‘How to protect telecoms sector’s $68billion investments’
According to industry experts, the sector’s investments put at about $68 billion need to be adequately protected against bad policies.Considering the importance of the sector to the economy, market observers believed that should there be any adverse policies on the sector, the effect will be spiral, as information and communications technology (ICT) have become the infrastructure of infrastructures, not only in Nigeria, but globally.
Speaking to The Guardian, the President of the Association of Telecommunications Companies of Nigeria (ATCON), Olusola Teniola, said the operating landscape in Nigeria was extremely tough in 2016, considering the issues and headwinds that confronted the industry.
According to Teniola, these challenges included the foreign exchange issues, which resulted into steep devaluation of Naira versus the USD$ and impacted negatively on the Capital Expenditure (CAPEX) program of many operators in the telecoms industry.
He added that the threat of further taxes being imposed on the industry in the form of Communications Services Tax (CST) and other problems, including reduced Foreign Direct Investment into the telecommunications sector and then the contraction of revenue accrued to the industry versus previous years’ astronomical growth are instances that should be avoided in 2017.
The ATCON President said the last quarter in 2016, was fueled by the realisation that predatory pricing has crept into the industry and the Nigerian Communications Commission needed to deal with this in terms of wholesale price determination interventionary measures.
“The Central Bank of Nigeria (CBN) and National Assembly finally sought oversight on one of our members and this has caused confusion and uncertainty in the investment community about the sincerity of Nigeria in respecting repatriation of profits made in the past and has halted further investments much needed to expand and upgrade network capacity to achieve the requisite QoS – the investment community is generally in a ‘let’s wait and see’ mode at the moment concerning significant investments in Nigeria,” he stressed.
But to the President, National Association of Telecommunications Subscribers of Nigeria (NATCOMS), Chief Deolu Ogunbanjo, government agencies are not most times transparent, reason searchlight are always beamed on them and this extend to the corporate world.
Ogunbanjo, who said though nothing seems to have come out from cries of the Senate over what it described as the illegal repartriation of funds by MTN, he however, stressed that the NCC and the CBN should ensure there is transparency in the operations of telecoms operators in the country.
According to him, all the operators include MTN, Airtel, Globacom, Etisalat and even nTel operations should be looked into critically to ensure they are not violating rules and regulations guiding their operations in the country. He said a sector without transparency is capable of hindering economic growth.
To the Association of Licenced Telecoms Operators of Nigeria (ALTON), operators are responsible corporate body that governments should treat well.ALTON Secretary and Head of Operations, Gbolahan Awonuga, said nothing came out of the Senate brohaha that MTN illegally repartriated funds.
Awonuga said it will be better for the NASS to come out with better policies that will attract investments to the telecoms sector and the economy as a whole.
ALTON chief said government should be proactive, especially now that the economy is in recess, government should come out with waivers to encourage growth.
Already, the Minister of Communications, Adebayo Shittu, while speaking to Reuters, wants Nigerians to encourage MTN and others, and not scare them away from the country.
Shittu said MTN is important to Nigeria and the presumption is that they are innocent of the latest allegations leveled against the company.“Nobody will say that MTN is not important to Nigeria – we must encourage them, we must not scare them away from Nigeria,” Shittu told Reuters in an interview.“The presumption is that they are innocent and we pray they remain innocent. They must stay,” he stated.
MTN has said it did not break Nigeria’s currency transfer rules.Shittu’s comments are similar to those he made when MTN was initially fined $5.2 billion in 2015 — equal to more than two years of its Nigerian profits — for failing to cut off unregistered SIM cards. The fine was reduced last June to 330 billion naira ($1.1 billion).
The crux of the allegation into illegal money transfers is that MTN did not obtain certificates declaring it had invested foreign currency in Nigeria within a 24-hour deadline stipulated in a 1995 law, and so the repatriation of returns on those investments was illegal.
“They have a right to repatriate their profits as long as it is legitimately done,” said Shittu, adding that any time MTN is suspected of breaking the law, it will be investigated, though the “facts against them must be established beyond reasonable doubt.”
“Everyone who is in business will have ups and downs. You don’t throw away the baby with the bathwater.”Shittu said the investigation was an issue for financial regulators and did not fall within his “constitutional responsibility.”
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