Telecoms operators seek CBN’s intervention on broadband target
19 July 2019 |
3:15 am
Telecommunications operators have said the Central Bank of Nigeria (CBN’s) intervention would be crucial to attaining the targeted 70 percent broadband penetration by 2024.
broadband
Telecommunications operators have said the Central Bank of Nigeria (CBN’s) intervention would be crucial to attaining the targeted 70 percent broadband penetration by 2024.
The operators, who spoke at a telecoms forum organised by the Association of Telecommunications Companies of Nigeria (ATCON), in Lagos, posited that attaining 70 percent target would need massive financial outlays, hence the need for financial sector support.
The Executive Director, Business Development, Broad-based Communication Limited, Chidi Ibisi, who sold the idea, said funding will remain the greatest threat to meeting the target.
Ibisi said the CBN has several intervention funds on single digit for the small and medium enterprises (SMEs), and other critical sectors including manufacturing and agriculture, have boosted jobs creation in the economy.
He noted that recently, the CBN created a fund for the creative industry. “In that creative industry fund, you have N30 million for movie production, N500 million for distribution and only N3 million for software development. They gave a three-year tenure for software development. The other sectors got 10 years.
“Obviously somebody doesn’t understand the impact or the enabling role that ICT plays in every sector of the economy. The statistics are there on how ICT impacts every sector, and as an enabler to achieving the Sustainable Development Goals. But the sector is accorded little or no support.”
Ibisi therefore appealed to the Nigerian Communications Commission (NCC), and other stakeholders to rally round the CBN for loan support at a much-reduced interest rate, and decried that operators are getting finance at 22 percent interest rate, which is not sustainable.
He also called for the deployment of the Universal Service Provision Fund (USPF), stressing that aside deployment towards education, computer facilities, “the USPF funds can be deployed towards broadband penetration, especially fibre deployment across the country.”
Similarly, the Managing Director, Information Connectivity Solutions Limited, Yemi Oshodi, said funding remained an issue and urged sector players to come together through a public and private partnership agreement.
According to him, infrastructure to underserved areas needs government support as no operator would want to go into areas that are not profit, even in the immediate term.
He revealed that only 20 million out of Nigeria’s estimated 200 million populations can actually cater to their need, while the rest 180 million are seriously broke, “therefore government must get involved seriously.”
Also contributing, the Managing Director, Bitflux Communications Limited, Lekan Balogun, identified three kinds of funds are required – $2 million; $20 million; and $50 million and above. “But without a doubt, the government doesn’t have the upper part of the funding, which is where the issue of infrastructure funding comes in.”
According to him, the absence of NITEL and national backbone has created a huge infrastructure gap in the sector; as such the industry must come together and have a position on where the government’s support is critically needed, in addition to creating the enabling environment that would attract investors.
To the Chief Executive Officer, Pan African Towers, Wole Abu, it is not just possible to go to an investment banker and ask for a loan, without them knowing the country’s risk, in terms of recouping the investment, “which is where the government now comes in by enthroning an investment-friendly environment.”
He posited that corporate governance structure will also play a critical role in driving investments, as no investor would be interested in a one-man company, where the possibility of mismanagement of funds is high.
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