Nigeria’s ICT sector is set for a boom after the government announced plans to launch a $15-million venture fund, CP Africa reports.

The fund will be dedicated for high potential businesses in the information and communications technology (ICT) sector and will be sourced from the National Information Development Agency (NITDA) and the private sector. NITDA will contribute about $3.6 million.

Mrs. Omobola Johnson, Nigeria’s Information and Communications Technology Minister said the fund will be run by independent fund managers working with the ICT incubation team, added the report. The two will identify viable projects to fund.

Mrs. Johnson added they would fund the initiatives until they are commercially viable.

She said: “We use those capital development fund to fund the development of those ideas until they get a commercial viability. Basically, the reward is when they get a commercial viability and you sell them off or you do an IPO like they do with Facebook and all those companies where the returns go to the investors and the fund.”

The minister said the fund is initially $15 million and additional money would be raised. “The anchor investor in that fund is going to be Federal Government,” she said.

Just recently, Florence Seriki, the Group Managing Director, Omatek Computers Plc, blamed inadequate funding for the sector’s little capacity. She said the local firms fail to produce the quantity demanded by the government as they lacked funds to finance their operations and asked the government to intervene.

Apart from financing, Seriki also asked the government to give subsidies to the indigenous manufacturers to help them compete with multinational firms. Funding is a local challenge as banks cannot fund hardware makers and besides, the interest on loans starts from 20 percent.

Seriki asked the Government to help the firms compete favorably to which the minister remarked the government had such plans.

Image credit: Stan Dalone

This story originally appeared on HumanIPO.

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