Foreign Direct Investment (FDI) and local investment in Nigeria’s telecommunications sector grew to $75.56 billion in 2021, driven by an effective regulatory environment.
This was disclosed by Umar Garba Danbatta, executive vice chairman (EVC) of the Nigerian Communications Commission (NCC).
NCC, at an interactive session with stakeholders in the communications media ecosystem, in Lagos on Wednesday, said the sector has achieved significant growth moving from an initial investment profile of $500 million as of 2001, when the sector was fully liberalised.
“In 2018, it recorded $68 billion. It grew to $70.5 billion in 2019 and $72 billion in 2020. At the end of 2021, the figure rose to $75.56 billion. The sector has continued to be a major contributor to Nigeria’s economy through an impressive sectoral contribution to GDP, quarterly, up from about 8.5 percent in the third quarter of 2015,” he said.
The EVC added that the sector also contributed N10.126 trillion to the country’s Gross Domestic Product (GDP) in full-year 2022 and N2.508 trillion (14.13 percent) in the first quarter of 2023, according to the National Bureau of Statistics (NBS) report.
“In the first quarter of 2022, the sector contributed 12.94 percent equivalent to N2.246 trillion while the second quarter witnessed an all-time high GDP contribution by the telecom sector to the economy, standing at 15 percent and valued at N2.593 trillion. The sector’s contribution to GDP in the third quarter 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.
Speaking on the sector’s full-year contribution to GDP, he said since he assumed office in the third quarter of 2015, it has also grown significantly, moving from 8.50 percent in 2015, to 9.13 percent and 8.66 percent in 2016 and 2017 respectively.
“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; in the second quarter of 2020, it added 14.30 percent to GDP; 14.42 percent in the second quarter of 2021 and the highest quarterly contribution to GDP by the sector to the economy was 15 percent in the second quarter of 2022.,” he said.
In addition to the growth in investment and GDP contribution, Danbatta said, as of May 2023, active voice subscriptions reached 221.3 million, equivalent to 115.91 percent teledensity, while internet subscriptions rose to 159.6 million.
“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,” he said
Danbatta added that 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.
“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’re not resting on our oars; we will continue to push upward to greater heights by encouraging the expansion of frontiers to put Nigeria’s imprint on the global map of digital economy,” he said.