Nigeria Spends Over $2 Billion on Foreign ICT Contents Yearly

Nigeria’s Information and Communication sector spent $2.16 billion per year on foreign licence renewals, foreign management fees, foreign managed services and other miscellaneous fees, stated Prof. Olalekan Sakariyau, the Head of Entrepreneurship and e-business, Federal University of Technology, Minna.

Sakariyau said this on the back of a report published by the Association of Telecommunications Companies of Nigeria (ATCON). He also advocated for the stoppage of foreign patronage and encourage local production of software in order to stop capital flight and support local talents.

Breaking down foreign exchange spent on foreign licence renewals and other technology-related acquisitions, he said the capital expenditure accounted for $750 million of the total foreign spending, while Network Software Licensing stood at around $250 million. Management Fees, Managed Services and Miscellaneous Fees (including international circuits, roaming and terminations reconciliations) were estimated at $800 million, $157 million and $200 million.

Sakariyau further stated that 77 percent of all the software in use in Nigeria are developed in foreign countries, with a meagre of 23 percent developed locally. The same goes for Hardware with an estimated 86 percent coming from foreign sources, leaving only 14 percent for local companies.

According to Sakariyau statistics drawn from the ATCON report, Base Transceiver Stations (BTS) in the country are mostly dominated by foreign influence, with 88 percent being foreign and a mere 12 percent manufactured by local companies.

The implication of these statistics is that Nigeria’s unhealthy reliance on foreign products will continue to drag on the local market, plunge new job creation, and hurt household income. With such a wide gulf in the usage of foreign and local IT sources, a hiccup in the supply of those products by the foreign sources may leave the country scrambling to either find local products or get accustomed to them when found.

Sakariyau spoke at the Emerging Technologies Research and ICT Innovation Exhibition/Competition, on the topic: ‘The National Strategy for Promotion of Indigenous Contents in the Telecom Sector’. He spoke on the need to boost the promotion of digital manufacturing, software development and research and development for digital innovation in the country.