Abdullah Al-Haqim 
The Nigerian government intends to launch an investment fund worth $ 40 million to support emerging technical companies in its early stages, as part of its efforts to enhance the entrepreneurial environment that has relied in recent years on private investments.
This fund aims to stimulate technological innovation and benefit from the capabilities of Nigerian youth in the technology sector.
Common financing between Nigeria and Japan
The Fund will be equally funded by the Japanese International Cooperation Agency, the Japanese government development arm and the Nigerian sovereign investment authority. According to the head of the National Agency for the Development of Nigerian Information Technology, Kashivo Ino Abdullah, a final agreement was reached on the launch of the fund, and the agreement is scheduled to be officially signed next month.
This fund comes within the framework of the Nigerian Emerging Companies Law for the year 2022, which provides a legal and regulatory environment that supports the growth of startups in the country.
The Nigerian Sovereign Investment Authority will supervise the management of this new fund to ensure that funds are directed towards supporting entrepreneurs and innovators in the technology sector.
It is noteworthy that the Nigerian Sovereign Investment Authority is responsible for managing the sovereign wealth fund for the country, which has more than $ 2 billion.
Nigeria: The pioneer of investment in African startups
Nigeria is one of the leading countries in the investments of startups in Africa, as its startups raised more than $ 2 billion between 2015 and 2022, the highest number compared to any other country on the continent, according to a report issued by the Disrupt Africa platform specialized in following up the entrepreneurial environment in Africa.
Nigeria has witnessed the emergence of several prominent technological companies that reached the classification of “unicorns”, which is exceeding one billion dollars. Among these companies, “Paystack”, which was acquired by “Stripe”, as well as other companies such as “Flutewarwave”, “Andla”, and “OPY”, which played a pivotal role in developing the financial technology and digital services sector in the African continent.
Motivating investment and granting exemptions
The law of startups, supported by this fund, seeks to enhance entrepreneurship by providing an organized framework that guarantees the sustainability and support of startups during its early stages. According to official data, more than 13,000 startups have so far been registered with the National Information Technology Development Agency, allowing them to be exempted from income tax for a period of three years.
Investors in these companies also get tax incentives, which enhances the attractiveness of the investment environment in the technology sector in Nigeria.
Challenges and opportunities
Despite the prosperity of the startups sector in Nigeria, the challenges are still ongoing, as entrepreneurs face problems in digital infrastructure, sustainable financing, and organizational procedures. However, this fund is expected to provide a more stable environment for the growth of startups, and is pushing tangible progress in the technological sector.
This fund is expected to attract more international investments, especially from Japan and other countries that see in Nigeria a promising market for digital innovation. Also, this cooperation between Nigeria and Japan may open the door to technological partnerships and expertise exchange programs that enhance the competitiveness of Nigerian startups at the global level.
A qualitative shift in the corporate environment
The launch of this investment fund is an important step in developing the environment of startups in Nigeria, as it reflects the government’s commitment to supporting innovation and technology as a basic engine for the economy.
While Nigeria aspires to become the leading technological center in Africa, the success of this fund remains dependent on its ability to provide effective financing, organizational facilities, and investment incentives that enable startups to achieve sustainable growth.
