Telecom Sector Attracts Just $7.24m Foreign Capital in Q1 2026 Despite Tariff Hike

Foreign investment into Nigeria’s telecommunications sector has dropped sharply to just $7.24 million in the first quarter of 2026, marking its weakest performance in over four years, according to fresh data from the National Bureau of Statistics (NBS).

The figure represents a steep decline despite expectations that the 50 per cent tariff increase approved by regulators in 2025 would strengthen operator revenues and attract fresh capital into the industry. Instead, investor confidence appears to have weakened further, with inflows falling to their lowest level since late 2021.

The NBS report shows that telecom capital importation accounted for only 0.07% of Nigeria’s total $10.37 billion foreign inflows recorded during the quarter. This also reflects a 91.04% year-on-year drop compared to $80.78 million in Q1 2025 and a 92.99% fall from the previous quarter, highlighting a sustained downturn in sectoral investment appetite.

Despite the telecom slump, Nigeria’s overall capital importation surged during the same period, driven largely by strong inflows into banking and finance. The banking sector alone attracted $7.55 billion—accounting for nearly 73% of total inflows—while the finance sector followed with $2.43 billion, together dominating more than 96% of foreign investment.

Industry analysts note that although telecom operators benefited from tariff adjustments and increased infrastructure spending exceeding N2.5 trillion in 2025, foreign investors remain cautious due to persistent challenges such as high operating costs, foreign exchange volatility, and infrastructure constraints, raising questions about the sector’s near-term investment outlook.

 source: nairametrics