Nigeria Taps Microsoft to Oracle to Recover From Recession

(Bloomberg) -- Nigeria is hiring U.S. technology giants such as Oracle Corp. and Microsoft Corp. as the government invests more to save costs and fight corruption.

An initiative led by Redwood, California-based Oracle has enabled Nigerian authorities to remove 50,000 so-called ghost workers, or fake entries, from the payroll, according to a presidency statement June 29. That followed Oracle’s decision to open an office in Abuja, the capital, in May. Other companies interested in taking on more work in Nigeria include IBM Corp. and Sweden’s Ericsson AB, according to Yusuf Kazaure, managing director of state-owned Galaxy Backbone, which provides technology services to the government.

Galaxy Backbone’s budget has increased by 30 percent this year to 4 billion naira ($12.7 million), Kazaure said in a phone interview last month. State funding for the company will probably increase at a similar annual rate for the foreseeable future, he said. Nigeria is investing 50 percent more on information and communications technology infrastructure this year, totaling about 41 billion naira, according to budget data.

Africa’s most populous country is seeking to recover from its worst economic downturn in more than two decades and is using technology to improve government revenue collection and attract investment. The continent’s biggest oil producer is ranked 136 out of 167 countries on Transparency International’s 2016 Corruption Perceptions Index, a placing that may improve if the government is able to simplify processes such as the awarding of state permits, according to Hakeem Adeniji-Adele, director of public sector work at Microsoft Nigeria.

“The government’s digitization drive is imperative in cutting out the middle man,” he said in an emailed response to questions June 29. “The existence of middle men has left room for corrupt and illegal practices to thrive in the governance and doing business in Nigeria.” Microsoft sees an opportunity to advise and train users, Adeniji-Adele said.

Nigeria’s ministry of industry, trade and investment is in talks with Microsoft to improve e-services, which ties into the government’s objective to improve its World Bank Ease of Doing Business ranking, Constance Ikokwu, communication adviser to Minister Okey Enelamah, said in an emailed response to questions.

To contact the reporters on this story: Yinka Ibukun in Lagos at yibukun@bloomberg.net, Solape Renner in Lagos at srenner4@bloomberg.net.

To contact the editors responsible for this story: Karl Maier at kmaier2@bloomberg.net, John Bowker, Vernon Wessels