How ICT Can help In Consolidating Economic Diversification – Danbatta
I am delighted to be invited here to deliver a keynote presentation on this occasion of the fifth edition of WorldStage Economic Summit being held virtually today as occasioned by the COVID-19 pandemic and the attendant need to continue to maintain social distancing and other safety regulations in all we do.
I personally consider the theme of today’s discourse: “New Reality: Consolidating Economic Diversification,” a very important topic as it has to do with the security of our economy and future well-being of our nation and citizenry in the global comity of nations.
However, it is very important to state from the beginning that, our drive to diversify our economy as a nation, away from perennial reliance on oil and gas proceeds, is going to be essentially enhanced by Information and Communication technology (ICT). This is because the ICT has been the enabler of economic growth, providing the necessary digital impetus for transformative development in all other sectors of the economy, be it agriculture, education, financial services, healthcare services and so on.
On this note, permit me to tweak the theme of this event to read: “The Role of ICT in Consolidating Economic Diversification”. With this, I will be able to demonstrate how the ICT/telecoms industry that we regulate has fared in creating the necessary digital platforms to drive President Muhammadu Buhari’s Agenda on Economic Diversification, as well as the Economic Recovery and Growth Plan (ERGP), as part of the Federal Government’s policy direction to keep our economy afloat and navigate through the economic headwinds with respect to the dwindling price of crude oil in the international market.
As we all know, crude oil has been the mainstay of the Nigerian economy and a means of foreign exchange earnings since oil was discovered in commercial quantity in Oloibiri in Bayelsa State in 1956 (Niger-Delta), in what is now referred to as the South-South zone of Nigeria.
However, the search for alternative/ renewable sources of energy and dwindling oil prices have made it paramount for the Oil Exporting Countries (OPEC) to begin to think beyond oil and to look inwards and outwards for economic diversification in order to avoid the monolithic overdependence on oil, which, as recent developments have revealed, is no longer sustainable due to unpredictable market demands for oil.
It is on that premise that President Muhammadu Buhari has said that his leadership will work more closely with other countries facing the challenge of falling oil prices to rapidly move away from dependence on crude oil exports for economic survival. The President also affirmed his administration’s commitment to fast-track development of Nigeria’s non-oil sectors and the speedy diversification of the country’s economy.
Interestingly, some of the key sectors identified by this administration with the propensity and capacity to drive economic diversification are agriculture, ICT/Telecommunications, power and transport. It is in this breadth that the Nigerian Communications Commission (NCC) has reinvigorated its regulatory efforts towards ensuring more ICT infrastructure are deployed, protected and made accessible as well as available to more Nigerians across the nooks and crannies of the country.
Through deliberate provision of the necessary digital impetus for the actualisation of the economic diversification drive of this Government, the NCC is well prepared to make telecoms an enabler for the realisation of ERGP 2017-2020 of the Federal Government.
With clear-headed and focused regulatory interventions, the NCC has been able to deepen access to telecommunications services- voice and data – across the country which have positively impacted other sectors of the economy such as healthcare, education, agriculture, finance, transportation, commerce, governance, and so on.
Also, realising the importance of broadband to the socio-economic development of a nation towards diversifying the economy, NCC came up with an Infrastructure Companies (InfraCos) initiative, which I believe majority of you are aware of. This initiative, which we call Open Access Model (OAM) is aimed at deploying broadband infrastructure by laying fibre optics across the nation. This has necessitated the licensing of seven (7) infrastructure companies (InfraCos) by the Commission to provide robust broadband infrastructure across the nation so that our sector can be able to support the Federal Government’s economic diversification drive.
Recently, the Federal Government, through the Ministry of Communications and Digital Economy unveiled the new Nigerian National Broadband Plan (2020-2025) with the objective to deliver data download speeds across Nigeria at a minimum speed of 25Mbps in urban areas, and 10Mbps in rural areas, with effective coverage available to at least 90 per cent of the population by end of 2025.
This ambitious goal is anchored on a 2016 World Bank Report, which states that “a 10 percentage point increase in fixed broadband penetration would increase Gross Domestic Product (GDP) growth by 1.21 percent in developed economies and 1.38 percent in developing ones.” I am happy to inform you that the NCC has been at the forefront of driving the attainment of these broadband development targets.
