The report, titled World Development Report 2026: The Promise of Artificial Intelligence, identifies Nigeria and Kenya as two African economies that have experienced rapid growth in AI adoption among businesses as generative AI tools become more affordable and easier to deploy.

Drawing on findings from the World Bank Enterprise Survey on AI Adoption, the report assessed AI usage among formal businesses with at least five employees across India, Jordan, Kenya, Mexico, Nigeria, Thailand and the United States.

According to the report, AI adoption among Nigerian formal firms increased from less than 5% in 2022 to approximately 40% in 2025, bringing the country’s adoption rate in line with that of the United States. Kenya recorded a similar increase over the same period.

“Data from the World Bank Enterprise Survey on AI Adoption show that between 2023 and 2025, several developing economies experienced a rapid surge in AI adoption among formal firms with at least five employees,” the report stated.

“In Kenya and Nigeria, for example, less than 5 percent of such firms used AI in 2022, but by 2025, this figure had risen to about 40 percent, matching adoption rates in the United States.”

The World Bank said the findings demonstrate that AI adoption is no longer confined to highly digitised businesses.

One of the report’s notable findings is that 21% of Nigerian firms that still rely primarily on handwritten records for business operations have already adopted AI in some form, with many using chatbot applications accessible through mobile phones.

According to the report, the trend suggests that businesses do not require sophisticated digital infrastructure before beginning to benefit from artificial intelligence.

However, the World Bank cautioned that matching the United States in adoption rates does not necessarily mean Nigerian firms are deploying AI with the same depth or sophistication.

The report noted that while businesses in developing economies are rapidly embracing AI, significant differences remain in the complexity of applications, supporting infrastructure and the extent to which the technology is integrated into business operations.

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The Federal Government has begun deploying the World Bank’s new blockchain-powered FundsChain platform to improve transparency and curb financial leakages in donor-funded projects.

The implementation was confirmed in a statement issued by Bawa Mokwa, Director of Press at the Office of the Accountant-General of the Federation (OAGF), after a workshop held Tuesday in Abuja.

Speaking at the event, the Accountant-General of the Federation (AGF), Dr. Shamseldeen Babatunde Ogunjimi, described the rollout as a major step in reforming how development funds are managed. He said the blockchain-driven system will boost traceability, accountability, and efficiency across World Bank–supported projects.

Six World Bank projects will be onboarded in the first phase.

Ogunjimi also announced the introduction of a new Financial Management Manual (FMM), which will serve as the official guide for processing transactions under World Bank–funded programmes, warning project coordinators to adhere strictly to the rules to minimise infractions and enhance Nigeria’s performance ratings.

A new policy jointly agreed with the World Bank will also bar project financial management staff from being removed within six months of project closure. Outgoing officers must now work with incoming ones for at least three months to ensure smooth handover and avoid undocumented expenditures.

Ogunjimi noted improvements from earlier reforms, including a 61% reduction in lapsed loans — from $18 million to $7 million — and a 15% drop in undocumented advances.

Representing the World Bank Country Director, Senior Financial Management Specialist Akram ElShorbagy commended the OAGF for ongoing reforms and urged sustained institutional collaboration to ensure project success.

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The announcement was made by Anshula Kant, Managing Director and Chief Financial Officer of the World Bank Group, during a courtesy visit to President Bola Tinubu in Abuja on Wednesday.

Kant described the broadband project as one of the largest digital infrastructure undertakings globally and a major component of the World Bank’s deepening collaboration with Nigeria.

“One of the biggest forthcoming projects will be in the digital space—providing digital broadband access across the country,” she said, adding that the initiative aligns with broader efforts to accelerate inclusive economic growth and job creation.

Kant highlighted Nigeria’s reform momentum under the Tinubu administration, commending recent macroeconomic policies that she said position the country favorably for long-term support and investment.

“Nigeria is on the right path. The World Bank is committed to helping the country unlock faster economic development and create the jobs and opportunities its population needs,” she said.

Nigeria’s Finance Minister, Wale Edun, emphasized the transformative nature of the fiber optic project. He noted that the initiative is being led by the Ministry of Communications, Innovation and Digital Economy, under Minister Bosun Tijani, and represents one of the largest efforts of its kind globally.

“This is a landmark project that will significantly enhance Nigeria’s digital infrastructure and connectivity,” Edun said.

Kant also stressed the importance of human capital development and youth employment, pointing to energy access, digital services, and quality healthcare as foundational pillars for Nigeria’s progress.

