Jide Awe Founder, CEO Jidaw Systems Limited jidaw

1. Public Private Partnership (PPP) in ICT for Development in Nigeria– Private Sector development in the ICT4D plan Presented at eNigeria 2010 International Conference organized by the National Information Technology Development Agency (NITDA) 18 – 20 May, 2010 at the Shehu Musa Yar’ Adua Centre, Abuja, Nigeria Jide Awe Founder, CEO Jidaw Systems Limited http://www.jidaw.com

2. Presentation Overview • Baseline Scenario for PPP for ICT4D in Nigeria • National Development Strategy • Experiences from other Countries • Role of the Private Sector in the National ICT4D Plan • Risk Analysis • Conclusion

3. Baseline –PPP in ICT4D in Nigeria • Introduction • ICT in Nigeria overview • Private Sector in Nigeria overview • National Development Strategy baseline

4. Baseline –PPP in ICT4D in Nigeria • Information and communication are human needs in all spheres – social, educational and commercial – now with significant impact through Information and Communications Technology (ICT) • ICT is an essential requirement for survival and progress and global competitiveness- used to address poverty eradication, healthcare, wealth creation, job creation and education. • Without ICT people are unable to participate meaningfully in the knowledge economy and fulfill their potentials • Global village – Globalization – use of ICT weak or strong – close or widen the digital divide

5. Baseline –PPP in ICT4D in Nigeria • Does globalization lead to social and economic transformation, or address national issues? • Is it a job just for the public sector? ICT is a tool not the objective • Despite tech advances, without ICT and proactive policies ICT widens the gap between the digital haves and the digital have-nots” - the global digital divide between developed and developing countries • ICTs are essential but national, overall gains are not automatic. What are the roles of each sector? Which partnerships are needed? • Consistency, Coordination and Multistakeholder strategies – the “how” gone past the “why” • What is the role of private sector?

6. Baseline –PPP in ICT4D in Nigeria • The Nigerian Information Technology Development Agency (NITDA) in collaboration with the United Nations Economic Commission for Africa (UNECA) coordinated the development of the National ICT4D Strategic Action Plan strategies in key sectors within the context of the national development plans and the Seven-point agenda towards making Nigeria one of the leading economies in the world by the year 2020 • How can Public Private Partnership in ICT for Development in Nigeria achieve these goals In view of the role of the Private sector in the National ICT4D Plan?

7. Baseline – ICT in Nigeria • Information Technology – PC market in Nigeria – providing access – Nigerian brands – Zinox and Omatek but foreign dominate market; PC access and availability has improved but costs must go down for significant impact • "Computer for All Nigerians Initiative" CANi a Public-Private-Partnership, in 2006 to close this gap did not make desired impact • Telecom Infrastructure - growth from deregulation - introduction of major Global System of Mobile Communications (GSM), mobile phone providers starting with MTN Nigeria, Zain, Globacom and Mtel. Etisalat is the latest entrant.

8. Baseline – ICT in Nigeria • Telecom growth led to job creation, economic spinoffs. Telecom sector 2nd in FDI after oil • Increased availability of GSM, CDMA, VSAT (Very Small Aperture Satellite), telephony, Internet, data, fixed wireless services at national & regional levels. • Internet penetration is still too low at 17.1%; Broadband optic fibre cable projects are underway to improve availability, quality and pricing • ICT enabled Applications - for communication, online information gathering, research, e-learning, online transactions & e-banking; Local e-payment initiatives – cards, ATMs (Automatic Teller Machines), POS terminals, mobile phones, Internet

9. Baseline – ICT in Nigeria • Software - System software is 100% imported. Open Source Software (OSS) alternatives though deployed and growing locally do not command significant market share. • Local software industry faces the challenge of patronage and growth. All software used in the banking, oil and gas sectors are foreign. Institute of Software Practitioners of Nigeria (ISPON) launched a campaign to raise significant funds for establishment of a robust software industry • Local content development is a major concern for the ICT industry. Improved infrastructure is used to increase consumption of foreign ICT

10. Baseline – ICT in Nigeria • ICT in Unserved Areas – Universal Service Provision Fund (USPF) intervenes to close the digital gaps for rural, underserved and unserved • Computer Education - private and public sector institutions – academic and work based • ICT in schools – several initiatives exist • Regulatory/Professional Activities - Nigeria Computer Society (NCS), Nigerian Communications Commission (NCC) telecom regulator, National IT Development Agency (NITDA) is responsible for the implementation of the National ICT policy • Information security is a requirement for growth, confidence and protection of stakeholders in the digital economy but critical bills have not been passed