To this end, the Commission has been making regulatory efforts to leverage on next-generation technology platforms in order to continuously advance our ICT ecosystem. An important development in this regard was our trial of 5G technology, making NCC the first telecoms regulator to do such in the whole of the West African sub-region. The Proof of Concept (PoC) trials were carried out on MTN network in Abuja and Uyo in Akwa Ibom state under the strict supervision of the NCC in 2019.
Ladies and gentlemen, the whole idea behind the trial is to identify what the challenges are with regard to 5G deployment in Nigeria. We are looking at security challenges, level of radiation power density – whether this is within the acceptable limits provided by the International Commission on Non-Ionizing Radiation Protection (ICNIRP) as well as to address whatever challenges that may arise preparatory to commercial rollout of this technology in the country.
With 5G, we are looking at enhanced mobile broadband applications, the ultra-reliable low latency applications and the Machine to Machine (M2M) applications, all of which will require reliable broadband infrastructure, which is a major focus of the Ministry of Communications and Digital Economy as well as the NCC.
It should be noted that without pervasive infrastructure, the dream of rollout of 5G services will remain just a dream. As such, we have put in place an excellent Spectrum Trading Framework, to allow efficient utilisation of licensed and existing spectrum through leasing or transfer to other operators from a licensee whose objective supports keeping the spectrum idle. Recently, the Commission lifted the suspension on the Spectrum Trading Guidelines (2018), which had been temporarily suspended, pending when a more robust review has been carried out. This is in response to global telecommunications dynamics to deepen access to digital services in the country.
At this point, I wish to commend the Honourable Minister of Communications and Digital Economy, Dr. Isa Ali Ibrahim (Pantami) for his leadership and intervention in ensuring the development of the National Digital Policy and Strategy (NDEPS), which underscores the importance of infrastructure deployment for a digital economy in Nigeria.
The NCC, with the active support of the Minister, has also secured the understanding of the Nigerian Governors’ Forum (NGF) to comply with the N145 per linear metre of fibre cable laid as Right of Way (RoW) charges, as against the hitherto prohibitive charges imposed on the telecoms companies, which have continued to hinder faster infrastructure rollout. Some of the states have waived payment of RoW by the telcos in order to facilitate rollout of more robust broadband infrastructure that can support their socio-economic activities.
This central role of ICT/telecoms sector in bolstering the economic diversification agenda of the Federal Government informed the President’s declaration, recently, of Telecom Infrastructure as a Critical National Infrastructure, which must be protected by all the law enforcement agencies in order to continuously provide the digital support the economy needs. This is commendable, considering that telecom infrastructure has become basic infrastructure like roads, railways etc., especially at this critical time when the outbreak of COVID-19 pandemic has led to the migration of most services across different sectors online. Indeed, the Presidential declaration is a clear pointer that ICT/telecommunications is an important sector that holds the key to the economic diversification and growth of Nigeria.
Today, the economic transformative role of ICT/telecoms is not in doubt, going by the recent data from the National Bureau of Statistics (NBS), which shows that the sector has contributed an impressive 14.07 percent to the country’s Gross Domestic Product (GDP) as at the second quarter of 2020, surpassing crude oil’s contribution.
More importantly, the NCC’s efforts in stimulating and promoting the deployment of more telecom infrastructure is responsible for the network expansion we are witnessing today in the industry. But this could be better. Indeed, this has culminated in the number of people with access to telephony services with active mobile voice subscribers standing at 203.5 million as of August, 2020. This represents a teledensity of 106.62 per cent while active Internet subscribers have reached 150 million as of August, 2020. In the same manner, broadband penetration currently stands at 43.30 per cent, indicating that over 82 million Nigerians enjoy high speed broadband services.
Having said this, ladies and gentlemen, I wish to assure you that the Commission is committed to sustaining the current tide and momentum where ICT/telecoms industry continues to be a major driver of the Federal Government’s vision for economic diversification. While the new reality globally is the need for economies around the world to consolidate on economic diversification, it is our conviction that ICT has a major role to play in making this happen. As such, the NCC, working with relevant stakeholders, will continue to provide the required ‘digital oxygen’ which the economy requires to breathe a new lease of life into its drive for economic transformation.
On this note, I thank you for listening and wish you fruitful deliberation.
Prof. Umar Garba Danbatta, FNSE, FRAES, FAEng, FNIEEE
Executive Vice Chairman/CEO
Nigerian Communications Commission
November 10, 2020