Nigerian Labour Congress (NLC) Wednesday announced February 4, 2025, as the date to embark on a nationwide protest against the 50 percent telecommunications services tariff hike in the country.

Joe Ajaero, president, NLC,

NLC, disclosed this in a statement on Wednesday.

This comes as the Nigerian Communications Commission (NCC) on January 20, 2025, announced the approval for telecom companies to hike services tariffs by 50 percent.

The approval has sparked a wide tide of rejection by Nigerians, including the NLC.

In an update to press home their opposition against the telecom tariff hike, the NLC vowed to shut down the country through a nationwide protest.

This is part of its mobilisation against the planned 50 percent telecom tariff hike.

The nationwide protest was agreed on at the ongoing National Administrative Council (NAC), of the labour union.

The protest aims at sounding a note of warning to the government that workers would resist the planned hike as it would worsen the poverty level across the country.

NLC had, on January 22, rejected the 50 percent telecommunication tariffs hike approved by the Federal Government through NCC.

The NLC said that the 50 percent tariff hike approval, at a time Nigerian workers and the masses are grappling with unprecedented economic hardship, is a clear assault on their welfare and an abandonment of the people to corporate fat cats.

“This decision, coming at a time when Nigerian workers and the masses are grappling with unprecedented economic hardship, is a clear assault on their welfare and an abandonment of the people to corporate fat cats,” the statement by Joe Ajaero, president, NLC, partly reads.

The recent 50 percent increase in mobile tariff in Nigeria has been identified by the Global System for Mobile Communications Association (GSMA) as a major driver for investment, and the expansion of Nigeria’s 4G network.

A GSMA report on Wednesday, said the tariff adjustment is expected to unlock more than $150 million in fresh investment, pushing 4G coverage from 90 percent to 94 percent of the population and expanding mobile internet access to an estimated 9 million additional Nigerians.

“The increase in tariffs is projected to generate over $150 million in new investment, allowing for the extension of 4G coverage to 94 percent of the population.

“This will bring nearly nine million more people within reach of mobile internet, with close to two million expected to adopt the service, particularly in rural areas,” GSMA Intelligence stated.

GSMA emphasised that this development is a pivotal step in fortifying Nigeria’s telecom infrastructure and enhancing digital access.

The organisation projects that beyond network expansion, the influx of investment will have a ripple effect on the broader economy.

Enhanced mobile infrastructure and a surge in digital adoption are expected to drive Nigeria’s Gross Domestic Product (GDP) up by 2 percentage points by 2028, create nearly two million new jobs, and contribute an additional N1.6 trillion in tax revenue.

The expanded connectivity is also expected to spur advancements in emerging technologies such as Artificial Intelligence (AI) and the Internet of Things (IoT), with potential benefits for key sectors like agriculture, healthcare, and transportation.

Angela Wamola, head, Sub-Saharan Africa, GSMA, highlighted the critical role of the tariff adjustment in fostering long-term economic growth.

“This decision by the NCC is a game-changer for Nigeria’s digital landscape. By encouraging sustainable investment, we are not only improving service quality for consumers but also creating opportunities for innovation and economic expansion,” she noted.

However, Wamola underscored the need for complementary policy reforms to maximise the benefits of the tariff hike. “

To fully realise the potential of this policy, additional measures such as streamlining Right of Way permits, enforcing a Critical National Infrastructure plan, and alleviating the tax burden on the telecom sector must be prioritized,” she urged.

GSMA is pushing for regulatory improvements to accelerate digital penetration, citing success stories from Kenya and South Africa, where similar reforms have enhanced digital inclusion and economic growth. The organization reaffirmed its commitment to working with the Nigerian government and industry stakeholders to ensure the country fully leverages its digital potential.

Association of licensed Telecom Companies of Nigeria (ALTON), umbrella body of telecom operators in the country, has raised the alarm over the review of annual payment structure under the Financial Reporting Council Amendment Act 2023 (FRC Act), warning that its implementation will hurt telecom operators.

The group warned that “the new structure would pose significant challenges for our members, especially in light of the prevailing harsh economic conditions in the country”.

