An independent review of Nigeria’s Science, Technology, Engineering, and Innovation (STEI) landscape, analyzing cross-sectoral progress, persistent gaps, and the integrated path forward for a diversified, trillion-dollar economy.
Executive Summary: A Year of Strategic Diversification and Sectoral Disparities
The year 2025 has been a defining period for Nigeria’s innovation ecosystem, characterized by strategic policy initiatives and a noticeable maturation beyond the digital sphere into foundational sectors. Driven by a governmental focus on economic diversification, the year witnessed landmark legislation in digital governance, significant reforms in solid minerals and power, and continued investor interest in homegrown solutions. However, this progress unfolds against a backdrop of deep-seated structural challenges—from stark funding disparities and unreliable infrastructure to regulatory uncertainty. As Nigeria positions itself for competitive regional and global roles, the convergence of coherent public policy, private sector investment beyond fintech, and international partnership will determine the trajectory of its innovation journey into 2026 and beyond.
Government Performance & Policy Framework
The administration has positioned technological innovation and economic diversification as central to its agenda, aiming to build a foundation for a trillion-dollar economy.
Key Policy Initiatives
· National Digital Economy and e-Governance Bill (2025): A landmark legislative effort to create a comprehensive framework for digital transformation, mandating digital government processes and establishing governance for AI and emerging technologies.
· 3 Million Technical Talents (3MTT) Programme: A flagship human capital initiative. By December 2025, the program reported training 135,000 Nigerians, with 15,000 securing tech jobs.
· Power Sector Liquidity Solution: Finalization of a N1.23 trillion Power Sector Bond to address the crippling legacy debts in electricity, aiming to restore investor confidence.
· Solid Minerals Sector Reforms: Digitalization of the Mining Cadastre Office, establishment of Mining Marshals, and a new development roadmap focused on value addition.
Sectoral Performance & Key Deliverables: A Whole-Economy View
1. Digital & Technology Backbone
· Information & Communication Technology (ICT): The digital engine, contributing 11.18% to real GDP in Q2 2025 and growing at 6.61% year-on-year. Over 163 million Nigerians have internet access, fueling a telecom sector projected to reach $11.43 billion by 2029.
· Fintech: Remains the investment champion, raising **$112.9 million in H1 2025** (64% of all startup funding). Success stories like LemFi ($53M round) underscore confidence in financial innovation.
· Emerging Technologies (AI, Clean Tech): Gaining momentum. The AI market is forecast to reach $4.64 billion by 2030. Clean energy startups like Salpha Energy secured funding, addressing critical off-grid power needs.
2. Foundational Sectors Undergoing Transformation
· Energy & Power: A sector in critical transition. The N1.23 trillion bond aims to settle legacy debts that have paralyzed generation. Oil’s contribution to GDP remained modest at 3.44%, highlighting the urgent need for a functional electricity market to unlock economic productivity across all sectors.
· Solid Minerals: A rising star in diversification, with contribution to GDP rising to approximately 4.6% in 2025, up from less than 0.5% a decade ago. Reforms aim to attract investment and combat illegal mining.
· Agriculture & Water Resources: The largest employer, with crop production adding ₦9.11 trillion (17.8%) to GDP in Q2 2025. The integrated Agritech market is projected at $600 million by 2025, focusing on supply-chain tech and precision farming.
· Marine & Blue Economy: Holds vast, untapped potential, currently contributing less than 3% to GDP. The Ministry unveiled ambitious plans to generate $20 billion and create two million jobs, with a major investment summit planned for 2026.
· Aviation: A vital enabler, contributing $2.5 billion to GDP (0.7%) and supporting 217,000 jobs. Challenges remain, with high costs meaning the average Nigerian must work 37.6 days to afford a plane ticket.
3. Health Sector in 2025: High Need, High Potential, Low Funding
The health sector presents a stark paradox: immense demographic need and market potential juxtaposed with severe underinvestment, especially in innovative healthtech.
· Achievements & Contribution:
· The sector’s core market value is projected to reach $1 billion by 2025.
· Incremental policy efforts focused on strengthening primary healthcare and pursuing local vaccine production capacity.
· Isolated healthtech innovations emerged in telemedicine, maternal health tracking, and hospital management systems, demonstrating local problem-solving capability.
· Critical Challenges:
· Acute Funding Drought: Healthtech raised a mere $1.9 million in H1 2025, a minuscule fraction compared to fintech. This starves the sector of the capital needed for R&D and scaling.
