Telecom
Better Connected, Smarter Cities Attract more Investment
Blurb: With more than 40 percent of Africa’s population living in urban areas, Africa is embracing urbanization and the opportunities and challenges that come with it. Smarter cities are more capable of attracting FDI. For a country and its cells, “Cities”, there is also Maslow-like hierarchy of digital needs. Security assurance is the basic needs.
ICT has an important role to play in attracting capital and investment by increasing efficiency and cutting costs, not only for a country but also at a city-level. However, how closely is ICT and investment correlated to each other and what is the implications for Africa, home to most of the hundreds of millions of new city dwellers expected by 2050?
A report launched recently by UN Habitat (‘The State of African Cities 2018: The geography of African Investment’) explains how African cities can replicate those of East Asia and attract foreign direct investment (FDI) in order to develop sustainably.
The report shows Africa needs to seize a more prominent position in the world economy by enhancing its accessibility, connectivity, markets and urban attractiveness. It finds “reliable mobile networks and internet access attract knowledge-based FDI”.
As a leading company in the ICT industry, Huawei fully agrees with many of the report findings include that firstly, improving ICT infrastructure is critical to attracting FDI, whilst secondly, the ICT industry itself is also a crucial sector for FDI. For the latter finding, the report highlights that ICT sector FDI offers the highest growth rates and highest number of direct jobs along with manufacturing, and that the two are closely linked.
Connectivity provided by communications network and internet has become as important as water and electricity. The State of African Cities Report notes inward FDI into Africa correlates positively with large urban populations (markets), mobile phone subscriptions, internet bandwidth and full electricity supply, “These factors combined with high-quality ICT and lower transaction costs enhance FDI attraction for multinationals.” This parallels Huawei’s own experiences in Africa over the last twenty years.
A better ICT environment can better attract knowledge-based FDI. It starts with having reliable mobile networks and internet access. Internet access itself is not enough though. Huawei believes that in Africa connectivity brought by the network of communication towers and fibre is like the “soil”, which provides the fertile ground for important value-adding crops, which in this case are services including Safe City, E-government, E-education, E-health, E-agriculture and so on that enhance public social services delivery and better allocation of resources. We must keep improving the soil fertility, or the quality, access and speed of the connectivity, so the “crops” can grow successfully improving the ease of doing business and livelihoods.
With more than 40 percent of Africa’s population living in urban areas, Africa is embracing urbanization and the opportunities and challenges that come with it. On the one hand, African countries are gaining agglomeration and economy of scale benefits, but on the other hand they must manage “big city diseases” e.g. congestion, pollution, and even some non-traditional security threats such as financial security and terrorism.
The “smart city” concept is a new critical phenomenon in urban development, especially when cities want to expand their global reach. Smarter cities, according to the report’s studies, are more capable of attracting FDI from more and further destinations. City administrations can therefore set up Smart Procurement Agencies and Competition Commissions, for branding their city as an attractive “smart” investment destination.
How to make a city smarter?
First, construction of smart cities is a giant system that interacts across systems and is a “system of systems”. It requires coordination of cross-domain coordination through the top-level design, including setting goals, priorities, and implementation paths. The top-level design is also essential rather than optional given that cities are paying more attention to civic experiences, technological frameworks, new technology references, and construction models, In addition to projects and investments.
Second, taking a two-step approach starting with Safe City and then moving to Smart City. According to Maslow’s hierarchy of needs, safety and security together with food and water are basic needs for all human beings. For a country and its cells, “Cities”, there is also Maslow-like hierarchy of digital needs. Similarly, security assurance is the basic needs for a country or a city. It lays a solid foundation for a competitive nation and a dynamic city.
Third, to grow the nerve system inside and outside the body. Huawei sees a city as a living organism, which is powered by a nervous system comprises a “brain” (the control center) and “nerves” (the network and sensors). Leveraging leading new ICT such as cloud computing, IoT and AI, Huawei is committed to creating a strong nervous system that powers Smart Cities. More importantly, as the report finds, to establish a national, regional and international network of dedicated smart cities that collaborate and share beneficial information and data.
The report is well-timed and chimes with Huawei’s own experiences from our work across the world, including in African countries. With Huawei’s vision to bring digital to every person, home and organization for a fully connected, intelligent world, we fully support the recommendations in the report that local policy makers should embrace the digital revolution, develop ICT skills and invest more in regional infrastructure, both physical and ICT, to make our cities safer, our lives better and our future smarter.
Federal government has said it commence a $2 billion fibre network expansion project in the fourth quarter of 2025.
The initiative aims to enhance the country’s digital infrastructure, boost internet accessibility, and drive economic growth.
Under the project, an additional 90,000 kilometres of fibre optic cables will be deployed, expanding Nigeria’s existing network from 35,000 km to 125,000 km.
This expansion is expected to improve internet connectivity, increase broadband penetration to over 70%, and significantly reduce access costs by more than 60%.
Dr Bosun Tijani, minister of Communications, Innovation, and Digital Economy, stated that the Federal Executive Council had approved the creation of a special purpose vehicle to oversee the project’s implementation and funding.
The government will invest $1 billion directly, while the remaining funds will be sourced through loans and partnerships with organisations such as the World Bank.
This initiative aligns with Nigeria’s broader digital transformation agenda, reinforcing its commitment to becoming a leading digital economy in Africa.
Improved fibre optic infrastructure is expected to drive technological advancements, attract investment, and create job opportunities across various sectors.
