In a recent report tagged, “The Contribution of Cloud to Economic Growth: Focus on Nigeria”, Amazon Web Services (AWS) revealed that Nigeria stands to gain an extraordinary N30.2 trillion in economic value between 2023 to 2033 through cloud adoption.
Cloud adoption has been a hot topic in recent years, with its myriad benefits for businesses being widely acknowledged. However, until now, understanding the true impact of cloud on an economy has remained somewhat elusive.
In the report, AWS said, “The Nigerian market to unlock N30.2 trillion of additional economic value over the next decade (2023-2033), representing 0.36 percent of Nigeria’s cumulative gross domestic product (GDP) by accelerating adoption of cloud.”
Meanwhile, Raul Katz, a director of Business Strategy Research at the Columbia Institute for Tele-Information at Columbia Business School (New York), explained that previous studies on the economic impact of cloud technology focused primarily on individual firms.
While these studies shed light on the microeconomic advantages of cloud adoption, they failed to capture the broader macroeconomic effects seen in other sectors such as broadband internet.
Determined to bridge this gap, Telecom Advisory Services embarked on an ambitious mission to develop a cutting-edge econometric model. By leveraging a rich global dataset from 2014 to 2021, this model allows for a comprehensive analysis of the relationship between cloud adoption, national productivity, and economic growth.
Raul said, “To address this gap, our team at Telecom Advisory Services developed a state-of-the-art econometric model, leveraging a global series of data on cloud adoption between 2014 and 2021.”
The report’s findings are nothing short of remarkable. It reveals that cloud adoption contributed 0.02 percent to the regional GDP, amounting to an economic value of N82.9 billion. Astonishingly, over 71 percent of this impact is attributed to national productivity gains.
Referred to as ‘spillover effects,’ these gains have a cascading influence on the wider economy. The remaining 29 percent stems from cloud spending by both public and private organizations.
AWS has calculated that, over the next decade, Nigeria stands poised to unlock N30.2 trillion of additional economic value. This represents a significant 0.36 percent of Nigeria’s cumulative gross domestic product (GDP).
More so, the general manager for Sub-Saharan Africa at AWS, Amrote Abdella said: “This report underscores the immense potential for Nigeria, and the SSA region, to harness cloud computing and expedite economic growth.
“By increasing the current average cloud penetration, the region can unlock additional economic value. AWS is committed to supporting its customers and partners in Nigeria throughout their cloud journey. We firmly believe that cloud technology will be crucial in driving innovation, boosting productivity, and scaling businesses in the region over the next decade.”