Nigeria is among the five Sub-Saharan African countries best positioned to benefit from the growing adoption of artificial intelligence (AI), according to a new report by the International Monetary Fund (IMF), which says the country has greater potential than most of the region to translate AI into productivity and economic growth.

The IMF, in its report titled Unlocking the Potential: AI in Sub-Saharan Africa, identifies Nigeria alongside South Africa, Mauritius, Botswana and Namibia as the economies expected to record the largest AI-driven productivity gains under current conditions. South Africa is projected to lead the region, followed by Mauritius, with Nigeria ranking among the top performers.

Despite Nigeria’s favourable position, the IMF cautions that the projected gains remain modest compared with advanced economies because of low AI adoption, infrastructure deficits and limited digital preparedness across the region.

“These estimates should be interpreted as a current-conditions diagnostic rather than a forecast of AI’s technological potential. They reflect today’s low adoption, infrastructure gaps, and sectoral structure; they do not capture the full range of gains that could arise from faster diffusion, structural transformation, public sector applications, or AI-enabled innovation,” the report says.

“These estimates should be interpreted as a current-conditions diagnostic rather than a forecast of AI’s technological potential. They reflect today’s low adoption, infrastructure gaps, and sectoral structure; they do not capture the full range of gains that could arise from faster diffusion, structural transformation, public sector applications, or AI-enabled innovation,” the report says.

Nigeria among Africa’s AI frontrunners

The IMF attributes Nigeria’s relatively strong outlook to the structure of its economy, which has a larger share of sectors such as information and communication technology (ICT), finance and professional services than many other Sub-Saharan African countries.

These sectors are considered more exposed to AI because they rely heavily on knowledge-intensive and information-processing tasks that can be enhanced or automated using AI technologies.

While agriculture and informal services continue to dominate employment across much of the region, the report notes that job composition in Botswana, Mauritius, Namibia, Nigeria, Seychelles and South Africa more closely resembles that of emerging market economies, placing them in a stronger position to benefit from AI adoption.

According to the IMF, three factors will determine the scale of AI’s economic impact: the proportion of tasks exposed to AI, the rate at which businesses and workers adopt the technology, and the productivity improvements generated through its use.

Productivity gains remain limited

Although Nigeria ranks among the continent’s strongest performers, the IMF projects that productivity gains across Sub-Saharan Africa will remain significantly below those of advanced economies unless governments address critical barriers to AI adoption.

The report estimates that AI will increase productivity across Sub-Saharan Africa by only 0.2% cumulatively over the next decade under current conditions, compared with around 1% in Europe and the Western Hemisphere. When additional AI-related investment is factored in, the technology could contribute an overall cumulative GDP growth effect of about 0.4% over the same period.

The IMF says these projections reflect today’s realities rather than AI’s long-term capabilities.

Infrastructure challenges remain

The report identifies unreliable electricity, limited broadband connectivity, inadequate data centre capacity, shortages of AI skills and constrained investment as the principal obstacles preventing countries from unlocking AI’s full economic potential.

It notes that AI adoption across Sub-Saharan Africa remains below 10%, about two to three times lower than in Europe and the Western Hemisphere, while internet usage and access to reliable electricity also lag global averages.

Human capital also remains a challenge. According to the report, fewer than one-quarter of higher education students in Sub-Saharan Africa study science, technology, engineering and mathematics (STEM) disciplines, while only about 5% of the continent’s AI researchers have reliable access to the high-performance computing needed for advanced AI research.

Greater gains possible

Despite the current constraints, the IMF says the region has significant room to improve if governments accelerate AI adoption and strengthen enabling infrastructure.

“The barriers to AI adoption in Sub-Saharan Africa are real and represent binding constraints at present. But they are barriers, not boundaries features of the current moment. Relax those assumptions, and the numbers could change substantially,” the report says.

The IMF adds that raising AI adoption rates to levels seen in other emerging and advanced economies could more than double the region’s productivity gains over the next decade.

“If current adoption rates were lifted to levels observed in other emerging and advanced economies, productivity gains could more than double, increasing by an additional 0.8 percent over the next decade,” the report says.

Opportunity for Nigeria

For Nigeria, the findings reinforce the country’s growing position as one of Africa’s emerging AI hubs. The report highlights the country’s expanding technology ecosystem and references the Federal Government’s Three Million Technical Talent (3MTT) programme as an important initiative aimed at strengthening digital and technical skills. However, it says investments in electricity, broadband infrastructure, computing capacity and AI talent will be essential for the country to fully capitalise on the technology.

The IMF concludes that while Nigeria is among Africa’s biggest potential AI beneficiaries, translating that potential into measurable economic gains will depend on sustained investments in digital infrastructure, supportive policies and wider adoption of AI across both the public and private sectors.