Nigeria has significant potential to benefit from the wider adoption of artificial intelligence (AI), according to the International Monetary Fund (IMF). The IMF's July 2024 study, Unlocking the Potential: AI in Sub-Saharan Africa, found that Nigeria, alongside Botswana, Mauritius, Namibia, Seychelles, and South Africa, has an employment structure that resembles those of emerging-market economies. This structure exposes the country to AI more than many other sub-Saharan African economies.
The IMF identified sectors with higher AI exposure, including information and communications technology, finance, and professional services, as important parts of Nigeria's modern economy. However, the Fund stressed that the present level of AI adoption across sub-Saharan Africa remains low compared with other regions. About four-fifths of jobs in sub-Saharan Africa currently have limited exposure to AI.
According to the IMF, roughly 22 per cent of jobs in sub-Saharan Africa are exposed to AI, with about 13 per cent of total employment facing significant replacement risks, while nearly 10 per cent could benefit from AI through productivity gains. The Fund noted that these figures should not be interpreted as a forecast of mass job losses, as AI would affect sectors and occupations differently depending on the tasks involved.
The IMF emphasized that Africa's bigger opportunity lies in using AI to raise productivity in agriculture, informal businesses, and other sectors where technology adoption remains limited. Expanding AI beyond today's digitally connected firms into agriculture and other sectors could substantially increase productivity across the region. Under a broader adoption scenario, AI could contribute about four per cent to sub-Saharan Africa's GDP over the coming decade.
The potential gains from AI adoption are particularly relevant to Africa because the region is expected to account for roughly half of new entrants into the global labour force by 2030. For Nigeria, the opportunity extends beyond technology companies to financial services, agriculture, education, healthcare, manufacturing, and government services, where AI-enabled systems could automate routine processes, improve decision-making, and expand access to services.
A Nigerian teacher using a chatbot to support students in mathematics is an example of how AI is already beginning to find practical applications on the continent. However, the IMF cautioned that AI adoption cannot be separated from the underlying digital infrastructure. Reliable electricity and affordable broadband are essential for widespread AI adoption.
The IMF's findings highlight the need for Nigeria to address its infrastructure and skills gaps to fully harness the potential of AI. With the right infrastructure and skills in place, Nigeria can leverage AI to drive economic growth and improve the lives of its citizens. The country's ability to adopt, adapt, and scale AI technology will be crucial in determining its future economic prospects.
Key points
- Nigeria's AI opportunity hinges on addressing infrastructure and skills gaps.
- AI adoption can drive economic growth and improve lives in Nigeria.
- The country must address weak infrastructure, limited digital access, and skills shortages to fully harness AI's potential.
