The Nigerian telecommunications sector is a major driver of the country’s economy, contributing 16% to the Gross Domestic Product (GDP) in the second quarter of 2023 (Q2, 2023). This represents a significant increase from the 8% contribution in 2015, when the current Executive Vice Chairman and Chief Executive Officer (VC/CEO) of the Nigerian Communications Commission (NCC), Professor Umar Danbatta, assumed office.
The growth of the telecoms sector is being driven by a number of factors, including increased investment, improved regulatory standards, and digital innovation. In the first quarter of 2023, the sector contributed ₦2.508 trillion to the nation’s GDP, representing a 4.3% increase from the previous quarter and a 9.9% increase from the same period in 2022.
The NCC has played a key role in supporting the growth of the telecoms sector through its regulatory interventions. For example, the commission has implemented a number of policies to encourage investment in the sector, such as the National Broadband Plan 2020-2025 and the Revised National Telecommunications Policy 2021.
The NCC has also been working to improve the quality of service in the sector and to protect the rights of consumers. For example, the commission has implemented a number of measures to address the issue of call drops, and it has also established a Consumer Protection Bureau to handle complaints from consumers.
Despite the growth of the telecoms sector, there are still a number of challenges that need to be addressed. These include the Right of Way (RoW) issue, fiber cuts, high capital requirement for deployment, multiple taxation and regulations.
The NCC is working to address these challenges in collaboration with other stakeholders. For example, the commission is working with the federal government to secure a uniform RoW charge across the country. The NCC is also working with the industry to develop a sustainable model for funding the deployment of broadband infrastructure.
The growth of the telecoms sector is having a positive impact on all aspects of the Nigerian economy. The sector is creating jobs, boosting innovation, and helping to connect people and businesses across the country.
How the Telecoms Sector is Boosting the Nigerian Economy
The telecoms sector is boosting the Nigerian economy in a number of ways:
- Creating jobs: The telecoms sector is one of the largest employers of labor in Nigeria. The sector directly employed over 2 million people in 2022, and it is estimated that it indirectly employed over 10 million people.
- Boosting innovation: The telecoms sector is a major driver of innovation in Nigeria. The sector is constantly developing new products and services that are helping to improve the lives of Nigerians. For example, the telecoms sector has played a key role in the development of mobile banking and e-commerce in Nigeria.
- Connecting people and businesses: The telecoms sector is helping to connect people and businesses across Nigeria. This is helping to improve communication and collaboration, and it is also helping to boost economic activity. For example, the telecoms sector has played a key role in the development of Nigeria’s e-commerce sector.
Challenges Facing the Telecoms Sector
Despite the growth of the telecoms sector, there are still a number of challenges that need to be addressed. These include:
- The Right of Way (RoW) issue: The RoW issue is a major challenge for the deployment of broadband infrastructure in Nigeria. The RoW is the permission that telecom operators need to lay fiber optic cables on government land. In the past, telecom operators have had to pay high fees to state and local governments to obtain RoW permits. This has made it difficult for operators to deploy broadband infrastructure in rural areas.
- Fiber cuts: Fiber cuts are another major challenge for the telecoms sector. Fiber cuts are often caused by construction activities and by theft. Fiber cuts can disrupt telecom services and can lead to financial losses for operators.
- High capital requirement for deployment: The deployment of broadband infrastructure requires a high capital investment. This can be a challenge for telecom operators, especially in developing countries like Nigeria.
- Multiple taxation and regulations: Telecom operators in Nigeria are subject to multiple taxes and regulations. This can add to the cost of doing business and can make it difficult for operators to invest in the sector.
Conclusion
The telecoms sector is a major driver of the Nigerian economy. The sector is creating jobs
