Coming after three years of continuous fall of Foreign Direct Investment (FDI) into Nigeria’s telecommunications industry, the capital importation has bounced back.
The Executive Vice Chairman of the Nigerian Communications Commission (NCC), Prof. Umar Danbatta has said that the telecoms sector has pulled in Foreign Direct Investment of $930 million.
He disclosed recently during an interactive session with media chiefs hosted by the commission in Abuja.
Foreign direct investment (FDI) is an investment made by a company or individual in one country in business interests in another country, in the form of either establishing business operations or acquiring business assets in the other country, such as ownership or controlling interest in a foreign company.
On capital importation, the EVC said in 2015, Foreign Direct Investment (FDI) in the telecom sector stood at $1 billion but declined to $212 million by 2018.
He, however, noted that through regulatory efforts, the FDI in the sector has picked up again reaching $930 million according to recent figures from the Central Bank of Nigeria (CBN).
Speaking on the need for more FDI, Danbatta stated that the capital intensity of the industry, the need for service providers to increase their infrastructure deployment to satisfy the ever-increasing demand, creates room for double the size of this investment in coming years.
“The quest for data and social media as well as the increasing value added services create new frontiers for investments. Therefore, the desire for investment in the sector will continue to grow as the size of the network increases”.
Meanwhile for more investments to be generated within the industry, issues around spectrum management and utilisation were brought to the fore. For Danbatta, Spectrum management in Nigeria is taken very seriously by the Commission because of its wider implication as a national resource as well as an enabler of services, especially in a country where mobile communications is predominant.
Furthermore, to optimize the usage and benefit of spectrum, Danbatta stated a number of initiatives such as spectrum trading, infrastructure sharing, satellite infrastructure and wireless infrastructure have been put in place to drive socio-economic development.
In his words,“For instance, the transfer of the spectrum licence of 2X 10MHz in the 900MHz E-GSM Spectrum band from Intercellular Nigeria to Airtel networks Limited amounted to the sum of N8.9 billion. The amount generated through that singular initiative has brought significant revenue to Government.
“The Commission has also remitted N362.34 billion from 2015 to date to the Federal Government Consolidated Revenue Fund (CRF) through spectrum fees and operating surplus, which has helped to boost the revenue-generation drive of the current administration.
“It is interesting to mention that all the initiatives above have helped the Commission in identifying potential frequency bands to be harmonized for 5G deployment, which include 26 GHz, 38GHz and 42GHz.”