The meeting underscored the strategic alignment between the World Bank’s development priorities and Nigeria’s national agenda, with upcoming infrastructure investments expected to improve digital access, drive productivity, and uplift living standards across the country.

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The collaboration between the National Information Technology Development Agency (NITDA), the World Bank, and the World Trade Organisation marks a significant step towards realizing the potential of a digital transformation that promises to spur economic growth and development.

The digital economy has revolutionized the way countries develop and engage with the global market thereby enhancing cross-border data services which has the potential to unlock new opportunities for various segments of Nigerians and foster a more inclusive economic environment.

Their combined efforts aim to reform the economy for sustained inclusive growth and accelerate diversification through industrialization and digitization. These initiatives are crucial in harnessing the power of digital trade, which can connect Nigeria’s businesses to global markets and equally drive innovation.

Digital trade involves the exchange of goods and services through digital platforms, underpinned by the flow of data across borders. Cross-border data services facilitate this by ensuring data can move freely and securely between countries.

These services are crucial for e-commerce, cloud computing, financial transactions, and other digital activities that form the backbone of the modern economy.

By improving cross-border data services, Nigeria can enhance its participation in global trade, boost productivity, and stimulate economic growth. The importance of digital trade cannot be overstated. It not only opens up new markets for Nigerian businesses but also paves ways to overcome the economic challenges and more inclusive and resilient economy.

Access to global markets is one of the critical advantages of the collaboration. With improved cross-border data services, Nigerian businesses can integrate into international value chains, enhancing their competitiveness. This access allows local companies to collaborate with foreign partners, adopt best practices, and innovate continuously. As a result, Nigerian products and services can gain a foothold in global markets, driving exports and contributing to economic growth.

Additionally, Utilizing cross-border data services can significantly reduce costs for businesses by offering more affordable data storage and management solutions.

Traditional on-premises data storage requires substantial investments in hardware, maintenance, and security. In contrast, cloud-based services provided by global data centers offer scalable and cost-effective alternatives. Companies can pay for only the storage and computing power they need, avoiding the upfront costs associated with purchasing and maintaining physical infrastructure.

Also, the presence of reliable cross-border data services assures foreign investors of seamless operations and secure data handling. Investors are more likely to commit to markets where their data can flow freely and safely across borders, without facing regulatory bottlenecks or security risks. For example, a global tech company may choose to set up a regional hub in Nigeria if they are confident in the country’s ability to support its data needs effectively. This can lead to job creation, technology transfer, and increased economic activity.

Enhancing cross-border data services can significantly contribute to the economic resilience of Nigeria. By diversifying the economy through digital trade, Nigeria can reduce its reliance on traditional sectors such as oil and agriculture. This diversification makes the economy more adaptable to global economic fluctuations and less vulnerable to external shocks.

Despite the significant benefits, there are several challenges that Nigeria must address to fully realize the potential of cross-border data services. One of the primary challenges is the need for a robust digital infrastructure. Reliable internet connectivity, data centers, and cybersecurity measures are essential to support the seamless flow of data across borders. Investing in digital infrastructure is crucial to ensure that businesses and individuals can take advantage of digital trade opportunities.

Data security and privacy are also significant concerns. In an interconnected digital economy, protecting sensitive data is paramount. Cybersecurity threats and data breaches can undermine trust in digital services and have severe economic and social consequences. Developing and implementing robust data protection laws and cybersecurity measures is essential to safeguard data and build trust in the digital economy.

Regulatory hurdles can also pose challenges. Navigating the complexities of international data regulations requires a coordinated approach. Different countries have varying data protection laws and standards, which can create barriers to cross-border data flows. Harmonizing regulations and ensuring compliance with international standards is necessary to facilitate smooth and secure data exchanges. Policymakers need to work together to create a regulatory environment that supports digital trade while protecting data privacy.

Addressing these challenges is essential to create a conducive environment for cross-border data services and ensure that the benefits of digital trade are realized.

To overcome the challenges and harness the potential of cross-border data services, Nigeria needs to make strategic policy interventions. Investing in digital infrastructure is a top priority. This includes expanding broadband connectivity, building data centers, and enhancing cybersecurity measures. Government and private sector investments in infrastructure will provide the foundation for a robust digital economy.

Developing strong regulatory frameworks is also crucial. Policies must balance innovation with data protection, ensuring that data flows are secure and privacy is respected. This involves updating existing laws and creating new regulations that reflect the realities of the digital age. Collaboration with international partners that have been into this for ages can help Nigeria adopt best practices and standards for data protection and cybersecurity.

