Nigerian telecom firms have reported that they have suggested a complete 100 percent increase in tariffs to the regulator, the NCC, covering voice, data, and digital services, and are now awaiting a response.
This suggestion, which has been put forth, aims to tackle the climbing operational expenses, including inflation and higher service delivery costs.
The announcement was made by MTN Nigeria’s Chief Executive Officer, Karl Toriola, during an interview on Arise TV on Thursday.
However, Toriola indicated that it is still uncertain if the Nigerian Communications Commission will approve the suggestion.
Per Toriola, the proposed tariff increase is essential for the viability of the industry, which is grappling with notable financial strains owing to escalating operational expenses.
“We have requested a near 100 percent increase in tariffs from regulators. I doubt they’ll sanction such a substantial increase due to their sensitivity to the current economic climate in the country,” Toriola stated.
Despite the hurdles, Toriola voiced hope that regulators would arrive at a sound decision considering the sector’s realities.
The CEO stressed that the priority is ensuring the industry’s long-term viability instead of immediate profit.
“I believe we all share a common standpoint, including policymakers, regulators, our Chairman of ALTON, Gbenga Adebayo, and the industry. We’re united by mutual concerns regarding several fundamental issues. Firstly, human rights are crucial for propelling any economy. Without a sustainable industry, the larger economy and the populace’s welfare will suffer,” Toriola emphasized.
This proposal unfolds amid escalating expenses for telecom companies, spurred by factors like inflation, exchange rate volatility, and rising costs of essential operational inputs such as diesel, electricity, and raw materials.
Toriola pointed out the strain these increasing costs have placed on telecom enterprises, hindering many from sustaining profitable operations.
Earlier in the week, operators issued a cautionary statement signaling that service disruptions are on the horizon unless tariffs are modified to reflect soaring operational expenses.
Engr. Gbenga Adebayo, Chairman of the Association of Licensed Telecommunications Operators of Nigeria, characterized the telecom sector as “under siege,” attributing soaring operational expenses to inflation, fluctuating exchange rates, and rising energy costs.
He remarked that despite these challenges, tariffs have remained stagnant, leaving businesses struggling to uphold quality service and enhance their networks.
The Telcos leader cautioned that if a prompt tariff adjustment isn’t made, operators might resort to service reductions, resulting in limited access to telecom services in specific regions.
The initial request for a tariff adjustment was presented in April 2024, but little advancement has been made.
In light of escalating financial pressures, ALTON and the Association of Telecommunications Companies of Nigeria released a unified statement urging the Federal Government to initiate a constructive dialogue with industry stakeholders.
The associations underscored the importance of creating a framework that balances consumer affordability with operators’ financial health, particularly following 11 years of tariff stability.
With a collective determination to safeguard the sector’s future, operators are appealing to all stakeholders to act promptly, warning that inaction could jeopardize the survival of one of Nigeria’s most vital industries.