Telecoms contribution to GDP hits record-high 16% in Q2 2023

The telecommunications sector’s contribution to the nation’s Gross Domestic Product (GDP)  increased significantly to 16 per cent in the second quarter of 2023, setting a new all-time high record.

This was disclosed by the Nigerian Communications Commission (NCC)  based on the computation by the Nigeria Bureau of Statistics (NBS).

According to Umar Danbatta, the executive vice chairman of NCC, the sector’s contribution rose by almost 2 per cent from 14.13 per cent recorded in the first quarter of 2023, and up from the hitherto 15 per cent all-time-high record contributed in the second quarter of 2022,

Danbatta, in a keynote address delivered at the annual Telecom Executives and Regulators Forum (TERF) hosted by the Association of Telecom Companies of Nigeria (ATCON) in Lagos, noted that the telecoms sector has continued to positively impact all aspects of the economy,with quarterly GDP increasing significantly to reach its current threshold of 16 per cent.

Speaking on the theme: “Success Factors and Barriers to National Broadband and Digital Economy Aspirations”, the NCC executive vice chairman, said the industry has grown in leaps and bounds over the past two decades and this has impacted on all other sectors of the economy.

The success, he added, has been enhanced through sustained regulatory excellence and operational efficiency by the NCC.

“The effective regulatory regime emplaced by the NCC and with the support from all stakeholders has been our major success factor as an industry,”he said.

Danbatta admitted that there are barriers to broadband deployment in the country, ranging from the issue of right of way (RoW), fibre cuts, high capital requirement for deployment, multiple taxations and regulations, among other challenges.

He, however, assured that the NCC is navigating regulatory complexities, digital divide and literacy, security concerns with firmness and increased collaborations with necessary stakeholders such as ATCON to create measures towards tackling the challenges.

On the RoW challenge, Danbatta said there are about 46 different taxes directed at the telecom sector at the moment. He noted that such charges and levels, coming in various names, are imposed on telecom operators by some agencies and tiers of government, especially at the state and local levels. Danbatta observed that the challenge translates into greater economic burdens on telecom subscribers in the country.

Speaking about connectivity, Danbatta said that the NCC has over the years,  identified some clusters of access gaps all over the country but  there has been a significant drop in the number of access gaps, as the commission continues to drive initiatives that boost access to telecommunications services.

He explained that the NCC does this by enlisting government commitment to a digital economy with robust policy frameworks, promotion of investment and funding, stimulation of infrastructure development, digital inclusion and literacy, promotion of competition and market liberalization, effective allocation of spectrum, as well as driving the e-government ecosystem.

Danbatta also expressed confidence that Nigeria would reach 50 per cent broadband penetration threshold by the end of 2023  would have met and possibly surpassed the 70 per cent broadband penetration target, as contained in the Nigerian National Broadband Plan (NNBP), backed by the  various ongoing regulatory efforts implemented by the NCC.