Japan and Nigeria sign MoU designed to provide funding for business start-ups and boost diversification

NIGERIA and Japan have signed a memorandum of understanding (MoU) designed to create an enabling environment for business start-ups to boost their innovative ideas and impact the country's economy.

Under the terms of the arrangement, groundbreaking projects valued at a total sum of $30.9m will be funded through the scheme. These will include instruments for the development of the start-up hub, which is being implemented by the National Information Technology Development Agency (Nitda) and valued at $9.9m.

This hub, which would be established in Abuja, would serve as a central node Nigeria's innovation ecosystem, providing entrepreneurs with access to essential resources, mentorship, networking opportunities, and technical support. Senator Abubakar Bagudu, the minister of budget and economic planning, signed the MoU on behalf of Nigeria, while Kozaki Hitoshi,  the deputy head of mission at the Japanese embassy signed on behalf of Japan.

A second intervention involves a project for the Development of Supporting Environment for Social Start-ups in Nigeria, implemented by the Nigeria Sovereign Investment Authority (NSIA) and valued at $21m. This is designed to support start-ups, complements the establishment of the start-up hub and aims to create a robust support structure for Nigerian entrepreneurs who are developing innovative solutions to pressing social challenges.

Senator Bagudu expressed gratitude to the Japanese government for the series of interventions being carried through the Japan International Cooperation Agency and the embassy, towards improving the quality of Nigerian lives. He said both interventions which are multi-sectoral are clearly aligned with the current administration’s Renewed Hope Agenda which implies that there is visible synergy between both countries.

Responding for Japan, Mr Hitoshi noted that both countries have enjoyed decades of fruitful partnership across many sectors, adding that their relationship continues to deepen and evolve, reflecting the shared commitment to sustainable development and mutual prosperity. He said the ceremony marked another significant milestone in the partnership between Nigeria and Japan.

Mr Hitoshi said: “I am excited to announce that the first project we are signing today focuses on establishing a start-up hub in Abuja. This hub will serve as a central node in Nigeria’s innovation ecosystem, providing entrepreneurs with access to essential resources, mentorship, networking opportunities, and technical support.

“We invest in this physical and institutional infrastructure to empower Nigerian innovators to transform their ideas into viable businesses that can create jobs, generate economic value and contribute to Nigeria’s national development priorities. This also marks a historic undertaking by the government of Japan to launch this type of fund project for the first time.

“What makes this project unique is that the Nigerian government itself will set up the fund with the aim of investing in start-up companies that solve social problems, co-funded equally by the Japanese and Nigerian governments. Given the time needed to foster start-ups working in social development, the fund will run for 13 years and NSIA will manage its operation."

He added that these two projects reflect Japan’s commitment to supporting Nigeria’s efforts to diversify her economy and harness the power of technology and innovation. According to Mr Hitoshi, Japan believes that by investing in Nigeria’s entrepreneurial talent, they are investing in the future of Africa’s largest economy and most populous nation.