NCC’s Executive Vice Chairman Reveals Telecom Sector’s Investment Crossing $75.6 Billion in Nigeria

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…As sector added N10.126 trillion to GDP in 2022

 

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

During an interactive session with stakeholders in the communications media ecosystem held in Lagos on Wednesday, Danbatta shared his achievements and significant developments that have shaped 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 official investment profile in the industry, surpassing the initial $70 billion investment over the past few years.

The calculation of investment in Nigeria’s telecommunications sector is derived from two sources: the Central Bank of Nigeria (CBN) and financial data obtained from service providers by the Commission. The CBN collects and calculates various elements of the telecoms sector, including FDI and portfolio investments, while the Commission gathers investment figures from domestic telecom licensees, which contribute to the total investment in the industry.

Danbatta emphasized that the effective regulatory environment established by the Commission has contributed to the tremendous growth of the telecom sector. The initial investment profile of $500 million in 2001, when the sector was fully liberalized, has seen substantial progress.

Furthermore, the telecom sector has become a significant contributor to Nigeria’s economy, with its quarterly 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 the nation’s GDP in 2022 alone.

Citing data from the National Bureau of Statistics (NBS), Danbatta highlighted that the telecoms sector made an aggregate quarterly contribution of N10.126 trillion to GDP in 2022. The first quarter contributed 12.94% equivalent to N2.246 trillion, while the second quarter reached an all-time high of 15% with a value of N2.593 trillion. In the third quarter, the sector’s contribution was 12.85%, and in the fourth quarter, it grew to 13.55%, valued at N2.436 trillion and N2.851 trillion, respectively.

In the first quarter of 2023, the telecommunications and Information Services sector in Nigeria delivered a financial value contribution of N2.508 trillion, representing 14.13% of the nation’s gross domestic product (GDP).

Since Prof. Danbatta assumed the role of EVC of NCC in August 2015, the telecoms sector’s contribution to national GDP has witnessed significant growth. It rose from 8.50% in 2015 to 9.13% in 2016, then reached 8.66% in 2017. In the last quarter of 2018, telecoms contributed 9.85% to national GDP, and it further increased to 10.60% in the fourth quarter of 2019. In the second quarter of 2020, it added 14.30% to GDP, and in the second quarter of 2021, the contribution was 14.42%. The highest quarterly contribution was recorded in the second quarter of 2022, reaching 15%.

READ ALSO THIS: “Unlocking Consumer Trust: Empowering the Digital Economy through Transparency and Accountability”.

Overall, Danbatta emphasized that the telecom sector has become a crucial driver of economic development in Nigeria, positively impacting all facets of the country’s economy. He expressed satisfaction with the sector’s phenomenal growth over the past two decades since its liberalization. However, he acknowledged the need for continued efforts to expand the industry’s frontiers and position Nigeria as a prominent player in the global digital economy.

Additionally, Danbatta shared statistics indicating the growth in active voice subscriptions, which reached 221.3 million (equivalent to 115.91% teledensity) as of May 2023. Internet subscriptions also rose to 159.6 million, while broadband subscriptions on 3G and 4G networks increased to 92.2 million, representing a 48.28% broadband penetration in the country. The introduction of 5G networks in Nigeria resulted in over 60,000 subscriptions in many cities across 12 states of the Federation.

Danbatta assured stakeholders of the Commission’s commitment to fostering a favorable investment climate in Nigeria, aligning with the Federal Government’s policies focused on Ease of Doing Business and the digital economy. He expressed gratitude to the media for their role as strategic partners and enablers of growth in the telecom sector through accurate and timely reporting of the Commission’s regulatory activities.

 


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