On Feb. 5, Nigeria unveiled Hyundai Kona electric vehicle assembled in Lagos, south west of the country. It came at a time when the oil-rich country is struggling to find its footing in the global push to eliminate combustible vehicles.
The federal government says there is an ongoing plan to make 30% of vehicles being used in Nigeria electric by 2025.
According to the director-general of the National Automotive Design and Development Council (NADDC), Jelani Aliyu, Nigeria will henceforth join the course to embrace cleaner energy vehicles and the Hyundai Kona is just the beginning.
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Aliyu said that Stallion Group, which spearheaded the innovation back in 2020, invested as much $300 million in Nigeria. He urged Nigerians to embrace technology as it is helping other countries to create wealth through innovations.
While the Kona EV was welcomed in Nigeria as it is the first of its kind, many questions have been cropping up regarding the sustainability of an EV industry amidst oil concentrated economy, poor infrastructure and business-hostile government policies.
The concern, which rightly emanated from perceived anti-innovation recent events and Nigerian government’s default attitude of ban toward innovative developments in the country that comes with a challenge, reveals how Nigerians and investors see government’s promises on tech and innovative unconventional businesses.
In 2019, Nigeria’s Eight Assembly had a rowdy session debating the Electric Car Bill introduced by Senator Ben-Murray Bruce. The aim of the Bill had been to phase out combustible vehicles in Nigeria by 2035, replacing them with electric vehicles in tandem with global clean energy goals.
The Bill didn’t make it to the second reading, it was considered irrelevant because Nigeria is an oil producing nation. Among the senators who opposed the Bill was the then deputy senate president Ike Ekweremadu, who argued that increase of electric vehicles will be detrimental to our oil-based economy.
“Besides, in economic sense, we are an oil producing country. So, we should do everything possible to frustrate the sale of electric cars in Nigeria to enable us sell our oil,” he said.
In 2018, Lagos State started to witness an inflow of motorbike ride-hailing startups. Lagos has a crazy traffic situation, and the startup idea was developed to help commuters beat it using more flexible means of transport – motorcycles.
By 2019, Lagos-based motorbike ridesharing services were witnessing a boom with a series of mouth-watering fundraising rounds. Gokada, one of the leading companies in the space, raised $5.3 million in May, marking a breakthrough in the bike-hailing ecosystem and setting a trajectory that others would soon step into across Africa.
A month later, Gokada’s competitor, MAX.ng raised $7 million, OPay’s ORide, another leading player in the field raised $120 million, all to expand the motorbike ridesharing innovation across Africa. TechSci study projected a collective $9 billion revenue pool in the industry by 2021 then.
But in January 2020, the companies met their untimely death following the decision of Lagos State government to ban the operation of motorbike services. It was a shocking development that did not only kill the innovative dreams, but also set a dangerous precedent that investors have become wary of because there is no end in sight as it keeps touching every tech-based field.
Therefore, when the Central Bank of Nigeria (CBN), on Friday released a circular directing all regulated financial institutions in Nigeria to close all crypto operating accounts with immediate effect, it did not surprise many.
“When I saw this news, I was a bit concerned but I am not surprised … the CBN directive is legal but is it the wisest decision? I am not sure about this,” Kingsley Moghalu, former CBN Deputy Governor said on Channels TV Sunday politics.
Although there have always been reasons by the governments justifying the decisions to ban, it tells terribly on Nigeria’s readiness to move along with global tech and innovative trends. Lagos State said commercial motorbike services fuel insecurity in the State, and CBN’s decision to ban the operation of crypto exchanges hinges on the claim that they enable money laundering, fraud and terrorism. But these are seen as peculiar issues.
In the last 10 years, the FBI has made series arrests connected to cryptocurrency fraud. Last week, there was a report of Antonije Stojilkovic, a Serbian man extradited to the US for defrauding investors around the globe to the tone of $70 million. According to DOJ’s charges, the suspect and his co-conspirators created a scheme where they solicited investment in binary options and cryptocurrency mining, using it to defraud people.
There have been more reported high profile cases of cryptocurrency fraud in the US than in Nigeria, yet the United States regulators have not moved, on the excuse of fraud, to ban cryptocurrency exchangers. Rather, the FBI keeps educating crypto users and investors on how to conduct safe cryptocurrency transactions and where to report if they notice anything fraudulent, while the regulators work to develop a sustainable framework that will guide the emerging market.
With these chronicles of ban, Nigeria is building a reputation of a country whose solution to every challenge posed by tech and economic development is to ban the entire idea.
Thus, the dream of having 30% electric vehicles in Nigeria by 2025 is attainable, what potential investors who would make it possible is wary of is; apart from infrastructural deficiencies like poor electricity supply that will stymie the development of charging stations, the threat of ban when the government thinks the evolution is posing a threat to its oil-based economy.