Nigeria's Telecom Industry Risks Losing Foreign Direct Investments Over NITDA Bill, Say Experts.

 

Nigeria's telecommunications industry is at risk of losing foreign direct investments (FDIs) if the National Information Development Agency (NITDA) Bill is passed, according to stakeholders in the sector. The proposed bill would change NITDA's status from a developmental agency to a regulatory body, adding another layer of regulation for investors to navigate. This move could discourage foreign investors from investing in the industry and further shrink the already limited FDIs coming into the telecoms sector.

Proposed NITDA Bill Risks Multiple Regulations and Taxes in Nigeria's Telecoms Industry

Representatives of the two leading telecom industry associations in Nigeria, the Association of Telecommunications Companies of Nigeria (ATCON) and the Association of Licensed Telecommunications Operators of Nigeria (ALTON), have called for the withdrawal of the bill. They believe that having NITDA as another regulator in the telecom sector would send the wrong signal to investors, as they would have to face multiple regulations and fees if they invest in the industry.

The Executive Secretary of ATCON, Mr. Ajibola Olude, warned that if the bill is passed into law, it would negatively impact FDIs coming into the sector. Foreign investors are closely monitoring the situation and have observed the anomalies in the bill regarding multiple regulations and multiple taxation. This bill is capable of eroding the gains the telecom industry has recorded over the last 21 years.

"The new NITDA bill is not an amendment but a reenactment, as it seeks to make the agency a regulator. There were agencies already carrying out regulatory functions in the ICT industry." Oke also noted. 

The Head of Operations at ALTON, Mr. Gbolahan Awonuga, pointed out that NITDA Nigeria should focus on its developmental roles instead of trying to regulate the same space that is already being regulated by the Nigerian Communications Commission (NCC). Adding regulatory functions to NITDA's agenda would only duplicate existing laws and policies.

ALTON and ATCON Unite Against NITDA Bill, Call for Focus on ICT Development

The Chief Executive Officer of ICT Derivatives Ltd., Mr. Ayoola Oke, said that the NITDA Act of 2007 had a central purpose of facilitating the adoption of ICT throughout the nation in the private and public sectors, and consequently supporting its infrastructure and connectivity. The new NITDA bill is not an amendment but a reenactment, as it seeks to make the agency a regulator. Oke also noted that there were agencies already carrying out regulatory functions in the ICT industry.

While NITDA has been a major contributor to Nigeria's ICT development alongside other agencies of the government under the Federal Ministry of Communications and Digital Economy, the dust raised around its pending Bill could not be ignored in the interest of Nigeria's growing ICT sector and the country's fast-pacing digital economy drive. The NITDA Act 2007 established the agency to use ICT as a tool in tertiary institutions to drive the mechanism of the education sector in the country. NITDA is empowered by its enabling Act to create a framework for the planning, research, development, standardization, application, coordination, monitoring, and evaluation of IT practices, activities, and systems in Nigeria.

If the NITDA bill is passed, it will be a blow to Nigeria's efforts to attract FDIs to its telecoms sector. The country is already struggling to attract investments, and this bill could discourage foreign investors from investing in the industry. The government should reconsider the bill and focus on promoting a friendly business environment that attracts investors, rather than creating more regulations that will hinder the growth of the sector.

By

Engr. Gbolahan M.A. Alabi-Isama MS.