Insecurity and Multiple Taxes Hindering Nigeria’s Digital Economy, Says NCC Boss

The Executive Vice Chairman of the Nigerian Communications Commission (NCC), Prof. Umar Danbatta, has highlighted the challenges faced Nigeria in achieving its broadband and digital economy aspirations. Speaking at a recent forum, Danbatta identified insecurity and multiple taxes as major barriers to the country’s digital development.

Insecurity in Nigeria has a significant impact on long-term planning and investment, according to Danbatta. The prevalence of insecurity challenges hampers the deployment of broadband infrastructure and discourages investments in the telecom sector. Additionally, the NCC boss expressed concern over the increasing number of telecom taxes, which have reached 46. Multiple taxation not only raises the cost of doing business but also dampens economic activity, investment, and innovation.

The geographic diversity of Nigeria poses another obstacle to broadband deployment, particularly in remote and rugged terrains. The high upfront costs of building broadband infrastructure further hinder investment in the sector. These challenges, however, can be overcome through determined efforts, innovation, and strategic planning.

Danbatta emphasized the importance of Nigeria’s digital aspirations in unlocking the country’s full economic potential and promoting inclusive growth. He defined broadband as an interconnected ecosystem that encompasses digital readiness, development, opportunity, and inclusiveness. To achieve the National Broadband Plan’s targets of 50% broadband penetration 2023 and 70% 2025, careful planning and investment are required.

However, a decline in telecoms investment, coupled with limited forex availability, security concerns, and other structural challenges, may impact the achievement of these targets. The World Bank reports negative net foreign direct investment (FDI) inflows into Nigeria due to equity withdrawals foreign investors. FDI and foreign portfolio investment do not compare favorably with other economies, reflecting the difficulties faced Nigeria in recent years.

Addressing the barriers and focusing on success factors can enable Nigeria to create a future where every Nigerian has access to the digital opportunities that the digital world offers, concluded Danbatta.

Sources:
– Association of Telecom Companies of Nigeria
– Nigerian National Broadband Plan (2020-2025)
– World Bank’s ‘Nigeria Development Update (December 2022): Nigeria’s Choice’ report.