Nigeria’s telecommunications sector is witnessing a resurgence of investment, attracting $191.5 million in Foreign Direct Investments (FDIs) in the first quarter of this year. This promising start was disclosed by the National Bureau of Statistics (NBS) in its latest capital importation data released on Monday.
This influx of capital marks a significant turnaround for the telecom sector, which had been experiencing a consistent decline in investments over recent years. The fresh injection of funds is seen as a crucial boost to Nigeria’s ambitious goal of connecting at least 70% of its population to broadband by 2025.
The ongoing implementation of the Nigeria National Broadband Plan (NBP 2020-2025) relies heavily on foreign investments to bridge the connectivity gap. Despite this, the sector has faced numerous challenges, including a declining trend in foreign investments. Industry experts estimate that the Nigerian telecom industry requires at least $3.4 billion in investments in fibre infrastructure to achieve the 70% broadband target.
Compounding the sector’s difficulties is the devaluation of the Naira, which has significantly hampered operators’ capacity to invest in necessary infrastructure for network expansion. This economic strain underscores the importance of sustained foreign investment to meet the country’s connectivity goals.
In a bid to bolster investment in telecom infrastructure, the Federal Government recently launched a Special Purpose Vehicle (SPV) to deliver an additional 90,000 km of fibre optic cable. This initiative aims to complement existing connectivity efforts and ensure universal internet access across Nigeria.
Dr. Bosun Tijani, Minister of Communications, Innovation, and Digital Economy, highlighted the strategic collaboration with partners and stakeholders from both the government and private sector. The SPV is tasked with expanding Nigeria’s connectivity backbone to a minimum of 125,000 km, up from the current 35,000 km.
“Building on our existing work with the Broadband Alliance, this increased connectivity will help plug the current non-consumption gap by connecting over 200,000 educational, healthcare, and social institutions across Nigeria, ensuring that a larger section of our society can be included in the benefits of internet connectivity,” said Dr. Tijani.
He further emphasized that the project aims to increase internet penetration in Nigeria to over 70% and reduce the cost of internet access by more than 60%. Additionally, the initiative is expected to include at least 50% of the 33 million Nigerians currently excluded from internet access, potentially delivering up to 1.5% GDP growth per capita. This could raise Nigeria’s GDP from $472.6 billion in 2022 to $502 billion over the next four years.
