Consulting Group (BCG), the number of African tech startups funded between 2015 and 2020 increased by 46%, almost six times faster than the global average.

However, Africa’s progress has been concentrated in a handful of countries: Nigeria and five other African countries (Egypt, Kenya, Morocco, South Africa and Tunisia). These six countries represent half of all African mobile communications subscriptions, for example. Internet access and mobile phone use have increased dramatically.

In 2021, Nigeria had 108.75 million internet users. This figure is expected to reach 143.26 million internet users by 2026. Four countries receive around 85% of the continent’s venture capital investments and 70% of STEM graduates.

South Africa, Egypt and Morocco account for 70% of public R&D spending in Africa. According to their analysis, only two countries, South Africa and Kenya, have comprehensive innovation regulations.

In a recent BCG report, Morocco’s automotive cluster of 200 companies is launching R&D initiatives linking manufacturers to universities and Kenya has become a hotbed for fintech. South Africa’s vibrant healthcare technology ecosystem includes more than 120 companies. Incubators, entrepreneurship training and investment funds make Egypt the fastest growing startup ecosystem in the region.

The good news is that talent in the region who are trained in the skills needed in areas like AI and advanced analytics are proving they can fit seamlessly into global value chains.

Freelance workers in these digital disciplines are in high demand, and the COVID-19 outbreak has made large companies much more receptive to remote work. This means that, for once, governments that invest in training can create jobs at home that will contribute to socio-economic development and innovation in Africa, rather than a brain drain.

Given the diversity of markets in the region, there is no one-size-fits-all approach to building and sustaining an innovation-driven economy that will work across Africa. The most appropriate strategies and policy combinations will depend on the types of innovators, such as multinational companies, local champions or startups, that are targeted.

There are, however, three fundamental steps that African governments must take to activate their national innovation system: develop a national innovation strategy, stimulate national innovation activity and activate the new national innovation ecosystem.

Build a national innovation strategy

Governments should focus on innovation-driven areas that can create value in the future by setting national ambition and targeting priority innovation sectors. This can be done taking into account the changing opportunities in the emerging global economy, digitally connected and focused on Industry 4.0. Based on this analysis, policymakers should identify the industrial sectors best positioned to meet key national goals.

Nigeria has taken the initiative to adopt a national strategy for the development and expansion of the technology ecosystem in communities, schools and innovation-driven enterprises (FDI), thus providing an opportunity for various sectors the economy to leverage technology to transform business models, improve productivity and efficiency; while creating jobs and wealth for operators.

Stimulate national innovation activity

To successfully launch different innovation clusters to stimulate innovation activity and attract foreign partners, African governments need to provide operational, technical and financial support; encourage collaboration, invite open innovation and provide a regulatory environment conducive to innovation.

Facilitate the new innovation ecosystem

A well-designed policy framework can lay the foundation for a thriving innovation economy. But governments, especially in developing economies like Africa, must also play a leading role in driving the investments needed to build innovation capacities.

Governments can leverage the success of leading edge companies to support the development of innovation ecosystems by working with the private sector to build supportive infrastructure, develop the talent pool, and actively seek and support investment for innovation. ‘innovation.

While there is no single innovation strategy that can work in a region as diverse as Africa, the basic approach is to define national strategies, stimulate innovation activity and activate the innovation system applies. Success in these areas will require collaboration between all players in the innovation ecosystem: local businesses, small entrepreneurs, academic institutions and investors. The specific policy formula should vary according to the level of economic maturity of each country, the existing capacity for innovation, competitive strengths, market ambitions and national needs.

As African countries continue to aggressively invest in their capacity to innovate and implement the right mix of strategies and policies, we believe the continent is poised to write a new chapter in its history. economic. But Africa must move now as there are still plenty of opportunities to step up to the top deck with innovation cycles that redefine the future.

Tolu Oyekan is associated with BCG

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