Airtel’s CEO lists impact of telecoms sector on economy over last 12 years

…35% contribution to FDI and second largest contributor to GDP
By Uche Peter

Lagos, Nigeria; 3rd January, 2014: The chief executive officer and managing director of Airtel Nigeria, Segun Ogunsanya has hailed the impact of Global system of mobile telecommunication (GSM) on the country's economic development.

Mr. Ogunsanya, who spoke on Monday while fielding questions from journalists on the contributions of telecoms on the nation's economy, said the Nigerian economy is the greatest beneficiary with about 35% of the country's cumulative FDI (Foreign Direct Investment) between 2001 and 2011 attributable to telecommunications.

In his words, “The telecoms sector is a major stakeholder in the area of Foreign Direct Investment pull to the Nigerian economy. Along with the banking and oil and gas sectors, cumulative FDI in Nigeria over the 2001-2011 period, stands at about US$45bn with the telecoms sector accounting for about 35% of that amount. During some individual years (e.g. 2009), the telecoms sector provided more than half of the country's FDI. Today, the Telecoms industry is the second largest contributor to the nations GDP. With 8%, the industry ranks next to the Oil and Gas industry”

Speaking further, the Airtel boss said the operators in 2012 alone made a direct contribution of around N400 bn, with taxes and regulatory levies accounting for about 55% of this.

Mr. Ogunsanya also noted that the industry has been visible in the volume of new job opportunities created as well as in the development variety of required skillset.

“Nigerian operators have created close to 10,000 direct jobs since liberalization, a pace of nearly 1,000 direct, full time equivalent (FTE) positions created each year. On an indirect basis, the total number of jobs created by the telecoms operators hovers between 1m and 3m depending on the estimates,” he said.

Ogunsanya also expressed optimism about the consistent efforts of operators towards guaranteeing quality services to subscribers, saying all stakeholders in the sector must play their roles and cooperate in order to improve quality of service.

He noted that Airtel, as an innovative telecoms operator, is determined to improve voice and data services to subscribers in Nigeria, adding that top among the agenda of Airtel from the year 2014 is to offer unprecedented high quality service to new and existing subscribers in the country, noting that there would be investments and boost in the transmission capacity of Airtel. He noted that Lagos and other states across Nigeria will witness improved services as a result of renewed commitment.

“As a leader in new technology and innovation, Airtel has repositioned to become Nigeria's leading internet company. While we are still very much active in the voice market as one of the dominant leaders, we are now defined as a data centric organisation,” Ogunsanya explained, adding that the Telco has the largest 3.75G network in the 36 states including the Federal Capital Territory in Nigeria.”

He further buttressed the recent report by the Pyramid Research which noted that Nigeria is the largest mobile market in sub-Saharan Africa in terms of subscribers and the region's largest in revenue. He said, “mobile penetration stood at 66 per cent at the end of 2012, from less that than 1 percent in 2001. Annual subscriber growth over the past five years was about 20 percent, one of the world's fastest growth rates over that period.”