Nigeria’s proposed Artificial Intelligence (AI) Bill is emerging at a critical turning point in the country’s technological journey.
As global AI competition intensifies and local developers experiment with new breakthroughs, the legislation is being framed as the blueprint that will guide Africa’s largest economy into the next era of digital innovation. Yet behind the bold promises lies a deeper question that is sharply dividing policymakers and innovators: Will this bill unlock Nigeria’s AI potential or trap it behind layers of regulation?
A review of the draft law, alongside interviews and analyses comparing it with global frameworks such as the EU AI Act and the Alliance4AI guidelines, reveals a document torn between two priorities. On one hand, the bill aims to shield Nigerians from harmful automated systems, algorithmic discrimination, and data misuse. On the other, it is expected to fuel an AI-powered economic uplift driven by Nigerian engineers, startups, and researchers. How Nigeria reconciles these opposing visions will determine whether the bill accelerates or restrains the country’s digital ambitions.
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Anda Usman, Co-founder and CEO of Datum Africa, is among those warning that Nigeria risks repeating past mistakes.
“When regulation comes too early and too heavy, you end up consuming other people’s technology instead of building your own,” he said.
A Framework Prioritising Control Over Creativity?
At surface level, the bill appears to modernise AI governance by establishing oversight for high-risk systems, mandating accountability, and mirroring global regulatory architecture. But deeper scrutiny suggests a heavy tilt toward bureaucratic control. Significant power is vested in government agencies with limited technical capacity, while the licensing structure threatens to introduce compliance costs that many early-stage AI builders simply cannot meet.
Usman argues that Nigeria is modelling its approach after the European Union, known for strict regulation, rather than innovation-driven ecosystems like the United States.
This comes as the EU itself is reportedly preparing to revisit and simplify parts of the GDPR and AI Act framework, a telling sign that even global leaders are adjusting their regulatory grip.
Unlike countries such as the U.S., UK, Singapore, or the African Union’s evolving AI framework, Nigeria’s bill adopts a risk-based model without the necessary support systems. There are no sandboxes, grants, incentives, community learning programs, or startup-friendly compliance pathways to balance the regulatory load.
Alex Tsado, founder of Alliance4AI, bluntly captures the concern:
“Nigeria is about to regulate innovation before enabling it.”
The Licensing Bottleneck
The bill’s most controversial provision is its licensing regime. Developers building or deploying certain AI systems must obtain licences which often requires fees, extensive documentation, audits, and continuous oversight. While global tech giants can easily comply, local startups, research institutions, and independent developers cannot.
This raises a pivotal question: Is the bill designed for innovators or merely for regulators?
Some, like digital industries executive John Wambugu, praise the introduction of an AI Council for improved coordination and transparency. But critics argue that the cost and complexity of compliance will push local builders out of the ecosystem and leave Nigeria dependent on foreign technology.
This dynamic risks turning Nigeria into the very thing innovators fear: a buyer of imported AI solutions rather than a producer of homegrown systems.
A Blind Spot: No Category for Foundational Models
Another weakness is the bill’s failure to address foundational AI models in a large-scale systems such as GPT-4 or emerging African LLMs. Globally, foundational models receive special regulatory treatment because of their broad capabilities and risks. Nigeria’s bill, however, treats AI systems generically, leaving classification to regulator discretion.
This creates uncertainty for local developers planning model training pipelines or infrastructure investments, especially in a country with expensive cloud compute, limited GPUs, and unstable electricity. Meanwhile, foreign companies can operate outside Nigeria and merely sell into the market—avoiding local constraints entirely.
Missing: Support for Local Innovation
Perhaps the most striking gap in the bill is what it doesn’t offer. There are no incentives, funding structures, tax benefits, national compute projects, or education initiatives to grow local AI capacity. Unlike the EU, UAE, or Singapore, Nigeria is not pairing regulation with substantial investment.
There are no provisions for:
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Open government datasets
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GPU credits or national compute centres
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Academic–industry collaboration programs
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Fellowships or scholarships
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Ethical AI training
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Startup tax incentives
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AI research grants
Instead, the bill prioritises enforcement, prohibitions, and licensing—creating a heavy regulatory machine with no mechanisms to lift innovators along with it.
As Tsado puts it:
“Nigeria is regulating without enabling—controlling without empowering.”
Centralisation of Power and Regulatory Risk
The proposed AI agency would wield broad discretionary powers: deciding what qualifies as high-risk, issuing licences, setting standards, and administering penalties. Without strong guardrails, this concentration of authority could lead to regulatory overreach or bottlenecks that stall innovation.
“When innovation requires permission, innovation becomes fragile,” Tsado warned.
Startups cannot afford month-long delays waiting for approval to build or launch products. The likely outcome?
Ambitious founders will relocate to friendlier markets.
Foreign Firms Stand To Benefit the Most
A critical irony of the bill is that it will be easier for foreign companies to comply than for Nigerian startups. International tech giants already have compliance teams, safety documentation pipelines, and audit-ready systems. Local developers do not.
This creates an uneven playing field, one that strengthens foreign dominance while shrinking opportunities for domestic innovation.
Wambugu suggests lighter rules for startups to avoid suffocating the ecosystem, while Tsado argues for a dual approach:
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Minimal regulation for academic and early-stage local projects
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Strict oversight and taxation for foreign models operating in Nigeria
Without such differentiation, Nigeria risks becoming permanently dependent on imported AI technologies.
A Pivotal Decision for Nigeria’s Future
Virtually everyone agrees that AI should be regulated. The real debate is how to regulate it.
Nigeria now stands at a crossroads:
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Will it choose a model that protects citizens while giving local builders space to innovate?
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Or a model that prioritises control at the expense of homegrown talent, deepening dependence on foreign technology?
The direction Nigeria chooses will shape its place in the global AI landscape for decades—determining whether the nation becomes a hub of innovation or a passive consumer in the accelerating AI revolution.
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