According to experts, the significant increase recorded in 2020 happened during the lockdown period because people relied more on digital platforms. The contribution of the Nigerian Information and Communication Technology (ICT) sector to the Gross Domestic Product (GDP) declined to the lowest in four years in 2021, due to national identification number (NIN) registration and sim card linkage.
According to the 2021 full year GDP report released today by the National Bureau of Statistics (NBS), the sector saw a decline in growth at 6.55 in 2021 compared to the preceding years where it recorded 9.65, 11.08, and 13.18 percent, respectively. According to experts, the significant increase recorded in 2020 happened during the lockdown period because people relied more on digital platforms.
While other sectors are beginning to come out of the effects of the Covid-19 pandemic, the ICT is yet to fully recover to hit its three years bullish performance where it recorded a steady growth rate. Since 2018, the sector’s yearly percentage of total GDP has remained relatively consistent.
“The Covid-19 pandemic resulted in general reduction in economic activities and this one way or the other affected the sectors of the economy. Also, the needed expansion of all networks that was planned failed to be executed as a result of the pandemic and the lack of access to forex in Nigeria,” Ike Nnamani, Chairman ATCON, told BusinessDay.
Prior to the release of the recent data by NBS, the Federal Government disclosed in its ‘Nigeria Medium-Term National Development Plan 2021-2025: Volume II.’ that it plans to increase the contribution of the ICT sector to GDP from 14 percent to 30 percent by 2025. However, one year down the period under review, and the figures do not look promising.
Aside from the result brought about by the pandemic in 2021, another major reason attributed to the low rate recorded is the NIN registration and SIM card linkage which the government imposed a ban on new SIM card registration in December 2020.
This was to verify and ensure compliance by Mobile Network Operators with the set quality standards and requirements of SIM Card registration as issued by the Federal Ministry of Communications and Digital Economy and the Commission. Despite the fading impact of the Federal Government’s policy that temporarily banned the sale and activation of new SIM cards, the sector is yet to recover from the initial huge effect.
“The NIN registration and linking of SIM cards also affected the ability to sign on new customers on various networks, as well as those with faulty or missing SIM cards reactivated in a timely manner,” Nnamani said. While experts in the sector envisaged that the ban may affect the economy, Isa Ali Pantami, Minister of Communications and Digital Economy explained the need for the ban as being necessary to address the issue of security, insisting that SIM registration carried out in the past compromised the system.