On June 5, 2024, prominent figures from the Private Sector came together for a breakfast meeting at the Lagos Business School, Pan-Atlantic University. The focus of the discussion revolved around the importance of the Telecom Sector as a driving force for Economic Growth in Nigeria. During his keynote speech, CEO Bismarck Rewane from Financial Derivatives Company stressed the importance of the telecom sector in spurring economic growth, promoting innovation, and increasing Productivity in different fields.
During his talk titled “Nigerian Economy on the Brink, Adapt or Collapse?”, Rewane outlined the obstacles facing the sector, such as increasing Inflation rates, expensive operating expenses, restricted access to foreign currency, regulatory obstacles, numerous Tax requirements, and extortion by state and local governments. He emphasized how these obstacles pose a threat to the industry’s progress and expansion by referencing the financial loss reported by MTN in the year 2023. The telecommunications companies are advocating for Tariffs that reflect actual costs, a move that is supported by the expert’s opinion in light of challenging economic conditions.
Growth in one industry can lead to growth in other industries.
Rewane pointed out the negative effects the current situation is having on the growth and progress of the sector, cautioning that the telecoms industry may soon see a decline in Revenue which could then affect other sectors in a chain reaction. The concept of the Big Push theory suggests that when one industry experiences growth, it can lead to growth in other industries due to connections in both directions. In particular, the telecommunications industry has connections that support other industries, playing a crucial role in economic growth, innovation, and productivity across different sectors.
These linkages make the telecom sector a crucial driving force for development in contemporary economies. He emphasized the interconnectedness of industries, stating that a collapse in the telecom industry would have a ripple effect on all other sectors. Prof. Ali Bongo and several other distinguished speakers reiterated the opinions expressed by Rewane, emphasizing the importance of government assistance and the relaxation of regulations to guarantee the industry’s Sustainability. They also emphasized the promising future of the industry.
Experts are sounding the alarm about the future of Nigeria’s economy.
In their statements, they noted that it is expected to outperform the GDP growth rate by 8% from 2019 to 2023. During the event, the telecom sector in Nigeria was analysed for its important contribution to economic progress and advancement, with stakeholders calling on the government to offer assistance and establish favourable conditions for the sector to flourish. Experts are sounding the alarm about the future of Nigeria’s economy as the telecom industry grapples with a host of issues. The sector’s struggles could have wide-reaching impacts on the country’s economic growth and Innovation.
Nigeria has emerged as a dominant force in Africa’s ICT sector, with a staggering 82% share of the continent’s telecommunications subscribers and a significant 29% share of internet usage. On a global scale, Nigeria holds the 11th position for the highest number of internet users and the 7th position for the highest number of mobile phones in use. For more than a decade, the ICT sector has consistently boosted Nigeria’s gross national product by more than 10% in terms of economic contribution.
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Additionally, Nigeria’s telecommunications market is one of the biggest in Africa, despite often struggling with inconsistent Power Supply. The majority of internet users rely on mobile networks. Efforts are being made by the government to increase the reach of Broadband services. Telecom companies are laying fibre optic cables in different regions and Lagos, as well as setting up new base stations to improve network efficiency and reduce congestion. However, the Disruption caused by a submarine cable break in 2020 resulted in decreased internet speeds and disrupted communication networks.
