Nigeria’s telecoms investments hit $75.6bn, says Danbatta

*Prof. Umar Garba Danbatta, Executive Vice Chairman and CEO of NCC at a media roundtable, in Lagos, announces both Foreign Direct Investment (FDI) and local investments in the telecommunications sector totalled $75.6 billion 2021, and the industry equally added N10.126 trillion to the country’s Gross Domestic Products 2022

Isola Moses | ConsumerConnect

Prof. Umar Garba Danbatta, Executive Vice Chairman and Chief Executive Officer (EVC/CEO) of the Nigerian Communications Commission (NCC), has disclosed that the investment profile in the country’s telecommunications sector, comprising Foreign Direct Investment (FDI) and local investment was $75.6 billion as of 2021.

ConsumerConnect reports Danbatta announced this development at an interactive session with stakeholders in the communications media ecosystem Wednesday, July 5, 2023, in Lagos.

Danbatta’s leadership scorecards and landmark developments in telecoms sector

The EVC/CEO of the telecoms sector regulatory Commission, at the event also provided his leadership scorecards and landmark developments that have shaped growth trajectory in the telecoms sector since he became the chief telecoms regulator August 2015.

He noted that investment profile in the sector, in 2018, stood at $68 billion.

According to the NCC Executive Vice-Chairman, this increased to $70.5 billion 2019 and $72 billion 2020 respectively.

Danbatta also disclosed that at the end of 2021, the figure increased to $75,560,563,417.79 ($75.6 billion).

The Commission further stated: “The latest figure is the current official investment profile computed in the industry up from the initial $70 billion investment in the last few years.

“Investment in the telecommunications sector in Nigeria is computed from two sources: the Central Bank of Nigeria (CBN), and the financial data obtained from service providers by the Commission.

While the CBN collects and calculates an element of the telecoms sector to include FDI, portfolio and others, the Commission collects investment figures from telecom licensees described as domestic investment arising from capital expenditure (CAPEX) which form part of the total investment in the industry, said the EVC/CEO.

He as well said through effective regulatory environment enabled by the Commission, the telecoms sector has recorded tremendous growth from an initial investment profile of $500 million 2001, when the sector was fully liberalised.

Danbatta likewise revealed the Nigerian telecoms sector had continued to be a major contributor to the Nigeria’s economy through an impressive the sectoral contribution to the country’s Gross Domestic Product (GDP) quarterly, up from about 8.5 percent in third quarter of 2015, contributing N10.126 trillion to the nation’s GDP 2022 alone.

Telecoms contribution to Nigerian economy

Citing data from the National Bureau of Statistics (NBS), Danbatta also noted that the telecoms sector contributed N10.126 trillion as an aggregate quarterly contribution to GDP last year.

The NCC Chief said: “In the first quarter, the sector contributed 12.94 percent equivalent to N2.246 trillion while the second quarter witnessed an all-time high GDP contribution by the telecoms sector to the nation’s economy, standing at 15 percent and valued at N2.593 trillion.

“The sector’s contribution to GDP in the third was 12.85 percent and in the fourth quarter, it grew to 13.55 percent, which are valued at N2.436 trillion and N2.851 trillion respectively.”

He further stated: “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.”

Telecoms as major enabler of economic development in Nigeria

The NCC stressed that the telecoms sector contribution to national GDP has grown significantly since assumption of Prof. Danbatta as the EVC of the Commission August 2015, according to available data from NBS.

It is also noted from 8.50 percent 2015, it grew to 9.13 percent 2016 and to 8.66 percent 2017.

The Commission said in the last quarter of 2018, telecoms contributed 9.85 percent to national GDP while it added 10.60 percent in the fourth quarter of 2019.

Also, in the second quarter of 2010, it added 14.30 percent to GDP; 14.42 percent in the second quarter of 2021.

Danbatta declared that “the highest quarterly contribution to GDP by the sector to the economy was 15 percent in the second quarter of 2022.”

The sector, he restated, has become a major enabler of economic development in Nigeria, as it continues to positively impact all the facets 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 liberalisation 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,” said he.

On subscriptions, teledensity and Broadband connectivity

Besides the growth in investment and GDP contribution, Danbatta equally said: “As of May, 2023, active voice subscriptions reached 221.3 million, equivalent of 115.91 per cent teledensity, while Internet subscriptions rose to 159.6 million.

According to the CEO of NCC, Broadband subscriptions on Third Generation (3G) and Fourth Generation (4G) networks increased to 92.2 million, representing a 48.28 percent broadband penetration in the country.

Also, following the issuance of 3.5GHz spectrum licences for the deployment of Fifth Generation (5G) networks in Nigeria, marked by ultra-high speed internet, low latency and high capacity, and the subsequent commercial launch by two of the three licence holders, 5G subscriptions have grown to over 60,000 in many cities in at least 12 states of the Federation.

Danbatta assured of the Commission’s commitment to always give concrete expression to the Federal Government Executive Order 001 focused on Ease of Doing Business (EoDB) and other digital economy-oriented policies, by embarking on various regulatory initiatives that support a friendly investment climate for investors in Nigeria and enhance value for money for telecom consumers.

The EVC/CEO particularly, commended the media as a strategic partner and enabler of growth in the telecom sector “through accurate, adequate and timely reporting of all regulatory activities of the Commission.”[do_widget id=heateor_sss_sharing-2]