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Naira Devaluation: Expect Price Hike, Telcos Tell Subscribers



Telecommunication firms have said they are working with their regulator, the Nigerian Communication Commission, to review the prices of their services to reflect prevailing market realities, especially the recent unification of the foreign exchange market.

According to the telcos, a price review is needed for their industry to remain sustainable. The president, Association of Licensed Telecoms Operators of Nigeria, Gbenga Adebayo, disclosed this to The PUNCH in an interview. He explained that the price review is needed to reflect the cost of production.

This is following a new FX policy regime introduced by the Central Bank of Nigeria. The apex bank recently asked Deposit Money Banks to remove the rate cap on the naira at the official Investors and Exporters’ Window of the foreign exchange market, to enable the free float of the naira against other foreign currencies.

This is to bridge the gap between the official and parallel rates of the naira. This move, according to Adebayo, has tipped the scale in favour of a price review in the industry.

He told The PUNCH, “For our industry to remain sustainable, our prices have to reflect the cost of production. This goes without saying that we will also review rates at the appropriate time after consultation with all the stakeholders to reflect the current cost of inputs.”

Adebayo noted that telcos are not isolated or immune from what is happening in the economy. He stated, “When the input cost goes up, prices will also go up. So, in order for the industry to be sustainable, and for us to continue to maintain the grade of service that we deliver, it is only realistic that we review prices.

“We are providing all the necessary information to the regulators.”

He clarified that these discussions have been ongoing for a while, with telcos getting approval to review prices for a while under the last administration. However, he said that the new Forex regime has made an increase paramount.

Adebayo said, “We’ve been discussing this before the end of the last administration, and in actual fact, approval was granted for price review at the time, but we had some interventions that asked that it should be put on hold, which again does not reflect the reality of what we face. So, it is only normal to expect that there will be a price review.

“But it is not only FX that will influence this. It is in addition to other elements and parameters of the cost that we had mentioned in our previous submission to get a review of rates. This other condition will constitute further information, reason, and basis to justify the review of prices.”

Recall that in 2022, telcos wrote a letter to the NCC requesting for a 40 per cent hike in the price of data, calls, and SMS due to the rise in their cost of operations.

They were seeking to increase the floor price of calls from N6.4 to N8.95 and the price cap of SMS from N4 to N5.61.

They said, “Upward review of the price determination for voice and data and SMS. Given the state of the economy and the circa 40 per cent increase in the cost of doing business, we wish to request for an interim administrative review of the mobile (voice) termination rate for voice; administrative data floor price, and cost of SMS as reflected in extant instruments.”

A telecom expert, who asked not to be named, also confirmed that telcos were pushing for an increase in the delivery cost. The expert noted that the industry has not been able to respond to price shocks and it has begun to affect it.

The expert said, “If we keep pegging prices and we cannot respond or adjust based on the reality on ground, we can’t keep subsidising consumption indefinitely.

“This will eventually lead to a price review. This should have happened before now. It has been on the table, we had been putting up with a lot of things, we need some type of help. We have been leveraging on volume, but it is a business we need to keep investing in, upgrading the tech, and it is money.”

Since the President Bola Tinubu administration began with the removal of fuel subsidy on May 29, 2023, prices of many goods and services have risen. Mobile telecommunication service is crucial to the Nigerian economy and is a crucial component of its GDP.

As of April 2023, there are 223.34 million mobile subscriptions in the country. Raising prices of telecom services is set to affect everyone, the president, National Association of Telecoms Subscribers, Adeolu Ogunbanjo, told The PUNCH.

He said, “They can’t increase prices now, that will be totally insensitive. Fuel subsidy is gone, electricity is planning an upward review, we are against this. It will affect businesses again, telecoms is everything to us.”


Steel manufacturers hail Tinubu over $14bn deal



Kamoru Yusuf

The Basic Metal, Iron and Steel Products Manufacturer, a sectoral arm of the Manufacturer Association of Nigeria, (MAN) has commended President Ahmed Bola Tinubu for his overwhelming performances and efforts towards the nation’s economic growth at the just concluded Nigeria-India economic roundtable meeting in India.

The group also commended the president for attracting the sum of $14 billion investment to boost the nation’s economy adding that the feats recorded by the Bola Tinubu-led government within 100 days of its inauguration will no doubt accelerate economic recovery and business growth in the steel sector.

This is contained in a statement issued on Sunday by the Chairman of the group, Dr. Kamoru Yusuf MON, stressing that, “Iron and Steel sector, if given the required attention and necessary support, is capable of ensuring accelerated growth of the nation’s economy.

Dr. Yusuf, who is also the Group Managing Director of KAM Holding Limited, a wholly owned indigenous Iron and Steel Industry in Nigeria added that, “President Tinubu has by all standards demonstrated his love and readiness to support industrialists. We, in the Iron and Steel sector of the Manufacturers Association of Nigeria, (MAN) are ready to support his administration with data, workable templates and roadmaps that will support Mr. President in his endeavour to succeed in his mandates to Nigerian citizens.

“As major stakeholders in Nigeria’s Project, we received this news with huge excitement and sense of fulfillment and hope that the breakthrough will further change the game of operations as ‘Risk Takers’ in the nation’s business environment. We pledge our unalloyed support to your administration towards ensuring and providing enabling atmospheres for industrialists to continue to thrive.”

The statement also emphasised that, “President Tinubu’s exceptional efforts in attracting such a substantial investment for Nigeria’s steel sector deserves standing ovation and applause.”

The group therefore promised to continue to support the Minister for Steel Development, Alhaji Shuaibu Audu, in the discharge of his duties at all times.




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Ex-CBN director urges FG to reduce cost of governance



Dr Titus Okunrounmu, Former Director of CBN

Dr Titus Okunrounmu, former Director, Budgetary Department at the Central Bank of Nigeria (CBN), has advised the Federal Government to reduce the cost of governance in order to stem the country’s debt profile.

Okunrounmu, who gave the advice while speaking with the News Agency of Nigeria (NAN) on Thursday in Ota, Ogun, described the list of ministerial portfolio on Wednesday as over bloated for a country with huge debt profile.

According to him, funding the nation’s recurrent budget with borrowing does not need these large number of ministers and bloated special assistants, which inevitably must allow for allowances and official vehicles.

“These excess baggage was not projected for in the 2023 Federal Budget and the revenue estimates could not cover the recurrent budget.

“In addition, the federal government needs financial discipline to curb corruption in the Ministries, Departments and Agencies (MDAs) to reduce debt profile in the country,” he said.

Okunrounmu advised the federal government to redouble its efforts and work against policy somersault to encourage influx of foreign investors into the country.

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