Inclusive policies are essential to ensure that all segments of the population benefit from digital trade. This includes promoting digital literacy and skills development, especially in underserved areas. Targeted initiatives to improve internet access and affordability can help bridge the digital divide. Policies should also support marginalized groups, such as women and youth, by providing them with the tools and opportunities to participate in the digital economy.

Overall, enhancing cross-border data services presents a significant opportunity for Nigeria to drive inclusive economic growth. By creating economic opportunities, improving access to global markets, and fostering innovation, these services can contribute to a more prosperous and equitable society.

Businesses, both local and international, play a critical role in this transformation. They must embrace digital tools and technologies, invest in digital skills development for their workforce, and engage in partnerships that enhance their capabilities and reach, as the time to act is now.

Shuaib S. Agaka, a tech journalist writes from Kano

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The Federal Government and the World Bank are collaborating to raise the sum of $3 billion to fund additional 120,000km fibre optic cables to boost broadband infrastructure and connectivity in Nigeria.

The Minister of Communications, Innovations and Digital Economy, Dr. Bosun Tijani, disclosed this in Abuja on Tuesday at a stakeholders’ engagement with the theme “Realising a Nigerian Vision of Broadband for All.”

Tijani, who expressed hope that the funds would be raised in the next two or three years, said the project involved stakeholders from the private sector and it would be delivered in the next three years.

According to him, it has become imperative to seek investments in the nation’s digital backbone to facilitate access at affordable prices to the digital space for all Nigerians.

Speaking during the stakeholders meeting, the Minister said: “We are here with critical stakeholders on how to attract investments and fund our broadband infrastructure. I am sure everybody that is listening to me probably understands that now we cannot do without technology on the internet; so, we all need quality access regardless of our location.

“There is a need for us to invest in that databank. So, it is the kind of thing that we call the telecommunications infrastructure, or in some cases, we call the fibre optic cables. So, there is actually a cable that helps us make it possible for the internet to happen.”

According to him, Nigeria has laid 3,035km fiber optic cables, but 120,000km fiber optic cables would be required for Nigerians to have quality and efficient access to the Internet and other digital services irrespective of their locations.

In his remarks, Mr Franz Drees-Gross, the World Bank Regional Director, (Infrastructure) West and Central Africa, said the first phase of the project would involve laying 95,000km fiber optic cables across Nigeria. Drees-Gross said it would improve access and digital services content in the country.

He described Nigeria’s digital ecosystem as vibrant, adding that the World Bank was deeply involved and interested in supporting Nigeria to raise the needed funds for the project.

“We plan to set up a digital National Broadband fund and to roll out about 95,000 kilometers of what we call middle mile cable. That is the terrestrial cable in the territory of Nigeria to bring broadband to more parts of the country.

“I think Nigeria has about 35,000 kilometers of broadband cable. The idea is to add another 95,000 and what we are discussing with the government is what is the best way to finance that,” he said.

According to him, Nigeria has a very impressive and vibrant digital ecosystem in Lagos. He added that the country can be the hub for exporting digital services to West Africa.

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Nigeria, often hailed as Africa’s most populous nation and its largest economy, is facing a significant obstacle on its path to economic development – multiple taxation. Despite its potential for robust economic growth, the burden of excessive and duplicative taxes, termed ‘nuisance taxes’ by the World Bank, continues to hamper the country’s progress.

To address this issue, a workshop titled “Revisiting Taxation for Economic Growth” was recently held to shed light on the challenges posed by multiple taxation and to chart a path towards more equitable tax policies.

The workshop, attended by government officials, tax experts, and business leaders, aimed to address a critical question: How can a fiscal tool like taxation, designed to promote economic development, become a hindrance to it?

The event sought to debunk misconceptions about taxation, emphasizing its role as a backbone for public finance, providing funding for social programs and public investments.Taxation, when wielded effectively by the government, becomes an instrument for equitable and sustainable growth.

However, the issue at hand was the proliferation of multiple taxation, which has been counterproductive to economic development. Multiple taxation occurs when the same or similar taxes are imposed on the same income, transaction, or entity by different levels of government.

The National Tax Policy of 2017 recognized the need to eliminate multiple taxation at all levels of government.

In line with this, President Bola Ahmed Tinubu recently signed several Executive Orders to curb arbitrary taxes, demonstrating the government’s commitment to addressing this issue.

