Telecoms, key to economic survival

No doubt, Nigeria is rated one of the fastest telecommunications markets in Africa, contributes 11 per cent to the nation’s Gross Domestic Product (GDP), but the industry continues to be surmounted by challenges.

The challenges including multiple taxation, theft and vandalisation have become hydra-headed demon that have continued to plague the operators , many of whom had had to lick their wounds silently, sometimes, moan under the sword of Damocles from the telecoms umpire for failing to meet the Key Performance Indicator (KPI) at some point .
Industry watchers noted that the sector is impacting significantly on the overall economy because of the rising demands for telecommunications services. They insisted that the $32billion sector requires increased protection from the federal government because it has become key to economic survival.
Stakeholders are of the view that the sector should be guarded jealously, while canvassing for foreign investors to invest in untapped opportunities in the industry. They noted that challenges including vandalism, theft, Right of Way (RoW), are impediments that can affect deeper telecoms penetration and as such all hands should be to the pump to ensure that all these are weeded out.
On his part, President, Association of Telecoms Companies (ATCON), Mr. Lanre Ajayi, disclosed that there is still latent demand for telecoms services, as such the telecoms sector has become the livewire of the economy.
“And it is significantly impacting on other sectors of the economy. For instance, the broadband sector has been proven to be a key enabler of a national economy. So, we still believe that despite our teledensity indicating over 107 per cent, at least based on the number of telephone subscriptions, there are a lot of people who still do not have access to telecoms services and there is a need for government to remove all observed impediments to deepen telecoms penetration,” he said.
With the importance attached to the sector, the telecommunications regulator, Nigerian Communications Commission (NCC), is working at ensuring that the industry surpasses the 25 per cent contribution to the country’s Gross Domestic Product (GDP) by 2025.
With a rising subscriber growth of over 150 million and a teledensity of 107.67 per cent as at July, 2015, NCC insists that over 25 per cent is achievable in the next 10 years.
Acting Executive Vice Chairman of NCC, Prof. Umar Danbatta, stated during an industry forum that Nigeria’s telecom sector is one of the fastest growing in the world, saying, “Telecommunications is obviously leading as the aggregate Foreign Direct Investments (FDI) from 2007 to 2013, and ranked as a contributor of 24 per cent of such projects. Between 2011 and 2013, telecommunications sector attracted about $6 billion worth of investments, which has accelerated information and communications technology (ICT) contributions to an estimated 10 per cent, translating to some $50 billion.”
Danbatta further stated that it is the position of the regulator to accurately make a long-term prediction of what the sector of a hugely diverse economy like Nigeria would be in ten years. It is also appropriate to make a prediction where other sectors of the economy are intensely competing to contribute.
“The role of the telecoms regulator is to continue to provide the type of environment that will continue to encourage investment and growth. There is no doubt that this is the reason for the exponential growth in active subscriber statistics of more than 150 million lines and teledensity of 107 per cent. This is not comparable with 400,000 lines in 2001. It is not by accident that more than 80 million Nigerians have access to the internet today. These are products of robust regulatory processes”.
The NCC boss also hinted that the telecoms regulator is desirous of the ICT sector contributing even more than 25 per cent to GDP by 2025. At the current contribution estimated at 10 per cent, this implies achieving additional 15 per cent over the next 10 years. “This is by no means a very tall order, given what we have said about the competition sectors of the economy, which is for the good of the nation on the long run. However, any consideration of achieving such a feat must also give consideration to putting a robust plan, with long, medium and short-term measures in place to attract and sustain investments. In the ICT sector, it is all about investments. It could be investment in infrastructure, content, human capital, and supportive infrastructure availability, especially power as it relates to the sector.
“To surpass the 25 per cent contribution to GDP by 2025, a strategic plan was already in place that projects achievement of 30 per cent of broadband penetration by 2018. If this is achieved, it surely would fast track the contribution of the ICT sector to GDP and surpass the 25 per cent contribution to GDP. I am confident of this projection because broadband will energise the sector and the economy. Most of the activities in the industry will be electronic driven. Digital warriors who will drive local content will emerge, and formal and informal employments would be created.  Commerce will thrive more on the digital space. Education and health sectors will receive a boost and governance will even come closer to the citizenry as government and its agencies will begin to run on complete e-platforms