Economy
Telcos Want 100% Tariff Hike in SMS, Calls, Data—MTN Nigeria CEO
By Adedapo Adesanya
Telecommunication operators in Nigeria, including MTN, Airtel and others, are seeking a 100 per cent increase in tariff as stakeholders battle it out for a much-expected rise in the cost of phone calls, SMS, and internet data subscription.
The chief executive of MTN Nigeria, Mr Karl Toriola, said this in an interview with Arise News on Thursday, though he expressed doubts that the regulator, the Nigerian Communications Commission (NCC), would accept this.
“Now, we’ve put forward requests of approximately 100 per cent and type increases to the regulators,” he said.
“I doubt they’re going to approve that quantum of increases because they’re very, very sensitive to the current economic situation in the country. But we’re hopeful and optimistic that the realities are staring us in the face and the right decisions will be taken for the sustainability of the industry,” he added.
Mr Toriola lamented that the the sustainability of the telecommunications industry in Nigeria needs to be addressed, if not, it could negatively impact Nigeria’s economy.
He painted a grim reality of the escalating costs of operations, which he said has been eroded by high inflation, Naira devaluation, and rising fuel prices.
“Telecommunications is a fundamental human right these days and a critical element towards driving an economy. And if you don’t have a sustainable industry, it’s going to affect your economy and the well-being of people. Yes, everyone in Nigeria has gone through difficult times in the last few years due to economic challenges, inflation, devaluation, et cetera, et cetera.
“But the challenge that we face and we’re not talking about profitability in the industry, we’re just talking about sustainability. Profitability will come on a longer-term basis,” he said.
“Official rates have gone from about 424.50 to about 1,550 odd at the end of the year. So that has driven our cost structures up drastically. So in paying for diesel, diesel has gone from pre-COVID times from 2,300 Naira to 1,000 plus Naira.
“Petrol has gone up several folds. The cost of power generation, the cost of procuring raw materials, what we call raw materials is a lot of things, batteries, fibre cables, base stations, towers, etc. To actually roll out and maintain these networks, we pay software licensing fees for these networks.
“The costs that we’re expending are actually exceeding our revenue, even though we are seeing revenue growth. And there’s no way that the industry can continue to sustain itself and provide the required quality of service under this structure,” he explained.
He tasked the goverment to understand the critical role of telecommunications in Nigeria’s development, noting that the industry creates value as well as jobs for millions.
“We’re not talking about profitability. We are talking about an existential threat to the entire industry. We’re the biggest players, including Airtel and us. If we are struggling with these kinds of cost structures, there’s no way the rest of the industry will not experience the same.
“And the truth is, this just doesn’t affect the large operators. Every part of the ecosystem that works backwards from there is affected by exactly the same thing because they’ve all seen their cost up.”
By Adedapo Adesanya
Nigeria ranked as Africa’s leading destination for upstream oil and gas investment in 2024, new research from market intelligence firm, Wood Mackenzie, has shown, accounting for three out of four Final Investment Decisions (FIDs) announced by global oil and gas majors, totaling $13.5 billion.
The FIDs announced within the Nigerian market included Shell’s $122 million investment in the Iseni Gas Project, TotalEnergies’ $566 million commitment to the Ubeta Gas Project and Shell’s approval of the Bonga North Tranche 1 project valued at around $5 billion.
According to the Special Adviser to President Bola Tinubu on Energy, Ms Olu Verheijen, these investments reflected Nigeria’s ongoing efforts to unlock its hydrocarbon potential through investor-friendly policies and strategic global partnerships.
Last year, Nigeria introduced several initiatives to create a conducive environment for oil and gas investors, including new tax incentives aimed at attracting up to $10 billion in natural gas investments.
Nigeria, which is Africa’s largest oil producer, also offered tax relief for gas investors, reducing corporate income tax and extending capital allowance benefits – for deepwater gas projects.
Other policies include the Presidential Directive on Local Content Compliance Requirements 2024 to address the reduction in oil and gas investments caused by high operating costs compared to global markets.
Also, the Presidential Directive on Reduction of Petroleum Sector Contracting Costs and Timelines 2024 reduces the time spent to award contracts for oil and gas projects.
