Rollout of 5G increases foreign investment in telecom by 129%

 

According to data on capital imports provided by the Central Bank of Nigeria, the implementation of fifth-generation technologies and investments in communication infrastructure increased foreign investments into the telecommunications sector by 129.21% in the first eleven months of 2022.

Between January and November 2021, the telecom sector imported $174.47 million in capital. When compared to the same period in 2022, it increased to $399.91m.

This increase in investment comes after MTN Nigeria and Mafab Communications Limited successfully won 5G spectrum auctions in December 2021. To successfully roll out 5G in 10 of the nation's biggest cities, telcos would need to invest $500 million and construct 6,000 base stations, according to the GSMA, the international organization for telecoms.

MTN Nigeria and Airtel Africa revealed in 2022 that they had invested N613.13 billion in infrastructure. This represented a rise of N536.91 billion, or 14.19 percent, from what they both spent in 2021.

In response to questions about its investment, MTN stated that their "capital expenditure was N504.3bn, up 23.5 per cent, due to acceleration in coverage expansion, with an emphasis on the 4G and 5G networks and our rural telephone initiative.

"We installed 7,784 rural sites, 588 5G sites, and 9,027 4G sites. A little over 76% of the sites set up during the year were 4G-related.

Experts in telecom predict that 5G will dominate network investment and attract international capital to the industry. Due to a variety of circumstances, foreign investments have decreased in Nigeria in recent years. Nonetheless, experts predict that the profit margins and growth seen in the communications sector will continue to fuel expansion.

The Chief Operating Officer of the Association of Telecommunications Companies of Nigeria, Ajibola Olude, commented on the sector's expansion by saying, "5G has contributed to this growth, which has led to higher investments.

"Investments are being driven by the rollout of 5G, and they are coming from abroad. Growth is also being fueled by investments in 5G technology.

Additionally, he claimed that a number of federal and state government measures are luring international investors into the industry.

You will notice that the number of data centers in Nigeria has skyrocketed, and this is also to blame for great, he continued. The digital economy offers several prospects, which is motivating investors to participate in the industry.

Also, the industry has grown to be the pride of the Nigerian economy, which has led to a rise in the use of digital and communication products. Another contributing to this expansion is the return on investment.

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Emmanuel Ukaoha has 4years Experience in Journalism, he is also a Web Developer and an SEO Expert. You Can also Connect with him on Instagram and Linkedln.