The formation of the Committee on Fiscal Policy and Tax Reforms was another step towards harmonizing taxes and creating a conducive environment for both local and foreign investments.

The adverse effects of multiple taxation are multifaceted. Not only does it fail to increase government revenue, but it also cripples otherwise profitable businesses, reduces the ease of doing business, incentivizes tax evasion, and complicates tax compliance.

The World Bank has noted that excessive taxation leads to diminishing tax revenues, as businesses struggle or evade taxes.

Apart from these challenges, the administrative burden of complying with multiple taxes further erodes Nigeria’s attractiveness for business and competitive practices.

This situation weakens the country’s economic foundations, devalues its currency (the Naira), and contracts its gross domestic product (GDP).

The workshop provided a platform to reevaluate the principles of taxation, including neutrality, efficiency, certainty, simplicity, effectiveness, fairness, and flexibility. The federal government’s policy direction is for all tiers of government to align closely with these principles.

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TECHDIGEST – Increased consumption of data services and the continued rise in subscriber numbers are driving Nigeria’s information and communications technology sector growth, the World Bank has disclosed.

The global bank stated that those two factors were responsible for the 10.3 per cent year-on-year expansion that the sector witnessed in the first quarter of 2023.

It revealed this in its latest report titled ‘Nigeria Development Update (June 2023): Seizing The Opportunity’.

It said, “Strong growth in telecommunications and financial services supported a 4.3 per cent y-o-y increase in services output in Q1 2023.

“The information and communications technology sector, which did not contract even during the 2020 recession, expanded by 10.3 per cent y-o-y due to increased consumption of data services by households and businesses and higher subscriber numbers.”

In 2022, the ICT sector contributed N12.32tn to real GDP as against the N11.23tn recorded in 2021, according to the National Bureau of Statistics.

It contributed N21.15tn to nominal GDP in 2022, an increase from the N17.78tn it did in 2021.

READ ALSO: How Nigerians lost N25.5bn to e-fraud in four years

The ICT sector was one of the pillars of the country’s economy, driving the service sector, which contributed 56.27 per cent to aggregate GDP in the fourth quarter of 2022.

In the first quarter of 2023, the service sector drove the performance of the country’s GDP, recording a growth of 4.35 per cent and contributing 57.29 per cent to aggregate GDP.

Commenting on the ICT sector’s performance in Q1, 2023, the NBS said, “In nominal terms, in the first quarter of 2023, the sector growth was recorded at 41.84 per cent (year-on-year), 21.30 per cent points increase from the rate of 20.54 per cent recorded in the same quarter of 2022, and 20.43 per cent points higher than the rate recorded in the preceding quarter.

“The sector in the first quarter of 2023 recorded a growth rate of 10.32 per cent in real terms, year-on-year. From the rate recorded in the corresponding period of 2022, there was a decrease of 1.75 per cent points.”

The total number of mobile telecom subscriptions rose by 13.89 per cent to 222.23 million in 2022 from the 195.13 million in 2021, according to the Nigerian Communications Commission. At the end of the first quarter of 2023, it had risen to 225.82 million mobile subscriptions.

Mobile Internet subscriptions grew by 8.94 per cent in 2022 to 154.28 million from 141.62 million, indicating an increase in Internet usage in the country.

While details about data usage for 2022 has not been released, data consumption has been on a steady rise in the country.

In 2021, it grew to 350,165.39TB from 205,880.4TB.

According to the latest Ericsson Mobility Report (June 2023), data consumption has been surging due to rising smartphone subscriptions and increasing average data volume per subscription, fueled primarily by increased viewing of video content.

It predicted that data usage in Nigeria would spike in the coming years.

It said, “Sub-Saharan Africa is forecast to be the region with the highest growth in total mobile data traffic, rising by 37 per cent annually between 2022 and 2028 as service providers across the continent continues to invest in 4G networks and migrate customers from 2G and 3G.

“This increase in data traffic will primarily be driven by a four times increase in smartphone traffic in the period, with average data per active smartphone settling at 19 GB per month in 2028.”

According to the former Minister of Communications and Digital Economy, Professor Isa Pantami, the ICT sector contributes thrice as much as the oil and gas sector to the country’s GDP.

He said, “For over 50 years, Nigeria relied so much on oil and gas. But today, we have reached a situation where the contribution of ICT to our gross domestic products in Nigeria is almost three times the contribution of oil and gas to the country’s GDP.

“In the last three years, we have set up three unprecedented records with regard to ICT contributions to the GDP.”

Punch

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