There is no disputing the fact that the ICT sector in Nigeria, has witnessed exponential growth, as it continues to grow in leaps and bounds.
Nigeria currently accounts for 82 percent of Africa’s Information and Communications market. The sector ranked as the most capitalized sector on the Nigerian Exchange (NGX) last month (August), with an N11.74 trillion aggregate market.
It gained N4.12 trillion in the first eight months of 2022, to share at N11.74 trillion, an increase from N7.62 trillion recorded as of ten listed companies. The sector which comprises four activities such as; Sound Recording, Motion Picture, Music Production, and Broadcasting, accounted for 18.4% of the nation’s economy, which was largely due to the growth of the telecommunications sector.
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The sector also recorded a 6.5% year-on-year real GDP growth in the second quarter of the year, compared to the 5.56% growth recorded in the corresponding period of 2021. Similarly, on a quarter-on-quarter basis, the ICT sector grew by 13.41% in real terms.
The sector comprises ten listed companies, although only two of them are household names, as they are the biggest telecommunications company in the country, which are MTN Nigeria and Airtel Africa. From the inception of GSM services rollout in 2001 up till 2022, telecoms contribution to the country’s GDP is over $70 billion.
The telecommunication sector, which is a component of the broader ICT sector grew significantly to N2.25 trillion in Q1 2022 from N1.96 trillion recorded in the corresponding period of 2021.
The significant gain recorded by the sector is largely due to the N4.08 trillion gain in the market valuation of Airtel Africa, having overtaken the likes of Dangote Cement and MTN Nigerian in January 2022 to become the largest company listed on the stock market.
The two telecoms giants posted impressive results in their finances in the first quarter of 2022. MTN Nigeria reported a 22.23% growth in revenue to the tune of N470.98 billion, with operating profit rising by 34.72% to N179.33 billion.
Airtel maintained the position as the most valuable company listed in the local bourse with a market capitalization of N7.7 trillion, gaining over N4.08 trillion between January and August 2022, bringing the total stock market value to over N26 trillion.
The impressive contributions of information and communications technology (ICT) to Nigeria’s GDP, is gradually transforming the country from a traditional economy, into one of Africa’s leading digital economies.
Due to the massive growth of the sector, it has made Nigeria one of Africa’s largest ICT markets in terms of its share of telecom subscribers and internet users. The ICT sector has no doubt continued to remain a critical driver of non-oil growth and a significant contributor to Nigeria’s GDP.
The sector has also been an enabler for digitalization and the development of other key sectors such as Agriculture, Education, Manufacturing, and Healthcare.