· Fragmented and Weak Infrastructure: Public health infrastructure remains overburdened, while digital health solutions grapple with the same power and internet constraints affecting the broader economy.
· Complex Regulatory Pathway: Navigating approval processes for medical devices, digital therapeutics, and data privacy in healthcare creates high barriers for startups.
· Talent Drain: Medical professionals and biomedical engineers continue to emigrate at high rates, depriving the local ecosystem of critical expertise.
· The Way Forward for Health & Healthtech in 2026:
· Government: Create a dedicated healthtech regulatory sandbox within NAFDAC to fast-track innovations. Implement preferential procurement policies for locally developed health solutions. Anchor funding for public-private partnerships in primary healthcare digitization.
· Investors: Consciously diversify portfolios to include healthtech, recognizing its long-term social impact and economic potential. Explore blended finance models that combine philanthropic and commercial capital for early-stage health ventures.
· Ecosystem: Founders should build sustainable B2B or subscription models targeting clear pain points (e.g., chronic disease management, diagnostic access). Strengthen ties with teaching hospitals for piloting and validation.
4. Cross-Cutting Sectors: Environment & Climate Change
Nigeria submitted an enhanced NDC 3.0, committing to a 32% emissions reduction by 2035. However, climate finance flows remain below 1% of GDP, with adaptation projects receiving less than one-third of the total and covering only 6% of estimated needs. This financing gap represents both a critical vulnerability and a massive opportunity for green innovation and investment.
Critical Challenges Constraining Growth
1. Glaring Innovation Deficit: Nigeria’s ranking of 113th out of 133 in the Global Innovation Index underscores systemic R&D underinvestment.
2. Infrastructure Fragility: Unreliable electricity remains the single largest operational tax on businesses.
3. Regulatory Uncertainty & “Policy Whiplash”: Inconsistent implementation across states and sectors stifles long-term planning.
4. Acute Funding Imbalance: The overwhelming concentration of capital in fintech (64% of funding) starves other vital sectors like Healthtech, cleantech, and Agrictech.
5. Talent Drain: A global war for talent sees top professionals emigrating for better opportunities.
The Way Forward: Priorities for an Integrated 2026
To build on 2025’s momentum, a concerted multi-stakeholder approach is required, recognizing the interconnectivity of all sectors.
For the Government:
· Accelerate and Clarify Cross-Sectoral Regulation: Expedite the Digital Economy Bill and create stable “regulatory sandboxes” for Healthtech, Fintech, and Cleantech.
· Catalyze R&D and Deploy Anchor Investments: Move beyond skills training to fund applied R&D. Use strategic public investment (e.g., in power, ports, mineral processing) to crowd in private capital and create markets for innovators.
· Foster Sectoral Interlinkages: Explicitly connect digital infrastructure goals with agricultural productivity, mining sector transparency, and healthcare delivery.
For the Private Sector & Investors:
· Embrace “Foundational” Infrastructure: Invest in solutions for power, logistics, and port efficiency—the unglamorous pillars that lift all sectors.
· Diversify Investment Portfolios Consciously: Actively seek opportunities in healthtech, edtech, cleantech, and agrictech to build a resilient and balanced ecosystem.
· Build for Regional Scale and Integration: Design solutions with the African Continental Free Trade Area (AfCFTA) in mind, enabling cross-border scalability.
For the Ecosystem at Large:
· Strengthen Academia-Industry Linkages: Drive commercial research relevant to local challenges in agriculture, health, and mineral beneficiation.
· Leverage the Diaspora Strategically: Engage diaspora professionals as operational partners in sectors like health, engineering, and maritime.
Conclusion
The year 2025 has demonstrated that Nigeria’s innovation narrative is expanding beyond fintech into the hard but necessary work of power, minerals, agriculture, and health. The policy direction shows awareness of the need for whole-economy transformation. However, the stark realities of infrastructure gaps, funding imbalances, and a low global innovation ranking persist. The journey into 2026 demands a strategic, integrated recalibration—one that leverages digital technology as an enabling layer for all sectors, unlocks climate finance, and decisively addresses the power crisis. By connecting these sectoral dots and harnessing Nigeria’s greatest asset—the ingenuity and resilience of its people—the nation can transition from a consumer of technology to a leading creator and exporter of innovative solutions for Africa and the world.
This article was contributed by the editorial team of ScienceAndTechConnect, led by Dr. Babajide Gboyega Alalade, as an independent review of Nigeria’s Science Engineering Technology and Innovation (SETI) landscape.