Experts Urge Govt Support to Prevent Telecom Sector Collapse

…Warn of broader economic impact

Nigeria’s economic experts and telecom industry stakeholders have raised alarms about the sector’s decline, cautioning that its deterioration could significantly hinder the country’s economic growth and development.

At a breakfast session hosted by Lagos Business School, Pan-Atlantic University, on June 5, 2024, leading private sector voices gathered to discuss “Telecom Sector: The Fulcrum for Economic Dynamism in Nigeria.” Keynote speaker Bismarck Rewane, CEO of Financial Derivatives Company, stressed the telecom sector’s pivotal role in fostering economic growth, innovation, and productivity across various industries.

Rewane highlighted the sector’s challenges, including rising inflation, high operating costs, limited access to foreign exchange, regulatory burdens, multiple taxations, and local government extortion, noting that these issues threaten its growth. He warned that telecom revenues might decline, creating a ripple effect on other sectors.

Rewane’s comments support telecom operators’ call for cost-reflective tariffs amid adverse economic conditions. He emphasized that the telecom sector’s forward and backward linkages to other industries are crucial for economic development and innovation. “If the telecom industry collapses, all other sectors will follow,” he added.

Other speakers, including Prof. Ali Bongo, echoed Rewane’s sentiments, emphasizing the need for government support and deregulation to ensure the sector’s survival. They highlighted its growth potential, noting its 8% outperformance of the GDP growth rate from 2019 to 2023.

The event underscored the telecom sector’s essential role in Nigeria’s economic growth, with stakeholders urging government intervention to create an enabling environment for its continued development. Experts warn that the sector’s decline could have far-reaching consequences for Nigeria’s economic dynamism.