FG to Telecoms: Tariff Hike Not a Viable Option
The Federal Government has faulted the proposal by telecommunications companies to raise their tariffs, emphasising that increasing data, voice and text message prices isn’t the “sole or optimal solution” to the sector’s challenges.
It also urged the companies to explore innovative solutions to counter inflationary pressures and high operating costs.
The Minister of Communications Innovations and Digital Economy, Bosun Tijani, gave this advice at the launch of the Nigeria Digital Economy Report on Thursday in Abuja.
The report launched by the GSM Association, an international organisation that represents the interests of mobile network operators worldwide, analyses the Nigerian economy and the government’s digital transformation strategy.
The report also examines the role of the Nigerian mobile industry in supporting economic development and recommends initiatives to help the government achieve its national development objectives.
It also features the latest statistics as it concerns connectivity and forecasts on digitisations role in driving economic growth.
The minister told Mobile Network Operators that increasing telecom tariffs is not a viable option and should not be the singular solution to the challenges confronting the telecom industry.
According to him, the government is cognisant of the challenges and is committed to addressing them incrementally.
While making the first public comment on the issue, the minister appealed to the operators to consider suffering masses affected by the economic downturn.
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He said, “We have to deepen and address so many of these things. The solutions to these things will not come from one single thing, which is raising the tariff, that’s never going to be the solution. There are tons of other things that can be done to ensure that the business environment is conducive for the investors in this phase and the government is articulating that including the tariff conversation.
“The government may intentionally put out the right messages, the right policies and the right intentions but if everything that is coming from the association on just one issue is extremely negative, investors will not come in. Investors will not help. And if we go back to my very clear point, I’ve not seen anything more in what you are demanding that is difficult.”
He added, “It’s the approach to addressing them that I think we are not ready to do. And I’m being open about this because we must, for once, and finally, agree to address these issues positively; because they are not just affecting the companies that you represent. They are affecting the economy and the security of the nation as well.
“So we have to be extremely careful how we approach it and make sure we focus on solving it. Some of the things proposed nine months ago, if we collectively came together to address those things nine months ago, your demands would have been met. But the solution that the association is saying is only one solution. And I don’t believe anyone wants that.”
He expressed government commitment to improving infrastructure for the telecom industry. This, he said, would address multiple taxation, Right of Way (RoW), security of infrastructure, improved quality of services, and close access gaps through increased broadband penetration.
The Chief Executive Officer, of MTN, Karl Toriola, in his address, also lamented diminishing investments noting that capital investments tend to avoid areas with negative returns.
On her part, the Head of Sub-Saharan Africa, GSMA, Angela Wamola, highlighted that the high cost of doing business in Nigeria was due to the lack of digitalisation in processes.
She emphasised that simplifying the processes would enhance financial inclusion.