Saturday, 19 January the minister of Information and Communication Technology (ICT), Adebayo Shittu received the High Commissioner of India to Nigeria, Shri Abhay Thakur who has pledged a $100 million credit line to help develop Nigeria’s broadband to boost connectivity in Nigeria’s rural areas.
As laudable as the gesture appears, one must ask whether it is truly a loan or an investment. If it is a loan, at what interest rate is it being given to Nigeria? However, a statement attributed to the High Commissioner does suggest it is likely not a direct loan.
“We have experience in the area of broadband network and reaching the masses of India,” says Abhay, “We have a whole range of IT programmes and projects particularly in the last five years and we think we can meaningfully assist Nigeria on the development of ICT and in the field of rural broadband network.”
Abhay’s statement could suggest that whatever uses the money will be put to will be controlled by his country’s men. That is more in character with India’s financial gifts anywhere in Africa.
The problem however is the timing of the loan.
Depending on the outcome of the presidential election and whether the incumbent will want to retain his services after what has been described as a lack-lustre performance, Adebayo is likely to leave his ministerial position. What would the ICT industry remember him for? The man whose tenure saw the near collapse of MTN? Or under whose watch 9Mobile sale has become a long dream?
These days, when he is not dealing with controversies regarding his NYSC certificate, Shittu devotes a chunk of his time on his political ambitions more so with the election just weeks away. The little time he has left are used for the ministry he supersedes.
Nigeria’s weak broadband growth is not so much for lack of funding. Local investors some of whom are backed by foreign funding have continued to invest despite little incentives from the government. In that sense, Nigeria does not necessarily need a $100 million loan.
According to the Nigerian Communications Commission (NCC) overall broadband penetration in Nigeria hit 30.9 per cent as at November 2018, surpassing the 30 per cent target by the National Broadband Plan created in 2014.
The growth was driven by the activities of seven infrastructure companies with licenses to deploy the needed infrastructure to facilitate the required penetration in the 774 local government areas in Nigeria.
While 30.9 per cent is a significant achievement it is nowhere near what a country like Nigeria requires to fully cover its entire population. Importantly, broadband is still very expensive. A report released by Cable.co.uk in November 2018 showed that sub-Saharan countries including Nigeria have the most expensive broadband prices in the world. Average price in each of these countries hit more than $500 compared to the global average price of between $72.92 and $73.04.
Another report by the Alliance for Affordable Internet (A4A1) noted that the price of one gigabyte of data is as high as $35 in Africa compared to other continents.
Local broadband service providers face various challenges that cannot be wished away with a $100 million loan. Again it is not for want of investment. Five submarine cables, Mainone, Glo 1, West African Cable System (WACS) and ntel’s SAT-3 land on Nigeria’s shores and have the capacity of generating 40 terabytes of broadband for the country. Sadly, less than 10 per cent of that capacity is utilised as the rest lie fallow for reasons ranging from man-made damaging activities like fishing, shipping, to high cost of ‘Right of Way’.
Interestingly, the National Economic Council (NEC) RoW guideline stipulates N145 per metre for laying fibre network in every part of the country. However, states arbitrarily fix their own charges which range between N1, 500 and N6, 000.
Rather than a loan, Shittu’s parting gift for the industry that is yet to feel his performance should be in bringing together the states, federal and service providers on a table and insist they harmonize the Right of Way charges. He can also be remembered as the minister who enabled Nigerians maximise the capacity of the already submarine cables in Nigeria. All it may require is to pay a little more attention to the local operators.
