After its Federal Executive Council meeting, Nigeria’s Minister of Communications, Innovation, and Digital Economy, Dr. Bosun Tijani, announced that the government has secured two significant approvals to enhance internet connectivity and drive digital growth in Nigeria.
The first approval is for the launch of a Special Purpose Vehicle (SPV) to deliver an additional 90,000 kilometers (km) of fiber optic cable, complementing the existing connectivity infrastructure and strengthening the national backbone for universal internet access across Nigeria. The country currently has about 78,000km of fiber optic cables.
“Working with partners and stakeholders from the government and private sector, this SPV will build the additional fiber optic coverage required to take Nigeria’s connectivity backbone to a minimum of 125,000km, from the current coverage of about 35,000km. Upon delivery, this will become Africa’s 3rd longest terrestrial fiber optic backbone, after Egypt and South Africa,” Dr. Tijani said.
According to the statement, the extensive coverage will enable Nigeria to optimize its existing 8 submarine cables, with a carrying capacity of over 400 TBPS, and drive data capacity uptake above the current usage level of 10%.
The Minister claims that the project will improve internet inclusion for at least 50% of the 33 million Nigerians currently outside the broadband envelope, contribute up to 1.5% of GDP growth per capita, and raise GDP from $472.6 billion (2022) to $502 billion over the next four years.
The Nigerian government previously announced it would raise $3 billion from the World Bank to build an additional 120,000km, with the first phase targeting the installation of 95,000 km.
The Minister’s announcements come within a period of exacerbated financial challenges faced by the telecommunications industry. The country’s biggest telecom operators, MTN and Airtel collectively lost N1.29 trillion ($12b), attributed to currency devaluation, rising inflation, energy costs, and the introduction of the 2023 Finance Act VAT on tower leases, resulting in higher operating expenses.
To address the industry challenges, Dr. Tijani established a 5-man committee in March 2024, seven months following his appointment as Minister of Communications, Innovation, and Digital Economy. This committee was entrusted with a six-point mandate aimed at resolving impediments hindering telecommunications companies from delivering quality services nationwide. However, the committee’s report, expected within a month of its formation, is yet to be disclosed.
The Minister can walk and chew gum at the same time. While targeting new innovation and planting the seeds for future technology growth, it is important to resolve existing industry issues, of incessant fiber cuts, multiple taxes, excessive right-of-way fees, insecurity, high energy costs, and inflation.
Since 2021, broadband investments have seen a downturn following a peak of over ₦1 trillion in the industry and foreign investments totaling $753 million. Both domestic and foreign investments have dwindled by nearly half since 2022, prompting operators to cut operational expenses. While Africa Hyperscalers expects the announcements of the proposed partners and execution of the 125,000 new fiber networks slated for completion within four years, we implore the Minister to tackle the current industry challenges.
