Telecoms sector’s investments hit $38 billion
NCC targets stricter compliance regime
Investments in Nigeria’s telecommunications sector have hit $38 billion from $32 billion five years ago.
This new investment profile was disclosed on Tuesday in Lagos, by the Executive Vice-Chairman of the Nigerian Communications Commission (NCC), Prof. Umar Danbatta, while giving the opening remarks at the Corporate Goverance Forum, organized by the commission.
Danbatta said the liberalization of the telecommunications industry opened investment opportunities for both local and foreign companies, contributing significantly to the country’s Gross Domestic Product (GDP).
Illustrating, he said in contrast to the economy as a whole which regressed to -0.36 per cent in the first quarter of 2016, the telecommunications sector contributed, in progressive and real terms, about 8.83 per cent to the GDP in the same period, which represents an increase of 0.5 per cent, relative to the growth in the last quarter of 2015.
“Similarly, apart from attracting Foreign Direct Investments (FDIs) in excess of $38 billion and reflating the economy, the telecoms value chain (formal and informal) continues to create a significant number of job opportunities for our teeming youths. Other positive spin-offs include increasing local content and rising income per capita/per head for employees in the sector”, Danbatta stated.
Speaking on the forum, the NCC boss said as the sector regulator, the commission is not resting on its oars and basking in the glory of its widely-documented successes, “but we are committed to sustaining and building on the formidable structures established over the years for the industry to thrive and outlive us. We desire an industry that will grow bigger, better and be more relevant to successive generations. This is the real essence of our meeting today; to share our thoughts and perspectives on how to meet our commitment to the principles of inter-generational equity in the sector; how we can leave a lasting legacy of a strong and virile industry, fit for bequest to successive generations.”
According to him, in recognition of the need to sustain the phenomenal success recorded in the industry and replicate the lessons learnt in other sectors that had gone through the “Boom and Bust” cycle, the commission in 2012 set up a multi-stakeholder Corporate Governance Working Group (CGWG) with membership drawn from across the Nigerian telecoms industry, the commission and Corporate Governance practitioners.
He disclosed that the mandate of the Group was to determine the industry’s corporate governance needs and the best approach to be adopted in addressing them.
According to him, the CGWG developed the Code of Corporate Governance for the telecommunications industry, which was published in 2014.
“The code consists of 12 principles and was developed to protect the interest of investors and stakeholders in the industry, as well as promote time-valued principles of accountability, responsibility, transparency, integrity and ethical conduct.
“No doubt, the code has expanded the frontiers of accountability in the operation of companies in the sector. However, challenges still exist. For instance, the Code is declaratory in nature and implementation was initially voluntary across the industry, leading to violations.
“While compliance with the provisions of the industry Code was initially made voluntary for a period of one year, which has since lapsed, the commission is gradually moving towards a regime of stricter compliance”, he added.
Foremost expert in telecommunications law and Senior Advocate of Nigeria (SAN) Prof. Fabian Ajogwu, in his keynote underscored the need for order and adherence to rules and principles that govern the sector. He lauded the NCC for the initiative to make all stakeholders in the industry to abide by the rules and norms that govern the sector.
In regulating the sector, Danbatta said the commission will continue to push for reforms and initiatives that would create and sustain the kind of atmosphere that encourages innovation in a liberalised market.
Earlier in his address, Minister of Communications, Barr Adebayo Shittu, noted that each industry has peculiar codes guiding it and as such the telecommunications should not be different.
The minister also reiterated that it became imperative to adopt specific code of corporate governance that would enhance productivity, increase foreign investment and reducing management risk to the barest minimum.
“Good corporate governance practices boost investors trust, ensure corporate success and provide incentives for all stakeholders. It is against this backdrop that it became very imperative for the Nigerian telecoms industry to adopt and implements its own sector specific code with over ranking objective of promoting best standard practice”.
He maintained that it was imminent to gather stakeholders again after two years of such to revisit and adopt a mandatory implementation that would further accelerate the GDP of the economy.