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Friday, November 17, 2023

U.S. investments in African startups having very positive impact – Will Stevens

Will Stevens, US Consul General

OBINNA EZUGWU

Will Stevens ↗, the United States Consul General, has noted that at his country’s massive investments in African startups, particularly in the tech sector, is yielding positive results.

Stevens noted that technology is playing an ever-increasing role in the deepening of the U.S. – Nigeria relationship and the U.S relationships across the continent.

The Consul General who said in his keynote address
at the Global Tech Africa Conference with
the theme: “Africa’s Development and the Future of Tech: The U.S. Role” held on Lagos on Friday, noted thatbup to 60 percent of African startups are incorporated in the United States.

According to him, in 2021, African startups raised $4.8 billion, which translates to an average of over $1 million every 2 hours.

The United States, he said, “accounted for over 40 percent of Africa’s VC funding in 2022 with over $2 billion injected into local startups.”

“This year, while VC investments are globally on a decline, U.S. investors like Techstars, Y-Combinator, and 500 have closed over 100 major deals within the first 9 months of the year.”

His full speech below:

U.S. Consul General Will Stevens’ Keynote Address
At the Global Tech Africa Conference
Friday, November 17, 2023.
Keynote Theme: “Africa’s Development and the Future of Tech: The U.S. Role”
Lekki, Lagos
As Prepared for Delivery

Good morning, ladies and gentlemen, and distinguished guests. My name is Will Stevens; I am the Consul General at the U.S. Consulate here in Lagos. I would like to thank Inya and her amazing team at Ascend Studios Foundation for their work in making this three-day conference a reality. Special thanks to Director General Kashifu Inuwa Abdullahi of the National Information Technology Development Agency; Herbert Wigwe of the HOW Foundation and Wigwe University; Bunmi Akinyemiju of Venture Garden Group – our neighbor at the American Corner, Ikeja; Steffi Czerni of Digital Life Design; Mohamad Darwish of IHS Towers; RivExcel Health; and Business Sweden.

I am delighted to speak to you at this landmark event on the role of the United States in Africa’s Technological Development. Africa is home to some of the fastest-growing economies in the world.

From the hustle of Lagos to the shores of Cape Town, and all the wonders in-between, this endearing continent that I have come to call home for the past four years embodies huge untapped potentials in its peoples.

As the rest of the world grays, Africa blossoms with youth – and by 2050, one in four people on the planet will be African, a seismic change that is already beginning to take shape. You can feel it in the music, films, and fashion. You can see it in the entrepreneurial drive of the average African youth. According to a recent New York Times article, “the world is becoming more African.” The continent’s working-age population will hit one billion in the next decade – that is the future’s global workforce!
Nigeria is Africa’s largest economy and the seventh most populous country in the world, well on its way to becoming the third by 2050, according to data from the United Nations. The United States and Africa have enjoyed a long history of partnership. Core aspects of this relationship include seeking opportunities to increase two-way trade and investment, promote security cooperation, and support sustainable development.

Technology is playing an ever-increasing role in the deepening of the U.S. – Nigeria relationship and our relationships across the continent. We are using the latest technological innovations to address some of the world’s most pressing challenges, in the areas of education, healthcare, agriculture, and other vital areas of development and economic growth.

In education, the United States is supporting efforts to improve access to a quality education in Africa. Working with partners through some of our public diplomacy programs, such as the Mandela Washington Fellowship Program, Academy of Women Entrepreneurs, and TechWomen; as well as with American technology companies like Microsoft and Google, we have developed digital learning platforms, trained teachers on ways to use technology to enhance learning, and provided underserved students with access to computers and the internet.

In healthcare, we are working with Nigerian partners to develop electronic health records systems, train healthcare workers on how to use technology to deliver care, and provide Nigerians with access to affordable medicines and vaccines. Nigerian health technology companies such as Healthbotics and Helium Health have leveraged our programs and access to the United States to develop genius technologies that improve the overall healthcare system for underserved communities in Nigeria.

Additionally, the United States remains the largest single donor of bilateral aid to health in Nigeria, providing funding for primary healthcare programs, water and sanitation activities, infection prevention and control, malaria, HIV/AIDS, and general health assistance totaling over $15 billion in the last 20 years.

In agriculture, the United States is supporting African efforts to improve agricultural productivity, trade, and food security. Through our Foreign Agricultural Service and the U.S. African Development Foundation, we work with partners to develop new agricultural technologies, build trade capacity, and train farmers on how to use technology to improve their yields. Initiatives and programs such as the African Growth and Opportunity Act (AGOA) improve economic relations between the United States and the region by allowing duty free exports of over 1,800 locally sourced items; while programs such as the USAID-funded Feed the Future (FTF) are part of our numerous agricultural programs that are helping to improve bilateral trade and investment, provide quality plant seedlings and other agricultural inputs to farmers in West Africa.

