MTN Nigeria has announced that telecommunications firms are requesting a complete 100 percent increase in tariffs; however, it is unclear if the Nigerian Communications Commission, the regulatory body for the telecom sector, will endorse this request.
This information was shared by Karl Toriola, the Chief Executive Officer of MTN Nigeria, during an interview on Arise TV on Thursday.
Toriola emphasized that the proposed increase in tariffs is essential for the industry's sustainability, which has been under considerable financial strain due to escalating operational expenses.
“We’ve put forward requests of approximately 100 per cent tariff increases to regulators. I doubt they’re going to approve that quantum of increases because they are very, very sensitive to the current economic situation in the country,” Toriola said.
Toriola conveyed a sense of optimism regarding the regulators' ability to make informed decisions, considering the actual conditions of the sector, despite the existing challenges. The CEO highlighted that the priority lies in securing the industry's long-term sustainability instead of merely pursuing short-term profits.
“I believe we’re all on the same side, the policymakers, the regulators, our Chairman of ALTON, Gbenga Adebayo, and the industry. We’re united because we share concerns about a few fundamental issues. First, human rights, are critical to driving any economy. Without a sustainable industry, the broader economy and the well-being of the people will be negatively impacted.”
The proposal arises in the context of increasing expenses for telecommunications companies, influenced by factors such as inflation, fluctuations in exchange rates, and the rising costs of essential operational inputs like diesel, electricity, and raw materials.
Toriola emphasized the strain these escalating costs have placed on telecom enterprises, complicating the ability of many firms to sustain profitable operations.
Earlier this week, operators released a statement indicating that service interruptions are likely unless tariffs are revised to reflect the growing operational expenses.
Engr. Gbenga Adebayo, Chairman of the Association of Licensed Telecommunications Operators of Nigeria, characterized the telecom industry as “under siege,” pointing to the surging operational costs resulting from inflation, unstable exchange rates, and increasing energy expenses.
He remarked that, in spite of these difficulties, tariffs have not been adjusted, leaving operators in a challenging position to provide quality service and expand their networks.
The telecom leader cautioned that without prompt tariff adjustments, operators might have to reduce services, resulting in limited access to telecom services in certain regions.
The initial request for a tariff adjustment was made in April 2024, yet no substantial progress has been made.
In light of the mounting financial pressures, ALTON and the Association of Telecommunications Companies of Nigeria jointly called on the Federal Government to initiate a productive dialogue with industry stakeholders.
The associations stressed the importance of establishing a framework that balances consumer affordability with the financial viability of operators, following 11 years of stable tariffs.
With a collective commitment to safeguarding the future of the sector, operators are urging all stakeholders to take action before it is too late, warning that inaction could jeopardize the survival of one of Nigeria’s most vital industries.