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Operators seek access to FX, as more players risk collapse

By Adeyemi Adepetun
12 October 2022   |   4:14 am
Telecommunications operators have, again, called on the Central Bank of Nigeria (CBN) to prioritise their access to foreign exchange (FX), especially as the illiquidity crisis worsens.

Dr Isa Ali Pantami

• ALTON fears sector may go the way of aviation
• GSM operator justifies tariff hike, claims regulator gives approval 

Telecommunications operators have, again, called on the Central Bank of Nigeria (CBN) to prioritise their access to foreign exchange (FX), especially as the illiquidity crisis worsens.
   

 
The operators, under the aegis of the Association of Licensed Telecommunications Operators of Nigeria (ALTON), said members have been having it very rough accessing FX since the beginning of the year.
   
Chairman of ALTON, Gbenga Adebayo, at a telecoms forum in Lagos, said the situation in the sector is gradually getting to a critical point, a very dangerous one at that, where what befell the aviation industry in the last few months might find a bigger expression in the telephony industry.
   
Adebayo said like the aviation sector, the telecoms industry is also very critical to the Nigerian economy and must be prioritised.
   
According to him, ALTON members rely on forex for importation, because “virtually everything we use in the sector is import dependent. You talk about the base station equipment; generating sets, batteries among others. But the inability to get a foreign exchange is impacting not only expansion but also upgrades of existing infrastructure.
   
“Now that we are deploying 5G, operators need access to forex, if the service must be expanded. Lots of members are finding it difficult, they cannot fulfill this obligation. The sector needs intervention. I pray what happened in the aviation sector would not find expression in the telecoms industry.”
    

Adebayo, who advocated that the sector should be classified as the first sector to be attended to when it comes to access to forex, stressed that there is a bad debt profile on some members.
   
According to him, so many telecom operators have become dormant because of several challenges confronting the sector, especially the inability to access forex, multiple taxations, over regulations among others.
   

[FILES] ALTON Chairman, Gbenga Adebayo

Adebayo said these challenges have become a major headache to the industry, stressing that over 40 different taxes are slammed on the operators.
  
While emphasising the need for urgent actions to be taken, Adebayo noted that the regime of national tariff should be over.
   
On this challenge, the ALTON boss didn’t shy away from disclosing that operators may introduce discriminatory prices.
   
“I don’t see why hostile states should not be treated the same way they are treating operators. Friendly states will be treated the same. Plans are on to introduce discriminatory prices, especially those states, which see telcos as cash cows,” Adebayo stated.   

MEANWHILE, while the NCC has said it is unaware of any approval that directs tariff hike in the industry, following a 10 per cent hike in data cost implemented by MTN and Airtel, a senior telecoms official, who spoke to The Guardian on the occasion of anonymity on Monday, justified the hike. He disclosed that the NCC approved the tariff hike.
   
According to him, it is not possible for any operator to just wake up and jack up prices without recourse to the regulator.
   
“We wrote to NCC, even sent representatives down to the commission to explain reasons for the slight increase in data tariff. They approved,” he stated.
   


The telecoms official explained that in the last eight years, only the telecoms industry has not increased the price, “okay, check other industries, from manufacturing to production, prices have changed. It is not the same amount you bought bread in May that you are buying now. It is not the same price you bought fuel three years ago, that you are buying! If you enter the market, you will understand what I am saying better.
  
“Coupled with the fact that operators don’t have access to foreign exchange, this has compounded the sector’s woes. Everything we do in the sector is dollar-denominated, but there is little or no access to forex. How do you think we manage to maintain almost two generating set each at about 40,000 sites of the operators? We need access to forex and a tariff hike is needed now.”
   
He, however, said the information that just came from Abuja is that the Minister of Communications and Digital Economy, Prof. Isa Pantami has asked NCC to tell the telcos to revert to the old data tariff as fast as possible.
  
“So, it shouldn’t be long before a memo would come from NCC to that effect. But the fact remains that tariff hike would come anytime soon,” he stated.

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