11. Baseline –Private Sector in Nigeria • Nigeria is the second largest economy in sub-Sahara after South Africa and one of largest producers of crude oil in the world. The economy is dominated by the Oil industry contributing over 90% of export earnings • SMEs provide a sufficient level of activity to be relevant, but support is inadequate. Microfinance policy being reviewed. informal sector (about 65% of the economically active) not served by the conventional financial institutions • CBN has approved the establishment of a N200 billion Small and Medium Enterprises Credit Guarantee Scheme (SMECGS), to promote access to credit by manufacturers and SMEs in Nigeria

12. Baseline –Private Sector in Nigeria • Agriculture employs two thirds of populace but the sector is not modernized and Nigeria imports significant amount of foodstuffs • Traditional Industry and Manufacturing – different types, Low capacity utilization, high cost production due to poor state of infrastructure • Oil & Gas – dominant in Nigeria's economy. Nigeria also marketing liquefied natural gas (LNG). Nigerian Content Development bill has been passed. The Petroleum Industry Bill (PIB) is still being debated. Temporary peace in Niger Delta with the Amnesty programme. Real inclusive development, rehabilitation still required

13. Baseline –Private Sector in Nigeria • Financial system. Critical to the economy.bank and non-bank financial institutions – Bank consolidation supervised by the Central Bank of Nigeria (CBN). Major banking overhaul in 2009. Slowdown of credit to the economy. • Stock market crashed in 2008-2009 resulting in significant losses by investors and loss of confidence • Challenges in Finance include: lack of innovation, poor public perception, average level of IT leverage, poor national finance culture, (savings, insurance), limited capacity (human and financial), limited credit card usage, inadequate research and development, corporate governance, low multistakeholder cooperation

14. Baseline –Private Sector in Nigeria • Development financial institutions set up for specific purposes such as housing finance, trade finance, urban development have yet to fulfill their mandates. • Privatization. Bureau of Public Enterprises (BPE) plans to privatize all the unbundled units of the generation and distribution arms of the Power Holding Company of Nigeria to conclude the power sector reforms. Additional due diligence on prospective investors who submitted bids for Nigerian Telecommunications Limited (NITEL) and M-Tel. • Foreign Direct Investment (FDI) - Nigeria provides incentivesfor investing in priority sectors of the economy which may bring valued technology and knowledge into the country.

15. Baseline –National Development Strategy • “Despite Nigeria’s oil wealth, poverty is still widespread” • The National development program is based on a "private-sector" led and "market- oriented" economy, diversify the economy away from its overdependence on the oil sector. • Based on National Economic, Empowerment and Development Strategy (NEEDS), SEEDS and Seven-point agenda towards making Nigeria one of the leading economies in the world by the year 2020. • NEEDS key actions: reforming the way government works and its institutions; growing the private sector; implementing a social charter for the people; and re-orientation of the people with an enduring African value system.

16. Baseline –National Development Strategy • The Economy - Nigeria has made progress toward establishing a market-based economy. Macro-economic stability was consolidated, growth in the non-oil sector, increase in Foreign Direct Investment, boosted by telecom investments • One of Nigeria's major achievements on the economic front was the drastic reduction in its external debt, which declined from 36% of GDP in 2004 to less than 4% of GDP in 2007. • Economic reform programme coupled with high crude oil prices from 2004 – 2008 boosted the country’s external reserves. However, the drop in world oil prices and the global financial crisis from 2007 – 2009 prompted the federal government to dip into foreign exchange reserves and have significantly reduced the reserves to meet pressing budget demands from state & local government agencies.

