Foreign investments in Nigeria’s telecommunications sector dropped significantly in the third quarter of 2024, falling to $14.4 million, an 87% decline from the $113.42 million recorded in the second quarter. This decline of $99.02 million, as reported by the National Bureau of Statistics (NBS), also marks a 77% decrease compared to the same period in 2023. The sector, which has shown growth potential, faces ongoing challenges including infrastructure deficits and high operational costs.
Despite a strong start to the year, with a sharp 769% increase in the first quarter of 2024, the sector has struggled in recent months. The first quarter saw capital importation reach $191.5 million, surpassing the total foreign investments for all of 2023. This promising trend was followed by a $113.42 million inflow in the second quarter, but the third-quarter figures suggest a sharp reversal. Industry leaders attribute the decline to persistent issues such as foreign exchange challenges, policy uncertainties, and infrastructure development needs.
The continued financial strain on the telecommunications sector is causing concern among industry stakeholders, who are calling for urgent government intervention. The Association of Licensed Telecom Operators of Nigeria (ALTON) and the Association of Telecommunication Companies of Nigeria have urged for measures to address the high operating costs, including a tariff increase to make the sector sustainable. ALTON has warned that without these changes, the industry may face significant long-term challenges.