Over 68 million Nigerian youths to benefit from AfDB US$170 million funding

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AfDB loan to Nigerian Youths:

  • The African Development Bank has approved a loan of US$ 170 million, to assist millions of Nigerian youths to grow their digital and creative enterprises
  • Dubbed ‘Investment in Digital and Creative Enterprises Program (i-DICE)’, the initiative is a project of the Nigerian government, aimed at promoting investment in digital and creative industries
  • The initiative will stimulate investments in 226 technology and creative start-ups and provide non-financial services to 451 digital technology and small and medium enterprises

At least 68 million Nigerians aged between 15 and 35 will benefit from a US$ 170 million loan from the African Development Bank (AfDB) to finance their digital and creative enterprises.

In a statement seen by The Exchange Africa, the African Development Bank says the loan will benefit youths in innovative, early-stage, technology-enabled start-ups or those in the creative sector.

Select micro, small and medium-sized enterprises across Nigeria will also be recognized.

The investment in Digital and Creative Enterprises Program (i-DICE) is a Federal Government of Nigeria aimed at promoting investment in digital and creative industries.

The deal is also part of Nigeria’s efforts to build back better, greener, and more inclusively, to create more sustainable jobs for the teeming youthful population.
The program is co-financed by the Agence Française de Développement (AFD) and the Islamic Development Bank (IsDB).

Commenting on the financing, African Development Bank President Akinwumi A. Adesina said governments have a much greater role than just policymaking.

African Development Bank President Akinwumi A. Adesina/FILE

He added that governments need to be innovative and create an enabling environment that includes infrastructure and de-risking to harness private sector investments in key growth sectors.

Investing in the creative industry in Africa

The investment in the Digital and Creative Enterprises Program will also support the leaders through enterprise support organizations – groups that support, train, and sometimes fund entrepreneurs – including innovation hubs, accelerators, venture capital, and private equity firms.

Bank financing of i-DICE will help the Government initiative further consolidate Nigeria’s position as Africa’s leading start-up investment destination and as a youth entrepreneurship hub.

“This program is among the latest series of our operations meant to bolster the implementation of the Bank’s Jobs for Youth in Africa Strategy. Given that tech-enabled enterprise cut across all the economic growth sectors, the program’s focus on the digital sector will deepen Nigeria’s job creation efforts,” said Beth Dunford, Bank Vice President for Agriculture, Human, and Social Development.

The initiative will stimulate investments in 226 technology and creative start-ups and provide non-financial services to 451 digital technology and small and medium enterprises.

The program is expected to create 6.1 million direct and indirect jobs, of which the Bank’s financing will support the creation of about 850,000 jobs. The value added to the Nigerian economy connected to the program is estimated at $6.4 billion.

The program will boost Nigeria’s venture capital market through independently managed funds focusing on digital and creative enterprises. These funds aim to attract an initial capitalization of $433 million in private and public sector financing.

“This program will generate significant economic benefits to Nigeria,” said Lamin Barrow, Director General of the Bank’s Nigeria Country Department.

“The program interventions will help respond to the challenges of youth employment in Nigeria, which could intensify without scalable interventions. I want to recognize the strong country ownership, under the leadership of Vice President Osinbajo,” he added.

The African Development Bank’s active portfolio in Nigeria comprises 57 operations across 30 public and 27 private sector operations, valued at about $4.61 billion.

The i-DICE Program aligns well with the Bank’s strategic priority areas, better known as the High 5s – specifically, “Industrialize Africa,” “Improve the quality of life for the people of Africa,” and “Feed Africa.”

In a related story, AfDB’s board has approved a line of credit of €70 million and an equity investment of $24 million, to be granted to the West African Development Bank.

The line of credit will support businesses in the West African Economic and Monetary Union, particularly in job-creating sectors such as agribusiness, renewable energy, health and information, and telecommunication, which were drastically affected by the Covid-19 pandemic.

The million jobs in Africa’s creative industries

The €70 million forms part of a €150 million facility, which will be co-financed along with other development finance institutions.

The $24 million equity investment is part of a capital increase transaction, which will allow the African Development Bank to increase its shareholding from 0.55% to 1%, and therefore retain its seat on the Board of Directors of the West African Development Bank.

In addition, the African Development Bank will assist the West African Development Bank, through funding from the Women Entrepreneurs Finance Initiative to set up a technical assistance program to mainstream gender aspects in its project review process and to promote women’s entrepreneurship.

The project should help to create or consolidate at least 5,900 jobs (including 2,000 for women).

Wanjiku Njuguna is a Kenyan-based business reporter with experience of more than eight years.

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