MTN Nigeria has revealed that telecommunications companies are seeking a 100 per cent tariff increase, but it remains uncertain whether the Nigerian Communications Commission—the telecom regulator, will approve the proposal.
The disclosure was made by the Chief Executive Officer, MTN Nigeria, Karl Toriola, during an interview on Arise TV on Thursday, 2 January, 2024.
According to Toriola, the proposed tariff hike is necessary for the sustainability of the industry, which has been facing significant financial pressures due to rising operational costs.
“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.
Despite the challenges, Toriola expressed optimism that regulators would make the right decision, taking into account the realities of the sector.
The CEO emphasised that the focus is on ensuring the long-term sustainability of the industry, rather than short-term profitability.
“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 comes amid rising costs for telecom companies, driven by factors such as inflation, exchange rate fluctuations, and the increasing price of key operational inputs like diesel, power generation, and raw materials.
Toriola highlighted the pressure these rising costs have put on telecom businesses, making it difficult for many companies to maintain profitable operations.
Earlier this week, operators issued a statement warning that service disruptions are imminent unless tariffs are adjusted to account for escalating operational costs.
The Chairman of the Association of Licensed Telecommunications Operators of Nigeria, Engr. Gbenga Adebayo described the telecom sector as “under siege,” citing soaring operational costs driven by inflation, volatile exchange rates, and rising energy prices.
He noted that despite these challenges, tariffs have remained unchanged, leaving operators struggling to maintain quality service and expand their networks.
The telcom chief warned that without an immediate tariff adjustment, operators may resort to service shedding, leading to limited availability of telecom services in certain areas.
The first call for a tariff adjustment was made in April 2024, but no significant progress has been achieved.
In response to the growing financial strain, ALTON and the Association of Telecommunications Companies of Nigeria issued a joint statement urging the Federal Government to facilitate a constructive dialogue with industry stakeholders.
The associations emphasised the need for a framework that balances consumer affordability with operators’ financial sustainability, following 11 years of tariff stability.
With a shared commitment to preserving the sector’s future, operators are calling on all stakeholders to act before it’s too late, warning that failure to do so will risk the survival of one of Nigeria’s most critical industries.
Source: The Punch Online
