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In a significant development, the Information and Communication Technology (ICT) sector emerged as the second-highest contributor to Nigeria’s real Gross Domestic Product (GDP) in the second quarter of 2023, accounting for an impressive 19.54% of the total. This substantial contribution underscores the growing importance of ICT in the country’s economic landscape.
The National Bureau of Statistics (NBS) reported this noteworthy achievement, positioning the ICT sector just behind the agriculture sector, which held the top spot with a contribution of approximately 21.1% during the same period.
According to the NBS data, the ICT sector exhibited robust performance, with an 18.44% year-on-year growth rate and a 17.47% quarter-on-quarter growth rate. In contrast, Nigeria’s overall GDP experienced a growth rate of 2.51% in the second quarter of 2023, reflecting a decrease from the 3.54% recorded during the corresponding quarter the previous year.
While the higher contribution of the ICT sector to GDP indicates increased economic activities within the sector, it is essential to note that this does not directly translate into substantial government revenue. Abubakar Abdullahi, an economics professor at Usmanu Danfodiyo University in Sokoto, emphasized that transactions within the ICT sector are often small and informal, posing challenges for proper documentation and taxation. As a result, the Nigerian government may not be realizing the full revenue potential from the ICT sector.
The NBS methodology defines the ICT sector as encompassing four key activities: telecommunications and information services, publishing, motion picture, sound recording, and music production, as well as broadcasting.
Notably, the telecommunications sub-sector played a pivotal role in driving the robust performance of the ICT sector. This sub-sector is primarily dominated by key mobile network operators, including MTN, Globacom, Airtel, 9mobile, and various Internet Service Providers.
As of July 2022, MTN emerged as the dominant force in Nigeria’s telecom market, boasting over 79 million subscribers, representing 38.36% of the market share. Airtel closely followed with approximately 58 million subscribers (28.21%), while Globacom commanded a significant share with over 56 million subscribers (27.28%), and 9Mobile secured 12.6 million subscribers (6.14%).
Sheriffdeen Tella, a professor of economics at Olabisi Onabanjo University, Ago-Iwoye, highlighted that Nigeria’s ICT sector has experienced substantial growth over the past two decades. The widespread use of mobile phones for internet access and various tasks has played a pivotal role in driving this growth, not only in Nigeria but globally.
Nigeria’s impressive ICT sector performance is further underscored by its status as the largest ICT market in Africa. The country accounts for a staggering 82% of the continent’s telecom subscribers and 29% of internet usage, making it a significant player on the African ICT stage, as noted by the International Trade Administration.
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