In addition to the directives, Nigeria also launched its 2024 oil and gas licensing round, offering 19 blocks for exploration, demonstrating its commitment to continued collaboration with local, regional and international partners.
Market analysts note that with this momentum, further FIDs are anticipated, including TotalEnergies’ expected $750 million commitment to the Ima Shallow Gas Project in 2025.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange recorded a 0.22 per cent decline on Monday, January 20, with the market capitalisation shedding N2.35 billion to close at N1.073 trillion compared with the preceding session’s N1.075 trillion and the NASD Unlisted Security Index (NSI) going down by 6.79 points to wrap the session at 3,105.12 points compared with 3,111.91 points recorded in the previous session.
It was observed that the loss recorded on the first trading day of the week was triggered by UBN Property Plc, which crashed by 20 Kobo to trade at N2.00 per share versus last Friday’s N2.20 per share.
However, the share price of Industrial and General Insurance (IGI) Plc went up by 4 Kobo to 40 Kobo per unit from 36 Kobo per unit, it could not stop the bourse from going down at the close of transactions.
The activity chart showed that on Monday, the volume of securities traded by investors increased by 57.9 per cent to 767,610 units from the 486,215 units traded in the preceding session, while the value of shares traded yesterday slumped by 17.7 per cent to N2.3 million from the N2.8 million recorded in the preceding trading day, as the number of deals declined by 14.3 per cent to 12 deals from the 14 deals carried out in the previous trading day.
At the close of transactions, FrieslandCampina Wamco Nigeria Plc remained the most active stock by value on a year-to-date basis with the sale of 4.1 million units worth N162.9 million, followed by Geo-Fluids Plc with a turnover of 9.1 million units valued at N44.0 million, and 11 Plc with the sale of 55,358 for N14.5 million.
Also, Industrial and General Insurance (IGI) Plc closed the day as the most active stock by volume on a year-to-date basis with 25.3 million units sold for N5.9 million, Geo-Fluids Plc came next with 9.1 million units valued at N44.0 million, and FrieslandCampina Wamco Nigeria Plc with 4.1 million units worth N162.9 million.
By Adedapo Adesanya
The value of the Naira weakened against the US Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Monday, January 20 amid FX pressures associated with this period.
Most people who came into the country for Christmas and New Year holidays are already going back and are in need of forex, putting pressure on the local currency.
Also, the poor performance of the domestic currency could be attributed to end to the 42-day access granted by the Central Bank of Nigeria (CBN) to Bureaux de Change (BDC) operators to buy forex at official price.
According to data from the FMDQ Securities Exchange, the Nigerian Naira lost 0.16 per cent or N2.47 on the greeback yesterday to sell at N1,550.05/$1, in contrast to last Friday’s rate of N1,547.58/$1.
Similarly, the Naira slumped against the Pound Sterling in the spot market on Monday by N23.39 to trade at N1,906.98/£1 versus N1,883.59/£1 and depreciated against the Euro by N23.14 to sell for N1,613.48/€1 compared with last Friday’s N1,590.34/€1.
However, in the parallel market, the Nigerian currency improved its value against the Dollar during the session by N5 to quote at N1,665/$1 compared with the previous session’s N1,670/$1.
As for the cryptocurrency market, it turned red yesterday as the US President, Mr Donald Trump, didn’t bring up the much-expected subject of crypto in his inauguration speech on Monday afternoon.
Mr Trump had promised a far more friendly crypto policy stance than the previous administration but in the long speech that announced his plans in the coming days, he didn’t make mention of Bitcoin or crypto.
Just over the weekend, the President ignited a speculative frenzy with the Friday evening launch of the Trump meme coin, which was shortly followed by a meme coin associated with his wife, Melania.
Dogecoin (DOGE) crumbled yesterday by 6.3 per cent to $0.3419, Solana (SOL) slumped by 4.7 per cent to $235.32, Cardano (ADA) fell by 3.6 per cent to $0.9777, and Litecoin (LTC) moderated by 1.9 per cent to $114.98.
Further, Ethereum (ETH) went down by 1.7 per cent to $3,241.36, Binance Coin (BNB) retreated by 1.4 per cent to $693.30, Ripple (XRP) depreciated by 1.2 per cent to $3.06, and Bitcoin (BTC) tumbled by 0.8 per cent to $101,746.99, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.
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