Nigeria Poised to Enact Comprehensive AI Regulations for the Digital Economy

Nigeria Moves Toward Pioneering AI Regulation

Nigeria is on track to become one of Africa’s first nations to introduce comprehensive oversight for artificial intelligence, aiming to bring order to a rapidly expanding digital sector that has so far operated with minimal restrictions from international tech companies.

The proposed National Digital Economy and E-Governance Bill would empower authorities to oversee data, algorithms, and digital platforms—addressing a regulatory gap that has existed since the country released its draft AI strategy in 2024.

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Key Provisions of the Bill

Lawmakers anticipate passing the legislation by the end of March. The bill would require stricter oversight for high-risk AI applications—such as those used in banking, government, surveillance, and automated decision-making. Developers of these systems would need to submit yearly reports detailing potential risks, mitigation strategies, and system performance.

Regulators would also have the authority to impose penalties of up to 10 million naira (approximately $7,000) or 2% of a provider’s annual Nigerian revenue, though the criteria for determining fines remain unspecified.

Proactive Approach to AI Oversight

Kashifu Abdullahi, head of the National Information Technology Development Agency, explained that the goal is to establish regulatory measures before AI becomes deeply entrenched in sectors like finance and public services. Unlike other African countries—such as Mauritius, Egypt, and Benin—which have AI strategies but lack broad legislation, Nigeria’s bill would introduce a nationwide regulatory framework for artificial intelligence.

The proposed law would also introduce ethical guidelines for transparency, fairness, and accountability, adopting a risk-based model similar to those being developed in Europe and Asia. This could significantly influence how both global and regional tech companies operate within Nigeria.

“When it comes to governance, it’s crucial to establish safeguards to ensure AI development remains within safe boundaries,” Abdullahi stated. “This approach makes it easier to identify and address any misuse.”

The bill further grants regulators the power to request information, issue enforcement actions, and suspend or limit AI systems that are considered unsafe or non-compliant. It also proposes the creation of controlled environments where startups and research institutions can experiment with new AI technologies under regulatory supervision, encouraging responsible innovation.

Perspectives on Regulation and Innovation

“Regulation isn’t just about imposing rules—it’s about shaping market, economic, and social behavior to ensure AI is developed for the benefit of society,” Abdullahi emphasized. “You can’t outpace innovation, but you can guide it.”

Reporting assistance by Julius Domoney.

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