17. National Development Strategy • The Framework for National Development • Public Private Partnerships in ICT4D • Challenges to Development Strategy / National ICT4D Plan

18. The Framework for National Development • The National Economic Empowerment Development Programme (NEEDS) and NEEDS II outline the key development objectives of the government over whilst anchoring the pivot of the economy on the private sector, involving the use of public-private partnerships. In 2007, late President Yar'Adua introduced the Seven-point agenda towards making Nigeria one of the leading economies in the world by the year 2020. • Partnerships, structures and institutions are the necessary platforms for the achievement of these developmental goals. Nigeria needs to erect these structures and available strengthen them

19. Public Private Partnership in ICT4D • Bringing public and private sectors together in partnership for mutual benefit • About combining strengths. Lean on each other - What does the public have that the private needs? What does the private have that the public needs? • Varied interests, different roles, shared national objectives - developmental goals • Private sector capital for public sector projects? Multidimensional scope: talent, expertise, capital, ideas, technology, numbers, environment • Private/Public development and engagement • There has always been PPP in ICT but it needs to be deepened and development oriented

20. Challenges to Development Strategy / National ICT4D Plan • Major developmental challenge is the absence of infrastructure to meet developmental goals, • Mutually beneficial Multi-Stakeholder Partnership (MSP) - Public Private Partnership (PPP) - meeting of goals, injection of private strengths as well as the improvement of public sector performance and practices. PPP in ICT for Development in Nigeria should be aggressively prioritized and supported. • ICT enabled, globally competitive private sector needed for accessing new markets, generating new employment and economic opportunities, attract investment, promoting innovation, for sustainable economic growth and enabling the development of an information and knowledge based society.

21. Challenges to Development Strategy / National ICT4D Plan • Lack of Statistics on ICT sector and the effect of ICT • Private sector is mainly reactive in policy formulation • Most of the economy is in the informal sector. 65% of the economically active population is serviced outside the formal financial system. • Small business sector is largely underdeveloped and majority of SMEs are not globally competitive • Economic activity is plagued by poor quality and inadequate provision of basic infrastructure • Hostile operating environment - high cost of business setup, multiple taxation, bureaucratic public procedures, inefficient & corrupt business practices

22. Challenges to Development Strategy / National ICT4D Plan • Economy is heavily dependent on imports, industrial capacity utilization is less than 30%, local industry is uncompetitive due to high production costs • The dominant public sector promotes the culture of overdependence of the private sector on government patronage and contracts for quick, immense wealth • Despite the telecom boom 70 per cent of the rural dwellers have no access to telecom facilities • Though significantly improved, teledensity is still about 55%, Internet costs are expensive, broadband penetration is abysmally low and poor quality of service still plagues telecom service provision. • ICT penetration is low in the informal sector

23. Challenges to Development Strategy / National ICT4D Plan • Software opportunities are not being fully exploited to unleash the potentials of the Nigerian people • No strategic exploitation of open source software. • Local content development in ICT is very low • No knowledge culture for creativity, local content development, merit and entrepreneurship • Inadequate human capacity to meet the challenges of the Knowledge Economy. Brain drain is a reality. The present education system is not incorporating digital entrepreneurship and innovation. • Security concerns hamper efforts at attracting foreign investment - Nigerians in Diaspora • Lack of legislation and frameworks to support and protect e-business, ICT and ICT enabled activity and investment – not PPP in ICT4D friendly • [i]

24. Experiences from other countries • ICT strategies vary from country to country depending on what is perceived as priority, resources available and leadership commitment. • How are the following countries using PPP and ICT to drive development? • South Africa • Tunisia • India

25. Experiences from other countries South Africa • ICT for high unemployment and poverty levels as well as the lack of employment - ready graduates • Developing the Small Medium and Micro Enterprise (SMME) sector through the use of ICT/ICT SMMEs • Private sector led activities include provision of ICT infrastructure for FIFA 2010 Soccer World Cup • Developing Cybersecurity policy for securing the South African cyber space in a coordinated manner • Business Process Outsourcing and Offshoring (BPO&O) is a high-priority fast growing economic sectors providing business and work opportunities • Promotion of the BPO sector through funding assistance for investors, removal of obstacles, provision of incentives, global promotion, BPO Parks

26. Experiences from other countries Tunisia • Effectively mainstreamed ICT into national development plan to build a knowledge-based economy • Support for private sector development through ICT • Legal and regulatory frameworks helped to establish a climate of trust in the ICT environment allowed Tunisia to become a major outsourcing destination • Tunisia attracts significant investment in ICT and Public-Private Partnerships in Tunisia led to the development of ICT-enabled value-added services. • National cybersecurity strategy aimed at facilitating electronic commerce and online services • Emphasis on education and human capital development. Set up technology parks all over Tunisia -business incubators, R&D, tech education