A letter addressed to Dr Rabiu Olowo, executive secretary/CEO, Financial Reporting Council of Nigeria, dated September 13, 2024 and jointly endorsed by Gbenga Adebayo, chairman, and Gbolahan Awonuga, executive secretary of ALTON respectively, highlighted the concern of the reviewed annual payment structure.

“ALTON writes to express its deep concerns regarding the recent review of the annual payment structure under the Financial Reporting Council Amendment Act 2023 (FRC Act) particularly as it relates to non-quoted public interest companies.

As you are aware, the new payment structure is based on a percentage of the annual turnover of our member companies, rather than the previous maximum cap of N1 million that was payable under the Act. Section 33(1)(d) of the Act now requires private companies to pay their annual dues based on the computation below: 0.02% of annual turnover of N25 million and below; 0.025% of annual turnover of more than N25 million but not more than N50 million; 0.03% of annual turnover of more than N50million but not more than N500 million; 0.04% of annual turnover of more than N500 million but not more than N1 billion; 0.045% of annual turnover of more than N1 billion but not more than N10 billion; and 0.05% of annual turnover of more than N10 billion.

“On the other hand, Section 33(1) (c) of the Act determines the annual dues payable by quoted companies with reference to a percentage of their market capitalization up to a pre-determined lower amount, which is more favourable to publicly quoted entities compared to the non-publicly quoted entities.  For example, a publicly quoted company with market capitalization of N1 trillion will be required to pay N25 million as annual dues, whilst a non-publicly quoted company will be required to pay 0.05 percent of N1 trillion amounting to N500million. We are concerned about the huge disparity in the amounts payable as annual fees by entities having the same turnover figure deserves to be addressed in the face of the harsh operating environment in the country.

“While we understand the rationale behind this review, we believe that implementing the new structure would pose significant challenges for our members, especially in light of the prevailing harsh economic conditions in the country. The telecommunications industry in Nigeria has been facing numerous headwinds, including rising operating costs and foreign exchange fluctuations. The current payment structure will place an undue burden on our members, potentially impacting their ability to maintain operations and continue providing critical services to the Nigerian public,” ALTON wrote.

The group noted that when considering the balance between enforcing the law and the need for Foreign Direct Investment (FDI), as well as the demand for bridging the telecom infrastructure deficit to enhance digital penetration, it urged the FRC to consider adopting alternative computation for companies within the telecommunications industry.

“We respectfully urge the FRC to consider the following suggestions as alternatives: Computation of annual dues based on profit and not revenue.

“By virtue of the nature of the telecommunications industry, our members deploy significant capital towards carrying out their operations and bridging the telecommunications gap within the country. As such, there is a great disparity between the revenue of these companies and the profit which they declare. For example, a company might have a turnover of N200 billion and declare a profit of only N15 billion and it would be unfair for such a company to pay FRC dues based on its revenue. We consequently request that the FRC uses its good office to consider computation of the annual dues for companies within the telecommunications industry, based on their profit as opposed to revenue,” ALTON suggested.

Another suggestion was the reintroduction of a pre-determined cap on the FRC dues.

“We note that the new Act in Section 33 (1)(c) computes the annual dues payable by public companies based on their market capitalization but subject to a pre-determined cap. For example, a public company with a market capitalization of N500 billion will either pay 0.0025% of this amount or N20 million, whichever is lower. On the other hand, a private company with the same revenue will pay N250 million. This disparity is significant and unfair to private companies. In the interest of fairness, we urge your good office to consider reintroducing a pre-determined cap on the dues payable by non- quoted public interest entities, similar to that which is applicable to public companies.

“In the light of the foregoing, ALTON respectfully request you to use your good office to change the basis of computing the annual dues payable based on either of the option mentioned above.   We are committed to working constructively with the FRC to find a mutually acceptable resolution to this matter. We would be more than willing to arrange a meeting with your office to discuss this issue in detail and explore alternative solutions or payment arrangements that would be more manageable for our member companies.

“We firmly believe that a collaborative approach would be in the best interest of the industry, the regulatory environment, and the overall economic well-being of the country,” ALTON stated.