33% Interest Rate Crisis Threatens Nigeria’s $1tr Economy Ambition, Telcos Warn
Nigeria’s telecommunications industry is under severe financial pressure as operators warn that Nigeria’s 33 per cent interest rate environment is threatening the sustainability of the sector and the country’s ambitious $1 trillion economy target by 2030. The Association of Telecommunications Companies of Nigeria (ATCON) raised the alarm during a Nigerian Communications Commission (NCC) stakeholder consultation on mobile termination rates.
According to ATCON, telecom operators are struggling under a combination of high borrowing costs, foreign exchange volatility, inflation, and rising expenses tied to imported network equipment, diesel, and logistics. Despite these challenges, the sector has expanded significantly from $500 million at liberalisation in 2001 to over $75.6 billion today, showing both resilience and growing economic importance.
ATCON’s Coordinator of Telephone Operators, Chidi Ibisi, said operators are still planning to invest about $1.38 billion this year to improve network capacity, coverage, and service quality. However, he warned that such investment levels are becoming increasingly unsustainable without cost-reflective Mobile Termination Rates that properly match operating realities.
The association also highlighted operational challenges such as fibre optic cable damage from road works and vandalism, theft of equipment like generators and batteries, high Right-of-Way charges, and multiple taxation across states. It called for regulatory action based on Section 108 of the Nigeria Communications Act to ensure fair and investment-friendly tariff structures.
Meanwhile, the Federal Government has dismissed claims that it is introducing new taxes on telecom services or fuel following the IMF’s Article IV Consultation Report. The Ministry of Finance clarified that IMF recommendations are advisory and not binding, adding that VAT waivers on petroleum products remain in place and any fuel surcharge would require formal ministerial approval and publication in the Official Gazette.
sopurce: The guardian