27. Experiences from other countries India • India is recognized as a leader in the global software and BPO industries - most consistent growth driver • Provides incentives for promoting investment in IT with special schemes for Software Technology Parks (STP) and Special Economic Zones (SEZ). • Incentives for growth of the Electronics Hardware Sector from high growth rate of the Indian economy • Central to India’s strategy for ICT growth is Cyber security. Legal and regulatory framework is established to mitigate, check cyber crimes and support e-filing and e-commerce transactions. • Conducive, merit driven environment, continuous and strategic human capital development, leadership, policy interventions & enabling infrastructure

28. The Role of the Private Sector in National ICT4D Plan • Vision A prosperous Nigerian society where the political, economic and social system is built on knowledge, information and learning, with the private sector as the core driver of a multi-stakeholder partnership. • Key Objectives based on Policy Commitments (Seven-point agenda, NEEDS, NEEDS II, MDGs, NAPEM, World Summit on the Information Society (WSIS) Plan of Action/Tunis Declaration [2005-2015], African Information Society Initiative (AISI), NEPAD ICT framework & African Regional Action Plan on the Knowledge Economy (ARAPKE) etc)

29. Key Objectives – Policy Commitments • Diversification of the productive structure of the economy away from oil/natural resources. • Ensuring international competitiveness and integration of the productive/service sectors of the economy into the global economy. • Systematic reduction of the role of government in the direct production of goods and services. Policy of privatization, deregulation and liberalization will be pursued as the cardinal objective of the economic and developmental policy of government. • Strengthening the legal and regulatory frameworks for doing business and supporting information security • Pursue infrastructural development to facilitate and encourage foreign direct investments that are required to facilitate a competitive economy.

30. Key Objectives – Policy Commitments • Ensure sustainable environmental development. • Promote human and labour rights. • Coordinate sectoral development strategies with a view to ensuring development across board and ensure that the benefits are accruable to all. • Predictability of macroeconomic environment and efficiency of resource use predicated on Medium Term Expenditure Framework (MPEF) to ensure predictable and sustainable public finance situation at all levels of government. • Pursue policies consistent with raising domestic savings and increasing private investments. • Public debt sustainability. • Efficient tax administration • Develop an efficient capital market. • Eradicate extreme poverty and hunger

31. Key Goals / Deliverables • Substantial contribution of non oil sector to GDP • Developing a globally competitive ICT service sector and industry in Nigeria with the capacity to provide ICT products and services to meet the needs of local and global markets • Providing a conducive environment for private sector (local and foreign) investment in the ICT services and industry and becoming a leading and trusted regional hub • Developing a viable ICT-driven Industrial sector capable of generating economic growth and employment and producing goods for the domestic and export markets • Developing a globally competitive high value-added service sector for accelerated and sustainable socio-economic development

32. Development of Industry, Service and ICT sectors ICT and Industry

33. Development of Industry, Service and ICT sectors ICT and Services

34. Programmes for Facilitating the Role Of The Private Sector in National ICT4D Plan • PS-01 National ICT Statistical Information Service. • PS-02 National Development Monitoring System • PS-03 Electronic Banking (e-banking) and Financial Services Sector Initiative • PS- 04 National Transport Information Management System • PS-05 Electronic Business (e-business), Electronic Commerce (e-commerce) and Electronic Trade (e-trade) Initiative • PS-06 National Cultural Information System/Service (CultureLink) • PS-07 Programmes for the development and growth of a local ICT industry to facilitate the assembling, production, manufacturing, repair and maintenance of computers and related ICT products and services

35. Programmes for Facilitating the Role Of The Private Sector in National ICT4D Plan • PS-08 Software Development, Export and Software Technology Parks Initiative • PS-09 Programmes for the development and growth of the Traditional Manufacturing and Industrial sector through the utilization and development of ICT. • PS-10 Initiative for the advancement and empowerment of women through ICT • PS-11 Small Scale Enterprise Support through ICT • PS-12 ICT and Youth Entrepreneurship • PS 13 Business Process Outsourcing • PS 14 ICT Programme for Geopolitical Disadvantaged Areas. • PS-15 Military Involvement in Commerce through ICT • PS-16 ICT Sector Development FUND/BANK • PS-17 Rural Nigeria Digital Development

