Telecoms: 25% GDP contribution by 2025 possible

STAKEHOLDERS in the telecom sector including the Nigerian Communications Commission (NCC) and operators have acknowledged the extant infrastructure gap. However, the operators’ inability to deploy infrastructure faster has been blamed on many factors, all of which hinder accelerated roll-out.
NCC report indicates that in terms of Base Transceiver Stations (BTS) sites by GSM operators, as at December, last year, MTN, Glo, Airtel and Etisalat had 12,557; 6,677; 6,186 and 4,756 base stations respectively.
According to the report, GSM operators owned a total of 30,176 base stations which is an increase from 28,289 base stations recorded by the four major mobile operators in December, 2013, thereby indicating an increase of 6.6 per cent. On fibre optics deployment in kilometers, the report says as at December 2014, the telecoms operating companies (GSM, CDMA and fixed telephony operators) had deployed a combined total of 80,938km of fibre optics. Further analysis of the fibre optics data showed that, of the 80,938km deployed as at December 2014, 64,433 km was on land while 16,506 km was submarine.
The regulator says that Nigeria requires no fewer than 70,000 base stations in order for the operators to provide better quality of service to their growing telecoms consumers, findings show that the country currently has just a little over 30,000 base stations.
This represents an infrastructure deficit of 40,000 base stations. The deficit represents an investment gap of N1.6 trillion, as sources at major telecoms companies estimated the cost of building a base station to an average of N40 million. Therefore, to build 40,000 base stations at N40 million per each, the deficit emanating from BTS, which is critical to scaling up the provision of service, telecoms companies would need an estimated N1.6 trillion.
Investigation has shown that the extent to which the industry is able to address the infrastructure lacuna would determine how well the country is able to attain increased contribution to Gross Domestic Product (GDP) of 25 per cent by 2025, as currently being championed by stakeholders.
GDP target
The maiden edition of Nigeria Telecom Impact CEO Forum, organised by ICT Watch Network in collaboration with financial technology magazine, in Lagos recently has set another target for the telecoms sector.
With the theme: ‘How Telecoms Can Contribute 25 per cent to the GDP by 2025,’ the stakeholders at the forum examined strategies to tackle obstacles confronting infrastructure deployment, which could obviate the attainment of the GDP target in the next 10 years. At the event, the telecoms regulator assured that Nigeria could achieve the GDP contribution target if current effort by the commission to tackle challenges of infrastructure rollout is supported by all stakeholders. Telecoms sector currently contributes 11 per cent to GDP.
Speaking at the forum, acting Executive Vice Chairman of the Nigerian Communications Commission (NCC), Prof. Umar Danbatta, who was represented by the Commission’s Public Affairs Director, Mr. Tony Ojobo, explained that the Commission continues to implement policies that guarantee a good operating environment for telecoms players.
He said: “We submit that the question as to whether telecom will contribute 25 per cent to the GDP by 2025 should not be a question but a desirable dream. “It is our guess that this is not wishing that other sectors of the economy would stand still for telecom to overtake them, but it may serve as a tonic for the stakeholders and operatives in the industry that their impacts are being felt.”
According to Danbatta, it is also a proposition that would attract more resources that would energise the industry to keep pace with expectations of more activities. He explained that a sector of the economy projecting to contribute 25 per cent to a nation’s GDP invariably presents a blank cheque for rewarding economic activities, innovations, huge returns on investment, provision of huge employment opportunities, promotion of welfare of the citizens, and provision of huge support to governance.
Consequently, the NCC boss said, as a regulator that has been able to supervise the industry that led to the attainment of 10 per cent contribution to GDP, “we shall continue to provide the enabling environment to attain the prediction of 25 per cent by 2025.” TO achieve this auspicious target, he notes that the NCC is currently engaging the Nigeria Governor’s Forum (NGF) with a view to removing the barriers to infrastructure deployment such as fiber optic cables, base transceivers stations (BTS) and others from their states. He said: “Tax friendly policies should be encouraged and Right of Way (RoW) needs to be addressed. “It is our wish that this dream of 25 per cent contribution to the nation’s GDP comes through as a reality.
“Our commitment to this dream is to continue to oversee the industry with innovative and robust regulatory processes, spiced with transparency, fairness and openness, providing choice for the Nigerian consumers and businesses, trusted by investors across the globe, and respected by the international community.”
Chairman, Open Media, Engr. Ernest Ndukwe, encouraged the telecoms regulator to be pro-enterprise in its regulatory activities so as to encourage the development of private sector players that would help achieve the increased GDP contribution through deeper ICT penetration into the sector.
He particularly challenged governments and their agencies to speed up RoW approval for telecoms companies, saying ICT has critical role to play in ensuring effective governance.
He advised other states to emulate Lagos in the area of lowering the cost of RoW approval in the state. Lagos State Governor, Mr. AkinwumiAmbode, while noting that “our quest to be an active player in the global competitive economy will be determined by the extent to which our local economy is driven by ICT,” assured stakeholders of the state’s continuous readiness to implement policies that attract telecoms investors into the state.
In the same vein, General Manager, Regulatory Affairs, MTN, Oyeronke Oyetunde, therefore sought stronger collaboration between governments at all levels and telecoms companies to ensure that the 25 per cent GDP target is brought to fruition.
In his comments, Chairman, Teledom Group, Dr. Emmanuel Ekuwem, said to effectively achieve unbridled telecoms access across the country, efforts need to be made to accelerate the transmission of the over 10 terabyte of fibre optic cables sitting on the Lagos shores across the nooks and crannies of the country.
Meanwhile, Director-General, National Broadcasting Commission (NBC), Mr. EmekaMba, while explaining the important of telecoms to the broadcasting sector, maintained that the Internet is the future of broadcasting sector.
According to stakeholders, as more sectors of the Nigerian economy appreciate the importance of telecommunications in simplifying and improving their productivity and efficiency, there is a need to sustain an open platform such as Nigeria Telecom Impact CEO Forum, where CLevel executives of various sectors would meet the telcos for accessing their needs, discussing the current trends and making realisable projections into the future.