The Nigerian telecommunications sector is taking decisive steps to counter economic headwinds, as a 50 per cent tariff hike approved by the Nigerian Communications Commission (NCC) seeks to stabilise an industry battered by currency devaluation and rising operating costs.
While the sector played a key role in Nigeria’s economic recovery from the 2020 recession, its growth rate slowed to 5.42 per cent in 2024, down from 7.91 per cent the previous year, according to the National Bureau of Statistics (NBS).
This decline follows a steep devaluation of the naira, which fell from N415.07/$ in 2021 to N1,500/$ in 2024, significantly impacting telecom operators.
MTN Nigeria’s revenue soared by 103.16 per cent to N3.36 trillion in 2024, but the company posted a N400.44 billion loss after tax due to a N925.36 billion foreign exchange loss.
Airtel Africa’s revenue saw modest growth of 4.99 per cent, reaching $4.76 billion, yet its Nigerian operations suffered a 40.34 per cent revenue drop to $738 million.
Operating costs surged as well, with MTN Nigeria’s expenses climbing 76.6 per cent to N1.52 trillion. Airtel Africa attributed rising costs to currency devaluation across Nigeria, Malawi, and Zambia, noting that average diesel prices in Nigeria jumped 60 per cent.
The GSMA warns that sustained revenue declines in the telecom industry could hurt GDP growth and slow digital adoption.
However, the recent NCC-approved tariff adjustment, the first since 2013, is expected to bridge the gap between rising costs and stagnant tariffs.
Operators anticipate that the hike will not only improve financial stability but also enhance network quality and drive future sector growth.
MTN Nigeria projects an additional N1.34 trillion in revenue from the adjustment, while its CEO, Karl Toriola, and Airtel Nigeria CEO, Dinesh Balsingh, emphasised that reinvestment in infrastructure and innovation will be key to securing the sector’s long-term sustainability.
