NIGERIA INFORMATION AND COMMUNICATION TECHNOLOGY SECTOR: 2017 REPORT & 2018 OUTLOOK
The Information and Communications sector is a key driver of economic growth and is regulated primarily by the Federal Ministry of Communication Technology, which supervises top-level development and policy planning; the Nigerian Communications Commission (NCC), which is the telecoms regulator; the Nigeria Internet Registration Association, which manages the nation’s ‘.NG’ domain; and the Nigeria Information Development Agency (NITDA), which has responsibility for policy standardization, research, and the co-ordination of Information-related development programmes.
Knowing the potentials of this sector, the government prioritizes this sector as a tool for economic transformation in the country. As stated by the Senate President, Bukola Saraki, ICT can be a key source of potential revenue and livelihoods for millions of Nigerian enterprising youth.
Nigeria leads its regional peers in terms of ICT penetration and development. In a recent publication, Lagos, Nigeria, was declared set to overtake Nairobi, Kenya, as Africa’s start-up capital. Nigeria boasts of many eCommerce start-ups like Konga, Jumia, Andela, iRoko, Farmcrowdy, and Flutterwave to mention a few. News like these can be attributed to the establishment of such investments as ‘Yabacon Valley’ and the $360 Million investment in the African ecosystem from which Nigeria got about $109 Million, amongst other factors. This indicates an increase in investor interest within the Nigerian tech space.
Irrespective of its clear potential, the local market is taking some hit. The ICT infrastructure which is essential for the development of high-value services and successful tech companies remains poor in terms of coverage, quality, and price. The economic landscape has led to a reduced expenditure on ICT and an increment in costs. According to the Director General of NITDA, Dr. Isa Pantami, over N720 billion is estimated to be leaving Nigeria’s economy annually through the importation of IT equipment, solutions and services; the National Office for Technology Acquisition and Promotion (NOTAP) had recently released statistics, declaring that 90 per cent of IT products and services being used in the banking industry, for instance, are foreign while local vendors are left un-patronised.
In addition, while many countries, especially developed countries are gearing up for the 5G evolution, many African countries, including Nigeria, are just embracing 4G. Nigeria for instance only recently embraced 4G even at that, many Nigerians still prefer the 3G as few could cope with the demands of 4G.
Over the year, the Abu Dhabi-based Etisalat Group withdrew from Nigeria after terminating its management agreement with its Nigerian arm. This decision of the Abu Dhabi-owned network operator, which once held a 45 per cent stake in Etisalat Nigeria and 25 per cent of its preference shares, arose after its $1.2 billion loan talks with 13 Nigerian banks collapsed. The brand, now known as ‘9mobile’ is currently subject to takeover bidding.
Regardless of all these, Nigeria has produced some of the continent’s most successful ICT firms, some of which stood out at the 2017 GITEX exhibition, and the sector has so far emerged as a significant market contributing over N15 trillion to the country’s Gross Domestic Product (GDP) since the liberalisation of the sector, according to the Nigerian Communications Commission (NCC).
Christian Egwuogu is a Business Analyst at ACIOE Associates where he leads engagements in Information and Communication Technology, while also leading other key projects.
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