THE TELECOMMUNICATIONS SECTOR IN NIGERIA AS DRIVING FORCE FOR ECONOMIC GROWTH
By Na’ankwat Dariem
In Nigeria, the telecommunication business started in 1886.
The then British colonial government had the need to connect with other colonial administrations in Ghana, Sierra Leone, Gambia and it base in England. By 1893, colonial offices in Lagos, Jebba and Ilorin all in Nigeria were provided with telephone services.
By 1952, the development of fixed phone services continued, with inner telephone lines between Ibadan and Lagos which were also extended to other Nigerian cities, but, that was the connection between the country’s States and its London colonial centre.
This led to the installation of phone lines, connecting the famed commercial hub to Jebba, Ilorin, Calabar, Ibadan and other parts of Nigeria. The country established the Nigerian External Telecommunications Limited and kept developing different telecommunication companies.
By 1985, Nigeria Telecommunications Limited, NITEL, was established. It was wholly owned by the government and given monopoly status in the communication sector.
The deregulation of the sector heralded the establishment of the Nigerian Communications Commission (NCC) as stipulated by Decree 75 of 1992. The decree establishing the NCC helped to liberalize terminal ends equipment, and gave room for competition and private sector participation.
This altered the communication structure of Nigeria leading to the privatization of the State monopoly, NITEL, and the licensing of private operators, and ultimately, the emergence of a new telecommunications era.
It is worth noting that Nigeria surpassed the 30 per cent broadband penetration as at December 2018, in the first Nigeria National Broadband Plan (NNBP), which spanned from 2013 to 2018. By 2020, Nigeria came up with a second National Broadband Plan from 2010-2025, with a target of 70 per cent broadband penetration.
Certainly, broadband has become the most critical development of infrastructure in a modern economy. The telecoms sector also acts as the fulcrum and catalyst that propel the socio-economic transformation and growth of economies of nations.
Nigeria has maintained its track in this race and ensured that it is not left behind by other countries in ICT development. For instance, In the past ten years, ICT has continued a steady growth trajectory and has become a major boost to the country’s GDP, overtaking the mainstay of the economy, oil, at some point and has remained the top earner till date.
No wonder the Nigerian Government keying into the benefits of ICT, created a Ministry in charge of Communication and Digital Economy to fast tract development and benefits in the sector.
According to statistics obtained from NCC’s, telecoms contribution to GDP in 2012 was 7.7 per cent, but the figure doubled to 14.3 percent as in the second quarter of 2020. This represented a 2.3 trillion-naira growth, whereas the total contribution of Information and Communications Technology (ICT) to GDP was 17.5 percent.
The current National Bureau of Statistics, NBC, report, shows ICT sector contributing 17.92 percent to the GDP. This figure is 20.54 percent higher than its contribution in 2020 and in the preceding quarter, which accounted for 14.91 percent. This is unprecedented and, in fact, the highest contribution of ICT to the nation’s GDP.
In 2021, there are an estimated 101.72 million mobile internet users in Nigeria. This figure is projected to grow to 142.73 million by the end of 2026.
This GDP report has shown how critical the ICT sector is to the growth of the country’s digital economy and, by extension, the general economy. Indeed, the telecoms sector has helped the Nigerian economy in many ways, including enhanced social interaction, increased GPD, increased productivity, reduction of rural /urban access gaps, emergence of new services and industries, direct job creation, and blurring boundaries of social identities.
Nigeria is going in the right direction with polices such as the National Broadband Plan, NNBP 2020-2025, and the National Digital Economic Policy and Strategy 2020-2030, of the Nigerian government.
To ensure a sustainable growth of the telecommunications industry, the industry needs reform on how to regulate and promote not just the quality and reliability of internet services, but also check the ill-practices of operators.
There is also the need for government to provide an operating environment in the sector to create more values which will result in the increase of contribution to the GDP and creation of jobs.
With all hands on deck, the telecommunications sector will continue to be the driving force for Nigeria’s economic growth.