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NCC moves for higher telecoms’ contribution to GDP

By BusinessNews Staff on April 23, 2014

The Nigerian Communications Commission is obviously excited by the latest report of a rebased Gross Domestic Product.

The recently published rebased GDP figures have put the nation’s telecoms sector as a significant contributor to the country’s economy.

Indication has emerged that the NCC is targeting a higher contribution of the industry to the country’s GDP.

Part of the initiatives and programmes already in place in the telecoms and communications services industry that will make the sector to improve upon its performing status in years to come, according to the commission, is making availability the 3.5 GHz spectrum band in 27 states and the Federal Capital Territory for sale to the public.

The NCC said, “The spectrum is available in 27 states and Abuja, the capital territory, with all the states having 25 MHz bandwidth, except for Abuja that has only 20 MHz bandwidth.

“The spectrum is expected to be licensed on a state by state basis in the states where it is available, which means that winners of the spectrum licence will operate within the state or states where the licence is situated.”

In the meantime, our correspondent learnt the commission had asked interested candidates to submit application of interest, to enable it to come up with a timetable for the auction.

It was also gathered that the 700MHz spectrum band licence was planned for auctioning next year.

The Nigeria’s rebased GDP figures for 2013 released by the Statistician-General of the Federation, Dr. Yemi Kale, had indicated an 89 per cent jump in the estimated size of the economy.

According to the new rebased data, the size of the Nigerian economy is now estimated at N80.22tn ($510bn) for 2013.

The rebased GDP data showed the telecommunications and information services sector was currently contributing 8.68 per cent to the Nigerian economy, equivalent to N6.97tn ($44.3bn) of the total GDP estimate of N80.22tn.

This compares with N364.4bn ($2.3bn) in the 2012 non-rebased GDP time series indicates that the sector is a fast growing contributor to the nation’s GDP figures.

The new GDP data now include previously unaccounted-for industries such as telecoms and information technology, music, online sales, airlines and film production.

The telecoms sector has thus been identified as a major contributor to the economy in terms of investment inflow as well as its positive impact on other sectors of the economy such as agriculture, commerce and industry, oil and gas and education.

Stakeholders believe that the present programmes of the telecoms industry regulator (NCC), in collaboration with the Ministry of Communication Technology, will not only sustain the growth of the industry and its rising contribution to the GDP, but also drive new growth areas.

Part of the programmes is the new licences being issued by the regulator to open the sector to more players, and further intensify a healthy competition in the industry.

The NCC had on February 19 this year, auctioned the 30MHz slot of the 2.3GHz spectrum to Bitflux, a consortium of three companies.

In addition, licences are to be issued to seven new infrastructure companies before the end of 2014 in a move to deepen broadband infrastructure rollout across the country.

Experts say the issuance of the spectrum bands will go a long way in helping Nigeria to transmit the huge international bandwidth brought by undersea cables across the country to make more communications services available to the people. International bandwidth in Nigeria has increased by about 26 times to more than 9,000 gigabits per second over the past four years.

This is being driven by the rising demand for data services in the country, cutting across individuals, businesses and governments.

The latest industry data by the NCC had indicated that there were 129 million active telephone subscriptions in the country as of February, 2014.

Of this figure, 63.4 million are active mobile Internet subscriptions on Global System for Mobile Communications networks, indicating that there is increasing demand for data-enabled services.

The improving connectivity and increase in businesses done online are also spurring the need for data centres. The country’s online purchases figure in just three years is expected to rise to more than $1bn this year.

The number of payments in Nigeria made by mobile phone’s more than doubled to 2.4 million in the first half of 2012 from the same period a year earlier, while Internet payments rose 9.3 per cent, according to data from the Central Bank of Nigeria.

The NCC said the new policies such as the National Broadband Plan and others were also going to play a key role in making Nigeria’s telecoms sector an attractive investment destination.

As of the middle of 2012, the telecoms sector had recorded a $25bn local and foreign direct investment, up from the $500,000 recorded in 2001 with a plan to double the $25bn in the next years.

Broadband is prided as being the potential investment booster for the industry, and to drive this investment, the NCC and the Ministry of Communication Technology has also continued to leverage every local/international forum to attract investors into the country.

[Punch]

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