36. Programmes, Private Sector Area and Frequency/Value

37. Programmes, Private Sector Area and Frequency/Value

38. Programmes, Private Sector Area and Frequency/Value

39. Risk Analysis Major risks have to do with • Political Will • Enabling legislation • Enhanced Infrastructure • Rural Development • Micro and Small Business Funding • Stable climate devoid of policy inconsistency, uncertainty and confusion

40. Conclusion • For Nigeria to be one of the top 20 economies in Year 2020 ICT is a practical, strategic imperative for diversifying the economy away from overdependence on oil • Nigeria must leverage better on ICT to jump-start growth and development by combining the strengths of ICT, public & private sectors • ICT4D focus is freedom, independence - leapfrog into the knowledge economy and information society. Purpose driven PPP is essential to enhance global competitiveness, local content development and REAL, full participation in information age • Multiple obstacles in the path - PPP in ICT4D requires public and private sector development and engagement in a sustainable, widespread and inclusive manner

41. Policies are not enough • Policies are not enough. Coordination and collective implementation of the National ICT4D Strategic Plan through sub plans. Need for rigorous, monitoring, evaluation & review • Multidimensional ICT4D – PPP works in a creative and mutually beneficial manner. Common vision, same national interest. coherence & commitment • PPP and ICT for Development in Nigeria should be aggressively prioritized and supported by mainstreaming policies into national development programs • It is time to realize the immense potential of the imaginative, resilient and industrious Nigerian people. Quality, committed, ICT conscious leadership for a better life for all now and in future. ICT is more than ICT.

42. Thank you for your attention Jide Awe

43. References • "Shaping Information Societies for Human Needs" Civil Society Declaration to the World Summit on the Information Society WSIS Civil Society Plenary Geneva, 8 December 2003 • Globalization and the challenge of Development in Africa. Welcome address by Bankole Olubamise at a workshop on Trade and Sustainable Development, Calabar, June 5-6, 2004. • Richard Labelle UNDP Asia-Pacific Development Information Programme, "ICT Policy Formulation and e-Strategy Development" Guidebook • Information Technology in Selected Countries: Reports from Ethiopia, Nigeria and Tanzania. Edited by Eleen P. Drew and F Gordon Foster. UNU, 1994, 148p. Chapter 3 • ibid • Blessing Anaro Businessday Monday June 20, 2005 p.32 • http://thenationonlineng.net/web2/articles/37922/1/How-to-sustain-ICT-industry-growth-by-Ndukwe/Page1.html • ITU World Telecommunication/ICT Indicators Database • African Information Security Association (AISA) http://www.jidaw.com/security/aisa/aisa.html • Central Bank of Nigeria Press Release CBN ESTABLISHES SMALL AND MEDIUM ENTERPRISES (SME) CREDIT GUARANTEE SCHEME (SMECGS) 16th April, 2010 http://www.cenbank.org/Out/2010/publications/pressRelease/GOV/PRESS%20RELEASE%2016042010.pdf • “The Nigerian Banking Industry: what went wrong and the way forward” Convocation Lecture at Bayero University, Kano 26 February, 2010 Sanusi Lamido, CBN Governor

44. References • African Development Bank African Development Fund Federal Republic Of Nigeria Country Governance Profile February 2009 • Development Assistance Committee of the OECD,2003 in Country Assistance Plan for Nigeria. London: DfID December 2004, p 2. • Country Assistance Plan for Nigeria. London: DfID December 2004, p 2. • African Development Bank – Nigeria Country Profile • Nigerian Communications Commission Subscriber Data Feb 2010 http://www.ncc.gov.ng/subscriberdata.htm • Department of Communications, South Africa Strategic Plan 2009 – 2012 http://www.doc.gov.za/ • Department of Trade and Industry, South Africa BPO&O http://www.dti.gov.za/sectors/BPO_O.htm • The Global Information Technology Report 2009-2010 - World Economic Forum • Tunisia Ministry of Communication Technologies http://www.infocom.tn/index.php?id=64 • The International Forum on Information and Communication Technologies - ICT 4 all Forum – Tunis+4 - Hammamet, November 24, 2009 • Government of India, Department of Information Technology (DIT) http://www.mit.gov.in/ • Prof Dzidonu C.K Nigeria ICT4 Plan Development 2008 • National Strategic Plan on ICT4D. NITDA, 2008