Kenya vs Nigeria : digital hub competition
In recent years, Kenya has emerged as the new hub of innovation and technological development in Africa, even surpassing Nigeria to become the leader in the continent's technology market. This rapid rise is based on several key factors, including innovation in mobile payments, massive investments in startups, improved technological infrastructure, and government engagement.
Nicknamed « Silicon Savannah, » Kenya is home to one of the continent’s most dynamic tech scenes. Benefiting from some of the highest mobile internet speeds in the world and a tech ecosystem estimated at USD 1 billion, the country attracts renowned companies such as Facebook, Microsoft, and IBM. Swiss companies, particularly those working in information and communication technology (ICT), have also found fertile ground for their innovations, notably with revolutionary mobile payment solutions like M-Pesa.
Kenya: Favorable policies for startups and foreign investments
The creation of tech hubs like iHub in Nairobi has catalyzed the emergence of an ecosystem conducive to innovation and collaboration. These initiatives offer Swiss companies unique opportunities for dynamic partnerships with local professionals. Government engagement has also played a crucial role in the success of Kenya’s tech sector. Policies favorable to startups and foreign investments, as well as the promotion of science, technology, engineering, and mathematics (STEM), have bolstered the confidence of entrepreneurs and investors.
In 2023, this confidence was confirmed. According to Partech Africa’s 2023 Africa Tech Venture Capital report, Kenya leads with $719 million raised, ahead of South Africa, Egypt, and Nigeria, which remain the main investment destinations in Africa, capturing 79% of the funding. Nigeria, on the other hand, experienced a significant 59% drop in total equity investment, reaching $468 million in 2023, but remained at the forefront in the number of deals completed in this type of financing. A true startup incubator, Nigeria also showcases a thriving digital ecosystem.
Nigeria: A hub for digital content creation and information technology in Africa
Nigeria, with its population of over 200 million, offers a vast domestic market for tech companies. Lagos, nicknamed « Nollywood, » is a center for digital content creation and information technology in Africa. Nigerian startups have seen remarkable success in various sectors such as fintech, e-commerce, and online services. However, Nigeria faces challenges such as political instability, insecurity, and inadequate infrastructure, which can hinder the growth of its digital ecosystem. In contrast, Kenya enjoys relative political stability and advanced digital infrastructure, making it a more attractive environment for foreign investment and innovation.
Meanwhile, while Kenya excels in financial technologies and benefits from strong government support, Nigeria stands out for its vast and dynamic domestic market despite persistent challenges. Both are confirmed as incubators of technological innovations, attracting the majority of tech investments in Africa. In this regard, Kenyan President William Ruto recently made a two-day visit to Silicon Valley to promote his country’s strengths and establish partnerships with companies like Apple, Microsoft—which announced, with G42, a $1 billion investment in digital technology in Kenya—and Google. This proactive move places him ahead of his Nigerian counterpart.
