Kola Aina, founding partner of Venture Platform, says the freeze on United States Agency for International Development (USAID) programmes and the US trade policies have contributed to a slowdown in Africa’s startup ecosystem.
Aina spoke on Monday during the African Private Capital Association (AVCA) press conference in Lagos.
On February 2, US President Donald Trump signed economic orders imposing significant new tariffs on Canada, Mexico, and China.
According to the Trump administration, the tariffs intend to curb the inflow of drugs and undocumented immigrants.
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Aina said the uncertainty surrounding the US government’s direction has discouraged some investors, slowing the momentum that once helped catalyse startup valuations across the continent.
“The uncertainty certainly doesn’t help,” he said.
“The startup ecosystem benefited from the participation of US investors that helped catalyse valuations or in some cases, over-evaluations, here in Africa, and so we’ve definitely seen some slowdown as people try to figure out what the government’s direction of travel is.
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“In terms of USAID, I think a decent part of the earlier-stage incubation and acceleration activity was partly supported by USAID funding.
“Unfortunately, I know I can count a couple of programmes that had to stop work effectively as an outcome of that.”
The founder said the development underscores the need for Africa to look inward and focus more on intra-continental trade and investment rather than external support.
“We can’t perpetually rely on the benevolence of the US or the partners. The conversation has to shift to trade and investment,” Aina added.
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He said Nigeria’s government, particularly the ministry of trade and investment, has been placing more emphasis on this shift, especially in the context of the African Continental Free Trade Area (AfCFTA).
Aina stressed that much more can be achieved through greater collaboration among African nations.
