Nigeria set to become 1st African nation to adopt economy-wide regulatory regime for AI

Nigeria is preparing to introduce sweeping legislation that would position it among the first African countries to comprehensively regulate artificial intelligence (AI), as authorities seek to bring oversight to one of the continent’s fastest-growing digital markets.

The proposed National Digital Economy and E-Governance Bill is expected to be passed by lawmakers before the end of March. If approved, it would grant regulators broad powers over data use, algorithms and digital platforms, addressing regulatory gaps that have persisted since Nigeria released a draft national AI strategy in 2024.

Under the bill, higher-risk artificial intelligence systems, including those deployed in finance, public administration, surveillance and automated decision-making, would face stricter supervision. Developers of such systems would be required to submit annual impact assessments detailing potential risks, mitigation strategies and system performance.

The legislation also empowers regulators to impose penalties of up to 10 million naira ($7,000) or 2% of an AI provider’s annual gross revenue generated in Nigeria, although the framework does not yet specify how sanctions would be calculated or enforced.

According to Kashifu Abdullahi, Director-General of the National Information Technology Development Agency (NITDA), the bill is designed to regulate AI proactively rather than respond after problems emerge, as adoption accelerates across the financial sector, public services and private enterprises.

“If passed, this will make Nigeria one of the first African countries to adopt an economy-wide regulatory framework for artificial intelligence,” Abdullahi said to Bloomberg. While several African nations, including Mauritius, Egypt and Benin, have developed AI strategies, most lack binding legislation governing its use.

The proposed law establishes ethical principles focused on transparency, fairness and accountability, and introduces a risk-based regulatory approach similar to emerging models in Europe and parts of Asia. Analysts say this could significantly influence how global technology firms, from US-based companies to Chinese cloud providers, operate in Africa’s most populous country.

“In governance, we must put safeguards and guardrails in place to ensure the AI we develop operates responsibly,” Abdullahi said, adding that the framework would help authorities quickly identify and contain harmful or non-compliant systems.

The bill would also allow regulators to demand information from AI providers, issue enforcement directives, and suspend or restrict systems considered unsafe. In addition, it proposes the creation of controlled testing environments or regulatory sandboxes where startups and research institutions can trial AI technologies under supervision to encourage innovation.

“Regulation is not just about issuing commands,” Abdullahi noted. “It’s about shaping economic and societal behaviour so that people can build AI for the public good.”

If enacted, the legislation could mark a significant shift in how digital technologies are governed in Nigeria and potentially set a precedent for AI regulation across Africa.