The U.S. private sector also plays a vital role promoting technology in all sectors. U.S. venture capital firms are investing heavily in African tech startups with over 60 and 40 percent of venture capital funding in Nigeria and Africa respectively coming from the United States. Up to 60 percent of African startups are incorporated in the United States – this figure is 80 percent when considering Nigeria alone. In 2021, African startups raised $4.8 billion, this translates to an average of over $1 million every 2 hours! The United States accounted for over 40 percent of Africa’s VC funding in 2022 with over $2 billion injected into local startups. This year, while VC investments are globally on a decline, U.S. investors like Techstars, Y-Combinator, and 500 have closed over 100 major deals within the first 9 months of the year. By these numbers, it is indicative we have a strong interest in supporting the growth of the digital economy of the continent and clearly, Nigeria is a key market. As a whole, the U.S.-Africa startup/venture capital scene continues to be an immensely important mutually-beneficial bi-lateral corridor. At the Consulate here in Lagos, we work with numerous startups to facilitate their participation in incubator and accelerator programs, thereby connecting these Nigerian startups with global markets.

Beyond these staggering investment figures, U.S. investments in African startups are having a positive impact on the continent. Startups are creating not only jobs – but careers, boosting economic growth, and advancing innovation. Despite all of these successes, we believe it is still Day 1 in the African tech sector.

U.S. technology companies operating in Africa also play a crucial role in expanding the continent’s access to reliable and secure internet. Diaspora-led companies such as MainOne and other U.S. technology companies like Google and Meta, have invested millions and partnered with governments to land undersea cables to bring internet speeds of up to 180 terabits per second to Africa. Meta’s 2Africa cable – the largest subsea cable system in the world, with landings in Asia and Europe, is expected to land in 21 locations across 16 African countries including Nigeria in Lagos and Akwa Ibom. Early this year, SpaceX launched Starlink in Africa. Today, 7 countries have received the low earth orbit satellite-based internet access service, with an additional 25 countries targeted by the end of 2024. The U.S. Commerce Department works hand in hand with Nigerian companies to bring the latest U.S. technologies to Nigeria. The Commerce Department also brings Nigerian investors to the U.S. every year for the annual SelectUSA Investment Summit which includes special tracks, networks, and mentorship opportunities for tech and women-led tech startups who want to grow their business in the U.S.

One may wonder, why these investments in Africa? First, U.S. investors see the potential for high returns as African startups are growing rapidly with many of them disrupting traditional industries. The quality of African entrepreneurs is very impressive, and investors are confident in their ability to build successful businesses that provide solutions to not only African problems but global problems. The African technology ecosystem is a beacon of hope, a testament to the potential of a diverse continent, and a beaming light revealing what Africa could become.

Nigeria is reshaping the future of technology in Africa and its youth are changing the world. Our Deputy Assistant Secretary of State Joy Basu, who visited Abuja and Lagos last month to pursue opportunities to expand U.S.-Nigeria commercial and economic relationship, put it best when she said: “We owe it to the world to unleash Nigeria’s talent in service to solving the world’s greatest problems.” Recent visits by Treasury Deputy Secretary Wally Adeyemo and Assistant Secretary of State for Economic and Business Affairs Ramin Toloui echoed similar sentiments.

To close, the United States believes that a digital transformation is underway in Africa, and we are consciously seeking to bolster our collaboration with those of you represented here today. The Biden-Harris Administration developed a new initiative to enable this engagement. Launched by President Biden at the U.S.-Africa Business Forum in December 2022, the Digital Transformation with Africa (DTA) initiative seeks partnerships with African countries to expand digital access, increase U.S.-Africa commercial relations, support increased digital literacy, and strengthen digital enabling environments across the continent in line with the African Union’s Digital Transformation Strategy and the U.S. Strategy Toward Sub-Saharan Africa. This initiative emphasizes “with” – Digital Transformation “with” Africa, not “for” Africa; as we believe Africa brings tremendous value to the global table.

The United States government has already invested $350 million into digital programming and intends to invest millions more under this Initiative. The DTA will also facilitate more than $450 million in financing to develop an inclusive and resilient digital ecosystem in Africa; harness the tools and capabilities of 18 U.S. government departments and agencies; and partner with African governments and a wide variety of other actors – such as the private sector and civil society – to make these investments transformative.

The United States is invested in Nigeria’s technological success, and it is no exaggeration to say that Nigeria’s success is Africa’s success and Africa’s success is the world’s success. To realize this continent’s true potential in technology, we encourage you to leverage opportunities I shared today, and those tools found under the Prosper Africa initiative, including the Prosper Africa Tech for Trade Alliance, an initiative also announced in the 2022 U.S.-Africa Business Forum Deal Room, to advance e-commerce and digital.

We are committed to supporting Nigeria and Africa on its journey to prosperity. We believe that a strong and prosperous Africa is good for the United States, and good for the world! Thank you.

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James Mackreides
James Mackreides
'Mac' is a short tempered former helicopter pilot , now a writer based in Sofia, Bulgaria. Loves dogs, the outdoors and staying far away from the ocean.

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