Telecoms sector is improving Africa's GDP

For Nigeria and other sub-Saharan African (SSA) countries to wriggle out of their current economic challenges, the need for governments to focus more on telecommunications sector has been stressed.

This is even as it has been adequately established that there is strong correlation between telecommunications sector and the Gross Domestic Products (GDP) growth rate in Africa.

Speaking at the weekend in Lagos, at the 12th Nigerian Telecom Lecture and Awards, the Executive Vice-Chairman of the Nigerian Communications Commission (NCC), Prof. Umar Danbatta, said in a period where Africa is burdened by poverty and debts, telecommunications has become one of the key sources of improving the GDP of the African economies.

Danbatta said currently, telecommunications and ICT contribute up to 10 per cent of Nigeria's GDP.

He disclosed that during his recent visit to the Governor of Kano State, Alhaji Umar Ganduje, while referencing a report from the National Bureau of Statistics (NBS), which put the contributions of the telecommunications sector to the GDP at N1.4 Trillion in the first quarter of 2016, said 

"this is a positive indication that more investments, more deployments and more economic activities around the sector will continue to impact positively in the sector"

"However, it was good reason for various agencies of government, and governments at all levels in Africa, to show greater understanding and support for to the quest by various regulators in Africa to improve the telecommunications environment."

Juxtaposing the effect of broadband on GDP, Danbatta posited that there have been global expectations of the impacts of broadband and efforts by various countries to achieve fast deployment of broadband infrastructure are currently on.

"We all know that Broadband is an enabler of other economic and human activities. The World Bank and the International Telecommunications Union, ITU, have made recommendations about broadband that cannot be ignored by any progressive telecommunications regulator", he said.

According to him, the Broadband Commission, while emphasizing its importance for future economic development of every nation, referred to the World Bank research that indicates that, "for high-income countries, a 10-percentage-point rise in broadband penetration adds a 1.21-percentage point rise in economic growth - or an added 1.38 percentage points for low- and middle-income countries. This is more than any other type of communication service."

Danbatta pointed out that this was one of the reasons why broadband is on the top of the eight-point agenda of the NCC under his leadership.

The NCC EVC posited that he believes many African countries are giving serious thoughts and actions towards the provision of broadband to make it available, accessible and affordable for the citizens of the continent, and in the process, impact positively to their national economies.

According to him, in Nigeria, the target is already set for 30 per cent penetration in 2018, against the current 10 per cent penetration across the country.

He said plans are already in place, which includes the licensing of fibre infrastructure providers in the remaining five geopolitical zones of South West, South East, South South, North West, and NorthEast.

"Two companies are already licensed for North Central and Lagos, which is considered a zone on its own right as the commercial capital of this country with huge demands for telecom services. We have successfully sold some slots of frequencies in the 2.6GHz Spectrum Band, and will continue to commit efforts towards efficient management of resources to achieve the various targets expanding the frontiers of broadband and improving the telecommunications sector", he stated.

Danbatta said Africa is still very promising for investments, stressing that telecommunications investors have huge opportunities to explore the African continent, which still has huge potentials for returns on investment.

According to him, the developed parts of the world are almost saturated with different types of telecommunications services. 

"Therefore, Africa stands a chance to make desirable impact in the next few years if we get our plans right. Therefore, this is another opportunity to advice fellow regulators that we need to keep our eyes on the ball for the benefit of the continent's faster development", he stated.

Original article by Adeyemi Adepetun for The Guardian