Africa’s digital economy push threatened by weak public systems

Microsoft has warned that Africa’s ambition to build a strong digital economy may fail if government systems remain slow, fragmented and heavily dependent on manual processes.

Nonye Ujam, the director of government affairs for Microsoft West Africa, who made the call, in an interview with BusinessDay, said Africa’s digital economy represents a major opportunity to drive economic growth, create jobs and improve public service delivery, but stressed that success depends largely on how effective government institutions become.

According to her, the digital economy is no longer just another sector of the economy but the foundation for future prosperity, regional integration and economic resilience across Africa.

She explained that while private sector innovation continues to grow rapidly, many government processes across the continent are still trapped in outdated systems.

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“Core economic and administrative processes such as business registration, tax administration, land transactions and licensing are still largely manual or only partially digitised in many African countries,” she stated.

Ujam noted that simply adding technology to weak systems without deeper institutional reforms could worsen inefficiencies instead of solving them.

She warned that fragmented digital platforms, poor data coordination and lack of interoperability among government agencies continue to slow business activities, increase costs and weaken trust in public institutions.

According to her, digital government should be treated primarily as a governance challenge rather than just a technology project.

She said successful e-governance requires strong institutional leadership, cybersecurity frameworks, efficient digital architecture and long-term public sector ownership.

Speaking on Nigeria’s digital potential, Ujam said the country has positioned itself as one of Africa’s leading digital economies, supported by over 154 million internet users and a vibrant startup ecosystem.

She added that Artificial Intelligence is projected to contribute about $136 billion in productivity gains across four African markets by 2030, with Nigeria expected to account for nearly 43 percent of that value.

She also highlighted the strength of Nigeria’s startup ecosystem, which attracted about $410 million in funding in 2024 and surpassed $555 million in 2025, especially in fintech and digital services.

However, she stressed that sustaining such momentum would depend heavily on the quality of public digital infrastructure.

Ujam described the proposed National Digital Economy and E-Governance Bill, 2024 as a major step toward building a more coordinated digital system in Nigeria. According to her, the bill aims to create a unified framework for digital transformation, strengthen interoperability among government institutions and improve public sector data governance.

She said the reforms could reduce bureaucratic bottlenecks, improve transparency and create a more attractive environment for investment and innovation.

Drawing lessons from other countries, Ujam pointed to Estonia and India as examples of how effective digital public infrastructure can transform economies. She noted that Estonia has successfully digitised and automated major government services, helping the country save an estimated two per cent of its Gross Domestic Product annually through digital signatures and streamlined public services.

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India, she added, has also built one of the world’s most advanced digital public infrastructures, with its information technology sector contributing about 13 per cent to the country’s GDP. She said India’s investments in artificial intelligence infrastructure and affordable computing capacity have helped accelerate innovation and entrepreneurship.

Ujam maintained that Nigeria could achieve similar progress through stronger collaboration between government and private sector players. She said Microsoft has continued to support Nigeria’s digital transformation through partnerships focused on digital skills development, cloud infrastructure and cybersecurity.

According to her, initiatives such as Digital Skills Nigeria and the 3MTT programme have helped provide digital and AI training to more than six million Nigerians, with over 150,000 people already certified. She added that Microsoft’s cloud and AI technologies are helping governments and startups build more secure, scalable and citizen-focused digital systems.

Ujam concluded that Nigeria’s digital transformation would depend not only on technology investments but also on leadership, institutional reforms and governance capacity. She said embedding digital-first principles across public administration would reduce economic friction, expand inclusion and position Nigeria as a leader in Africa’s digital economy journey.