• Tue. Jun 25th, 2024

Danbatta Announces Telecoms Investment In Nigeria Soars To $75.6 Billion

ByHybrid News

Jul 5, 2023

L-R: Mustapha Isa, Former President, Nigerian Guild of Editors (NGE); Ochereome Nnanna, Chairman, Editorial Board, Vanguard Newspapers; Prof. Umar Danbatta, Executive Vice Chairman/Chief Executive Officer, Nigerian Communications Commission (NCC); Sam Omatseye, Chairman, Editorial Board, The Nation Newspapers and Usman Malah, Director, Human Capital and Administration, NCC at a media roundtable organised by the Commission in Lagos on Wednesday (July 5, 2023).

The Nigerian Communications Commission (NCC) Executive Vice Chairman (EVC), Prof. Umar Garba Danbatta, has officially declared that the total investment in Nigeria’s telecommunications sector, comprising both foreign direct investment (FDI) and local investment, has reached $75.6 billion as of 2021.

Danbatta disclosed this during an interactive session with stakeholders in the communications media ecosystem in Lagos on Wednesday.

He presented his achievements and significant developments that have influenced the growth of the telecoms sector since he assumed the role of chief telecom regulator in August 2015.

According to Danbatta, the investment profile in the sector was $68 billion in 2018, which increased to $70.5 billion in 2019 and $72 billion in 2020. By the end of 2021, the figure had risen to $75,560,563,417.79 ($75.6 billion). This latest figure represents the current official investment profile, surpassing the initial $70 billion investment made over the past few years.

Investment in Nigeria’s telecommunications sector is calculated from two sources: the Central Bank of Nigeria (CBN) and financial data obtained from service providers by the NCC.

The CBN collects and calculates various elements of the telecoms sector, including FDI and portfolio investments. Meanwhile, the NCC collects investment figures from domestic telecom licensees, which encompass capital expenditure (CAPEX) and contribute to the overall investment in the industry.

Danbatta attributed the substantial growth in the telecom sector to the effective regulatory environment established by the NCC. He highlighted that the sector has experienced remarkable progress, starting from an initial investment profile of $500 million in 2001 when the sector was fully liberalized.

Moreover, Danbatta emphasized that the telecom sector continues to be a significant contributor to Nigeria’s economy, with its sectoral contribution to the nation’s Gross Domestic Product (GDP) steadily increasing. From approximately 8.5% in the third quarter of 2015, the sector contributed N10.126 trillion to Nigeria’s GDP in 2022 alone, as per data from the National Bureau of Statistics (NBS).

“In the first quarter, the sector contributed 12.94 per cent equivalent to N2.246 trillion while the second quarter witnessed an all-time high GDP contribution by the telecom sector to the nation’s economy, standing at 15 per cent and valued at N2.593 trillion. The sector’s contribution to GDP in the third was 12.85 per cent and in the fourth quarter, it grew to 13.55 per cent, which are valued at N2.436 trillion and N2.851 trillion respectively.

“The growth trajectory continued this year as telecommunications and Information Services sector in Nigeria delivered a handsome N2. 508 trillion in terms of financial value contribution to the nation’s gross domestic product, GDP, representing 14.13% in the first quarter 2023,”he said.

According to available data from the National Bureau of Statistics (NBS), the contribution of the telecommunications sector to Nigeria’s national GDP has experienced significant growth since Prof. Danbatta assumed the position of Executive Vice Chairman (EVC) of the Nigerian Communications Commission (NCC) in August 2015.
In 2015, the telecoms sector contributed 8.50 percent to the national GDP. This figure increased to 9.13 percent in 2016 and then slightly decreased to 8.66 percent in 2017. However, in the last quarter of 2018, the sector’s contribution rose to 9.85 percent, and it further increased to 10.60 percent in the fourth quarter of 2019.

Notably, in the second quarter of 2020, the telecoms sector made a significant leap by contributing 14.30 percent to the GDP. This positive trend continued in the second quarter of 2021 with a contribution of 14.42 percent. The highest quarterly contribution to the GDP by the sector occurred in the second quarter of 2022, reaching 15 percent.

Overall, Prof. Danbatta emphasized that the telecoms sector has emerged as a crucial driver of economic development in Nigeria, positively influencing all aspects of the Nigerian economy.

“As the regulatory authority for the telecom sector in Nigeria, we are happy that the sector has recorded phenomenal growth statistics in the past two decades of the liberalization of the telecoms sector. However, we will not rest on our oars. We will continue to push upward to greater heights by encouraging expansion of frontiers to put Nigeria’s imprint on the global map of digital economy,” he noted

Danbatta, the CEO of NCC, highlighted the remarkable progress in investment and GDP contribution, stating that as of May 2023, active voice subscriptions had reached 221.3 million, equivalent to a teledensity of 115.91 percent. Internet subscriptions also rose to 159.6 million.

Furthermore, broadband subscriptions on 3G and 4G networks experienced significant growth, reaching 92.2 million, which represents a broadband penetration rate of 48.28 percent in the country.

In addition, the deployment of 5G networks in Nigeria, facilitated by the issuance of 3.5GHz spectrum licenses, has led to impressive results.

With ultra-high speed internet, low latency, and high capacity, over 60,000 5G subscriptions have been recorded in numerous cities across at least 12 states of the Federation. Two out of the three license holders have already launched commercial 5G services.

Danbatta emphasized the NCC’s unwavering commitment to supporting the Federal Government’s Executive Order 001, which focuses on Ease of Doing Business and other digital economy-oriented policies.

The commission will continue to implement regulatory initiatives that foster a favorable investment climate for telecom investors in Nigeria and provide enhanced value for money for telecom consumers.

The EVC expressed gratitude to the media for their crucial role as strategic partners in driving growth within the telecom sector. Their accurate, adequate, and timely reporting of the Commission’s regulatory activities greatly contributes to the sector’s development.

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