Nigerian tech manufacturers, Zinox and Omatek might become huge beneficiaries if Nigeria adopts China’s recent resolution to remove all foreign software and computer equipment from its government offices and public institutions amidst its trade-war with the United States. The Asian country is planning to replace all foreign technology by 2022 with a “3-5-2” strategy.
China is expected to get rid of 30% of foreign technology starting from next year. This move will affect several countries, most especially technology companies in the United States.
A blow to US companies
United States tech manufacturers have found the Asian country as a lucrative market with enormous market base. Companies like Microsoft, HP and Dell are likely to be negatively affected. US technology companies generate as much as $150 billion in annual revenues from China.
This decision, which was reportedly released by Chinese Communist Party’s Central Office earlier this year, is coming amidst the trade war involving China and the United States. US President, Donald Trump accused China of intellectual property theft, an allegation China has continued to deny.
The accusation has snowballed into a trade war, with both countries hitting each other with tariffs on various products imported from their respective countries. One of the major companies affected has been Huawei, which the US government accused of assisting the Chinese government to spy on its users. Huawei has, however, denied being an agent or tool of the Chinese government, stating that it operates as a private company. But still, the US has largely forced Huawei out of its market attributing its decision to national security.
[READ MORE: Trade conflict between United States, China continues to affect oil prices]
How the 3-5-2 strategy works
According to the News Agency of Nigeria (NAN) report, China is planning to phase out 30% of foreign software and computer equipment by 2020. 50% of these technologies will be removed in 2021 while 20% will be replaced by 2022. This house cleaning will happen in all government offices and public institutions.
What this means if Nigeria follows suit
Nigeria is very much dependent on foreign technology. This is why the indigenous technology companies like Zinox and Omatek are still struggling to compete even in Nigeria’s market. The local companies in China and the United States are market leaders above foreign competitors, but in Nigeria, some of the indigenous tech firms have been struggling to attract government and private patronage.
If the Nigerian government follows the path of China, replacing foreign software and computer equipment in its offices and public institutions with local technology manufacturers, it will boost sales of local firms and encourage new domestic companies to enter the market. It will also attract investors to invest in domestic companies to enable them to compete better.
Also, technology has been the driving force of development globally. It is also a tool that threatens national security. This is what some countries are trying to avoid. That’s why they are supporting their local tech manufacturers in order to reduce their dependence on foreign technology. If Nigeria reduces its dependence on foreign technology, it will not just secure the country’s intellectual property, it will also raise the sales of local tech manufacturers, and better position them in the local market.
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