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Telecoms contribution to GDP hits 8.8 per cent

By Adeyemi Adepetun, Ibukun Igbasan (Lagos) and Chuka Odittah, Abuja
03 June 2016   |   3:45 am
The National Bureau of Statistics (NBS) said yesterday that the telecommunications sector contributed 1,411.74 billion or 8.83 per cent to the country’s Gross Domestic Product (GDP) in the first quarter of 2016.
Umar Danbatta, NCC Boss.

Umar Danbatta, NCC Boss.

The National Bureau of Statistics (NBS) said yesterday that the telecommunications sector contributed 1,411.74 billion or 8.83 per cent to the country’s Gross Domestic Product (GDP) in the first quarter of 2016.

Making this public yesterday in Abuja, the bureau added that the sector’s contribution inched upwards by .0.5 per cent relative to the same quarter in 2015.

As opposed to the nation’s economy which recorded a negative growth rate of -0.36 per cent in the first quarter, growth in the telecommunications sector increased to 5.00 per cent in the first quarter, from 3.49 per cent in the final quarter of 2015.

The share of telecommunications in total real GDP had declined throughout 2010 to 2014, but for the last five quarters growth in telecommunications has soared higher.

At the level of subscriber base, total number of subscribers also witnessed rapid increase over the past decade.At the end of 2005 there were 19,519,154 subscribers, but by the end of 2015 there were 151,017,244, which is equivalent to an increase of 13,149,809 every year. However, growth has been declining more recently, possibly as a result of high market penetration leaving less room for large expansion.

Also, adjudged to be worth over $32 billion since its liberalization in 2001, the country’s telecommunications sector according to the Nigerian Communications Commission (NCC), has one of the largest and fastest growing market in Africa.

The NCC gave this figure in Lagos, yesterday, at the 2016 Nigeria DigitalSense Forum Series, organized by DigitalSense Africa (DSA) Media.
Speaking as a Guest of Honour at the forum, NCC Executive Vice Chairman, Prof. Umar Danbatta, while making reference to a National Bureau of Statistics report, said the telecommunications industry is the fifth most resilient sector in Nigeria.

Danbatta, who was represented at the forum by NCC Deputy Director, Spectrum Administration, Toyin Asaju, disclosed in a presentation that the country is committed to achieving the 30 per cent broadband penetration target of 2018, as enshrined in the National Broadband Plan.

According to him, broadband is the future, stressing that almost three billion people, about 40 per cent of the world’s population are using the Internet.

Danbatta observed that all regions continue to show double-digit growth rates but Africa stands out with a growth rate of over 40 per cent twice as high as the global average.

said by end of 2015, mobile broadband subscription in Nigeria tripled from 2012 (97, 034, 843) subscribers compared to 30, 939,112 subscribers as at 2012.

While calling for more investors into Nigeria’s burgeoning telecommunications sector, especially in the areas of infrastructure build out; gateway services; manufacturing and assembling of telecommunication equipment, broadband and multimedia, bandwidth provision clearing houses; gateway services, Danbatta disclosed that as the country matched towards realizing 2018 broadband target of 30 per cent, he listed some of the steps already taken towards this.

According to him, the steps included licensing of infrastructure companies; auction of 2.6GHz spectrum; fibre connectivity of Internet exchange points and determination of wholesale pricing for lease capacity.

Speaking on challenges bedevilling the sector, the NCC EVC said poor quality of service caused primarily by network capacity constraints; the lack of physical and transmission infrastructure; scarce spectrum resources; unreliable power supply, disparity in telecommunications facilities between urban and rural areas; shortage of long term investment capital; skill shortages; security challenges; theft; transmission cable cuts, among others.

Going forward, Danbatta said the commission’s strategies have proved successful in stimulating private sector investment and involvement, stressing that NCC welcomes the views of the private sector on how to improve broadband services and more ways to attract additional private sector investment.

According to him, the commission continues to promote transparent regulation as an affirmation of the Nigerian telecommunications sector as a safe haven for investors.