World Bank links Nigeria’s ICT growth to high data consumption
TECHDIGEST – Increased consumption of data services and the continued rise in subscriber numbers are driving Nigeria’s information and communications technology sector growth, the World Bank has disclosed.
The global bank stated that those two factors were responsible for the 10.3 per cent year-on-year expansion that the sector witnessed in the first quarter of 2023.
It revealed this in its latest report titled ‘Nigeria Development Update (June 2023): Seizing The Opportunity’.
It said, “Strong growth in telecommunications and financial services supported a 4.3 per cent y-o-y increase in services output in Q1 2023.
“The information and communications technology sector, which did not contract even during the 2020 recession, expanded by 10.3 per cent y-o-y due to increased consumption of data services by households and businesses and higher subscriber numbers.”
In 2022, the ICT sector contributed N12.32tn to real GDP as against the N11.23tn recorded in 2021, according to the National Bureau of Statistics.
It contributed N21.15tn to nominal GDP in 2022, an increase from the N17.78tn it did in 2021.
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The ICT sector was one of the pillars of the country’s economy, driving the service sector, which contributed 56.27 per cent to aggregate GDP in the fourth quarter of 2022.
In the first quarter of 2023, the service sector drove the performance of the country’s GDP, recording a growth of 4.35 per cent and contributing 57.29 per cent to aggregate GDP.
Commenting on the ICT sector’s performance in Q1, 2023, the NBS said, “In nominal terms, in the first quarter of 2023, the sector growth was recorded at 41.84 per cent (year-on-year), 21.30 per cent points increase from the rate of 20.54 per cent recorded in the same quarter of 2022, and 20.43 per cent points higher than the rate recorded in the preceding quarter.
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“The sector in the first quarter of 2023 recorded a growth rate of 10.32 per cent in real terms, year-on-year. From the rate recorded in the corresponding period of 2022, there was a decrease of 1.75 per cent points.”
The total number of mobile telecom subscriptions rose by 13.89 per cent to 222.23 million in 2022 from the 195.13 million in 2021, according to the Nigerian Communications Commission. At the end of the first quarter of 2023, it had risen to 225.82 million mobile subscriptions.
Mobile Internet subscriptions grew by 8.94 per cent in 2022 to 154.28 million from 141.62 million, indicating an increase in Internet usage in the country.
While details about data usage for 2022 has not been released, data consumption has been on a steady rise in the country.
In 2021, it grew to 350,165.39TB from 205,880.4TB.
According to the latest Ericsson Mobility Report (June 2023), data consumption has been surging due to rising smartphone subscriptions and increasing average data volume per subscription, fueled primarily by increased viewing of video content.
It predicted that data usage in Nigeria would spike in the coming years.
It said, “Sub-Saharan Africa is forecast to be the region with the highest growth in total mobile data traffic, rising by 37 per cent annually between 2022 and 2028 as service providers across the continent continues to invest in 4G networks and migrate customers from 2G and 3G.
“This increase in data traffic will primarily be driven by a four times increase in smartphone traffic in the period, with average data per active smartphone settling at 19 GB per month in 2028.”
According to the former Minister of Communications and Digital Economy, Professor Isa Pantami, the ICT sector contributes thrice as much as the oil and gas sector to the country’s GDP.
He said, “For over 50 years, Nigeria relied so much on oil and gas. But today, we have reached a situation where the contribution of ICT to our gross domestic products in Nigeria is almost three times the contribution of oil and gas to the country’s GDP.
“In the last three years, we have set up three unprecedented records with regard to ICT contributions to the GDP.”
Punch
