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By Chinenye Anuforo
A new report by the GSMA, a global mobile industry association, has urged Nigeria to improve policies to attract investment in its telecom sector. This investment is crucial to expand internet access and grow the digital economy.
Currently, only 29% of Nigerians use mobile internet regularly. The GSMA predicted that with better policies, 15 million more Nigerians could be online by 2028.
However, the sector faces challenges to infrastructure deployment, including the complex and costly process of securing Rights of Way (RoW), significantly increasing the time and costs associated with rolling out infrastructure.
The complex tax environment in Nigeria is another difficulty for the sector, which they say results in high and increasing costs of tax compliance because of the complex and overlapping tax structure within the country.
Other costs are also rising, making it difficult for the industry to maintain sustainable levels of investment. The primary driver of this has been increases in the cost of power for sites due to the rapid increases in the price of fuel, increased government fees and levies, and increased demand for forex, in an import-dependent environment, due to contractual obligations for network infrastructure and services that are denominated in USD.
The report recommends initiatives to support policymakers in creating an economic and regulatory environment that supports growth, investment, and competition. These include implementing a legal framework for critical national infrastructure to address challenges in building network infrastructure, simplifying and improving the process for issuing RoW and standardising it across the country, reducing the industry’s tax burden to help cut operating costs and creating a regulatory environment that supports sustainable investment.