By enhancing internet accessibility nationwide, the project will support Nigeria’s growing tech ecosystem, facilitate e-governance, and enable digital inclusion, particularly in underserved rural areas.
The government’s investment in broadband infrastructure is seen as a strategic move to position the country as a regional hub for digital innovation.
The launch of the fibre network project marks a significant step toward closing Nigeria’s digital divide, fostering economic development, and ensuring that more Nigerians have access to affordable, high-speed internet.
MTN Group has reported a 69 per cent decline in full-year earnings, citing the impact of Nigeria’s naira devaluation and operational difficulties in Sudan.
Karl Toriola, chief executive officer, MTN Nigeria
The company with headquarters in South Africa announced on Monday that its headline earnings per share—a key profitability measure fell sharply to 98 cents for the year ending December 31, down from 315 cents in 2023.
The financial downturn was largely attributed to Nigeria’s ongoing foreign exchange crisis, which has led to chronic dollar shortages and multiple currency devaluations.
In a bid to stabilize the naira and attract investment, the Central Bank of Nigeria implemented devaluation measures that significantly affected businesses operating in the country, including MTN.
Rising inflation and high interest rates further exacerbated the situation, increasing operational costs and contributing to the telecom giant’s financial slump.
MTN Nigeria, a key subsidiary of the group, bore the brunt of the economic turmoil. Its pre-tax loss surged by over 200 per cent, reaching N550.3bn ($355.76m).
In response, the company has initiated several measures aimed at restoring profitability, including renegotiating tower leases and implementing a tariff hike, which received regulatory approval in January.
Despite the challenging economic environment, Ralph Mupita, CEO, MTN Group said the company remains optimistic about the recovery prospects in Nigeria.
“That pain which we’ve had for 18 months is abating somewhat,” Mupita stated during a media briefing. “The business is growing very strongly. So, I’m actually very bullish and confident that we’ll see a strong recovery in Nigeria.”
Beyond Nigeria, MTN’s performance in Sudan was also hampered by the country’s ongoing armed conflict.
The unrest led to network impairments totalling 11.7bn rands ($643.40m), significantly affecting operations in the capital, Khartoum, where services had been down since April 2023.
However, the company has reported gradual improvements, with some sites being restored in previously conflict-ridden areas.
Despite the downturn, MTN’s overall group service revenue stood at 177.8bn rand, reflecting a 15 per cent decline.
However, in constant currency terms, the company noted a 14 per cent rise in service revenue, buoyed by growth in data, fintech, digital, and enterprise services, particularly in its home market of South Africa, where service revenue increased by 3.1 per cent.
To reassure investors, MTN declared a final dividend of 345 cents per share and projected a minimum dividend of 370 cents for the 2025 financial year.
While the company continues to navigate economic and geopolitical challenges across its markets, the management said it remains focused on strategic initiatives aimed at stabilizing its operations and ensuring long-term profitability.
The telecom giant said it is actively engaging with regulatory authorities, implementing cost-cutting measures, and leveraging its digital transformation strategy to drive revenue growth.
With confidence in Nigeria’s long-term market potential, MTN said it is optimistic about a turnaround despite the current headwinds.
Galaxy Backbone Limited (GBB), Nigeria’s foremost digital infrastructure and services provider, has unveiled a bold and comprehensive four-year strategic plan (2025-2028) aimed at accelerating the integrated digital transformation Strategy (IDTS) plan for government and businesses in Nigeria.
This strategy is designed to enhance digital service delivery, strengthen connectivity, and support Nigeria’s vision of a fully integrated digital economy.
Developed in collaboration with key stakeholders, the strategy focuses on five core pillars that will drive efficiency, innovation, and sustainability in Nigeria’s digital landscape.
The first focuses on building a Resilient Digital Infrastructure; ensuring that government and businesses have access to secure, high-speed, and scalable digital platforms. By building and maintaining a robust digital backbone, GBB aims to support the nation’s growing demand for seamless connectivity and data security.
The second pillar, Integrated Digital Ecosystems; fosters collaboration between government, businesses, and local communities, creating a more connected Nigeria. Through this initiative, GBB seeks to break silos and establish a unified digital experience that enhances communication, innovation, and service delivery.
To meet the evolving demands of governance and business, the strategy prioritizes Innovative Service Delivery; ensuring that digital solutions are tailored to address economic, social, and administrative needs. By leveraging cutting-edge technologies, GBB is committed to driving efficiency, economic growth, and improved public service delivery.
Now, recognizing the critical role of trust in the digital era, the fourth pillar of the strategy places a strong emphasis on Digital Leadership & Trust. GBB is dedicated to fostering a culture of cybersecurity, transparency, and accountability, ensuring that Nigeria’s digital infrastructure is not only efficient but also secure and reliable.
To sustain long-term impact, the fifth pillar, Financial Sustainability; remains a key priority. By investing in innovative technologies and expanding its digital services, GBB aims to drive revenue growth while ensuring affordability and accessibility for all users.
At its core, this strategic roadmap is designed to enhance government efficiency, boost economic development, and improve the overall digital experience for Nigerians. So, as part of its commitment to achieving these goals, GBB is actively engaging with government agencies, private sector players, and international and local partners to foster collaboration and accelerate implementation.
Through strategic partnerships, the organization is poised to lead Nigeria into a new era of digital excellence, ensuring that businesses and government institutions alike are equipped for the future.
Galaxy Backbone, through its IDTS plan, remains steadfast in its mission to drive Nigeria’s digital transformation through world-class infrastructure, secure connectivity, and innovative solutions that power progress.
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