Nigerian ICT matrix contributions to GDP, by Adefolarin Olamilekan
The beginning of the 21st century witness a rising tide in globalization. Courtesy of the four significant mechanisms that made it possible through financial capital, technological innovation, human capital development, and global peace promotion.
Exclusively, technology innovation birthed the penetrating forces behind Information and Communication Technology (ICT). And, that ensures a seamless embracement of globalization and its economic enthronement. Although this piece is not about globalization, we reemphasize and acknowledge its strong effects delivered through the ICT matrix. Again, globalization has its criticism, especially, regarding the third-world countries’ economic successes.
Convincingly, the route of Information and Communication Technology (ICT) impacts the global economy, while granting the current century as an information technology revolution phenomenon. This is in reference and contrast to previous revolutionary ages witnessed; Stone Age, Slave Epoch, Agricultural, and Steaming Engine Industrialization.
Instructively, the ICT revolution brought about cutting-edge articles raging from; satellite, internet, mobile phone, Fin-Tech, spectrum broadband, wireless penetration, virtual work station, and emerging Artificial Intelligence (AI).
Without a doubt, these are links through which ICT shaped and is still reshaping global economic activities. Significantly, by disrupting the status quo and re-establishing new ones.
Arguably, human society has come to reckon with ICT, as the world we live in today, is the beacon of the ICT matrix.
Critically, a modest history of ICT penetration in Nigeria dated back to the pre-2000 millenniums, and emphatically, with the Government’s seriousness in ensuring every Nigerian household acquired table phones in the 1970s.
Beyond that, trends in the Government policy fiat came through in the early 2000s with mobile telephones licenses and other sectoral approach frameworks.
Interestingly, ICT in Nigeria gain momentum in the road as an economic progression determinant since then.
That is why in today’s breaking news you would never seize to hear about the manner ICT impacts the health of the nation’s Gross Domestic Product (GDP). In fact, that is why Nigeria’s GDP is approximately valued at over $500 billion. With the oil and gas industry having the larger share, and dominating every other industry.
To draw the Government’s attention over the years to target a shift from the petrol dollar rentier economy with less real growth and appreciable development, however, there must be a deliberate refocusing on the non-oil sector, to rejuvenate the entire economy. ICT is steering the ship toward the Government’s ambition of economic diversification.
Consequently, a recently outstanding performance of ICT in the Nigerian economy was published by the National Bureau of Statistics (NBS). According to the NBS “ICT services have contributed N2.508 trillion to Nigeria’s GDP in the first quarter of 2023”. We can relate this to how activities in the ICT sector contributed 16.22% to Nigeria’s real Gross Domestic Product (GDP) in Q4 2022.
Simply, on a year-on-year basis, the sector growth rate increased by 10.72 percent in 2022, higher than the 7.28 reported in 2021. For instance, in 2022 ending, the contribution of the Nigerian ICT sector to the Gross Domestic Product (GDP) grew by 9.76 percent from 6.55 percent to statistics reported in 2021.
Again, the 2022 full-year GDP report released by the NBS, shows that the ICT sector contributed 16.51 per cent to the overall GDP, and that of 2021 stood at 15.51%.
Succinctly, this is a rated performance from the sector compared to the previous statistics.
Understandably, NBS arriving at these statistics involved the calculations of 46 distinct sectors of the economy, which constitute oil and gas, ICT, manufacturing, banking, insurance, real estate, construction, transportation, and other services baskets.
Meanwhile, the ICT sector in Nigeria entails the following: Telecommunications and Information Services, Publishing, Motion Picture, Sound Recording, Music Production; and Broadcasting.
However, a lot of factors are said to be responsible for this impressive outing of the ICT contributions to the Nigerian GDP.
Data from the Nigerian Communication Commission (NCC), revealed the number of phone subscribers in Nigeria as of April 2023 stood at 223.6 million.
This is also followed by the number of Internet subscribers for the same period which stood at 157 million, while broadband subscriptions equally at 92 million.
Yet still, there are other deliberate efforts by the Government and stakeholders in the private sector which transitioned to online engagement. Worth mentioning is the Central Bank of Nigeria’s (CBN) cashless policy economy, and the emerging embrace of Fin-Tech services by individuals and organizations alongside the use of USSD, mobile, and internet banking.
We can both mention the revenue generated by the Federal Government – 820.8 million dollars for the 5G spectrum licenses from three operators, MTN, MAFAB, and Airtel, within the period under review.
Moreso, FDI has also been bringing in capital importation in the ICT sector, adding to the growth in the Nigerian economy, with the likes of Elon Musk-owned SpaceX having its issuance of the licence for satellite-based wireless broadband services.
ICT in Nigeria, indeed, shows a positive outlook, which is credited to the innovative and predictable telecoms regulatory environment and others.
Although the sector still has its challenges, particularly in interior areas penetration and multiple taxation complaints., nonetheless, for the Federal Government to increase the contribution of the ICT sector to GDP through a five-year plan, all hands must be on deck where the Government prioritizes what is necessary to achieve the set goal by the end of the year 2025.
In the long run, the Nigerian ICT matrix is the reason for the GDP growth, and still counting.
Adefolarin A. Olamilekan is a political economist. He can be reached via
Email: adefolarin77@gmail.com
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