Telecoms investment stock reaches $75.6 billion as the sector contributes N10.126 trillion to GDP

  • Danbatta guarantees increased capital inflow and service expansion

Prof. Umar Garba Danbatta, Executive Vice Chairman (EVC) of the Nigerian Communications Commission (NCC), announced that the overall stock of investments in the country’s telecommunications sector, including FDI and local capital, had reached $75.6 billion.

Danbatta made the announcement during an interactive session with stakeholders in the communications media ecosystem in Lagos yesterday, where he reeled off his scorecards and landmark developments that have shaped the trajectory of growth in the telecoms sector since assuming the role of chief telecoms regulator in August 2015.

Total investment investments as of the end of 2021 are included in this number.

According to Danbatta, the sector’s investment profile was $68 billion in 2018. This is expected to rise to $70.5 billion in 2019 and $72 billion in 2020.

The number was $75,560,563,417.79 ($75.6 billion) by the end of 2021. The most recent figure reflects the industry’s current official investment profile.

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Investment in Nigeria’s telecommunications sector is calculated using two sources: the Central Bank of Nigeria (CBN) and financial data acquired by the Commission from service providers.

While the CBN gathers and assesses FDI, portfolio, and other elements of the telecoms sector, the Commission collects investment numbers from telecom licensees classified as domestic investment originating from capital expenditure (CAPEX), which comprise part of the total investment.

The NCC CEO stated that thanks to the Commission’s strong regulatory framework, the telecom sector has grown tremendously from a $500 million investment profile in 2001, when the sector was fully liberalised.

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

Danbatta stated that the telecoms sector contributed N10.126 trillion as an aggregate quarterly contribution to GDP in 2022, using data from the National Bureau of Statistics (NBS).

“In the first quarter, the sector contributed 12.94%, or N2.246 trillion, while the second quarter saw an all-time high GDP contribution by the telecom sector to the nation’s economy, standing at 15%, or N2.593 trillion.” The sector contributed 12.85 percent of GDP in the third quarter and 13.55 percent in the fourth quarter, valued at N2.436 trillion and N2.851 trillion, respectively.

“The growth trajectory continued this year as the Nigerian telecommunications and information services sector 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 of 2023,” he stated.

According to NBS data, Danbatta’s contribution to national GDP has increased dramatically following his appointment as EVC of NCC in August 2015.

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It increased from 8.50 percent in 2015 to 9.13 percent in 2016 and 8.66 percent in 2017. Telecoms contributed 9.85 percent of national GDP in the fourth quarter of 2018, and 10.60 percent in the fourth quarter of 2019.

It also added 14.30% to GDP in the second quarter of 2010 and 14.42% in the second quarter of 2021. The sector’s biggest quarterly contribution to GDP to the economy was 15% in the second quarter of 2022.

Overall, Danbatta stated that the sector has become a major enabler of economic progress in Nigeria, positively impacting all aspects of the Nigerian economy. “As the regulatory authority for the telecom sector in Nigeria, we are pleased that the sector has recorded phenomenal growth statistics over the last two decades of telecoms liberalization.” We will not, however, rest on our laurels. “We will continue to push forward to greater heights by encouraging the expansion of frontiers in order to place Nigeria on the global map of the digital economy,” he said.

In addition to increased investment and GDP contribution, Danbatta stated that “as of May 2023, active voice subscriptions reached 221.3 million, equivalent to 115.91% teledensity, while Internet subscriptions increased to 159.6 million.”

According to the NCC’s CEO, broadband subscriptions on Third Generation (3G) and Fourth Generation (4G) networks have climbed to 92.2 million, representing 48.28% broadband penetration in the country.

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