The analysts at Cardinal Stone have made optimistic projections for the Information and Communication Technology (ICT) sector, foreseeing sustained traction in 2024.
This positive outlook is attributed to the increased investments from telecom players who continue to exhibit aggressiveness in enhancing network coverage, technology infrastructure, and overall service quality.
The ongoing commitment of telecom companies to fortify their presence in the ICT landscape is expected to fuel innovation, foster technological advancements, and ultimately contribute to the sector’s robust growth.
However, the ICT sector expanded in real terms by 6.69 per cent (year-on-year) in the third quarter (Q3) of 2023, the lowest in five years, Nigeria’s GDP report stated.
The slowdown is a result of lower capital expenditure or capital expense (CAPEX) intensity by major telecommunication players, according to analysts at Cardinal Stone Research.
In addition, rising inflation dampened consumer spending capacity and might have led to weaker trade sector growth.
These factors eroded last year’s growth in the telecom sectors, however, Cardinal Stone analysts are optimistic that the sector will grow this year.
In the report on “Sailing Through Troubled Water”, on the outlook for Nigeria’s telecom sector, it said “We expect accretive benefits from higher subscribers as demand for data and voice continues to soar.
they anticipate accretive benefits from higher subscribers as the demand for data and voice services continues to rise.
Major telecommunication operators, including MTN, Airtel, and Globacom, witnessed significant increases in internet subscribers from January to August 2023.
However, 9mobile experienced a decline of 451,000 subscribers during the same period, according to data from the Nigeria Communication Commission (NCC).
The report also highlights the positive impact of the growing e-commerce market, valued at $6.8 billion in 2022 with an average growth rate of 11.0 percent over the last three years.
The expanding e-commerce segment is seen as beneficial for the trade sector and Fast-Moving Consumer Goods (FMCG) sales.
“We see legroom for additional gains from the growing e-commerce sector, aided by technological advancement, widespread internet accessibility, and a young, tech-savvy population,” the report said.
