Mobile Week with GSM

August 9, 2009

[email protected] : We’ll sustain FDI in telecom – Ndukwe

By Prince Osuagwu

As Global System for Mobile Communications GSM, clocks eight in Nigeria, the Executive Vice Chairman, EVC of the  country’s Chief telecom regulator, the Nigerian Communications Commission, NCC, Engr. Ernest Ndukwe at the weekend  allayed fears of any possible hamper of continued streams of Foreign Direct Investment into the country courtesy of  the telecommunications industry.

Ndukwe said that despite pockets of distractions which is not peculiar to Nigeria alone, the industry was well  positioned to sustain the stream of foreign Direct Investments it had always engendered in the aggregate Nigerian  economy.

He however admitted that though Nigeria may not be insulated from the ravaging global economic meltdown, but that  with proactive government policies, good regulation which the commission has always provided and enabling business  environment, the country would continue to be the toast of foreign investors particularly in the areas of ICT.
Speaking at a world press conference to mark the end of this year’s Nigerian Information Technology&  Telecommunications Exhibition, NITEX, hosted by the Nigerian Telecom news in Lagos, Ndukwe said his commission was  even championing a lot of policy and regulatory reformations including a review of the current interconnect rates to  ensure that telecom players in Nigeria enjoyed a favourable business atmosphere.

Ernest Ndukwe, NCC, EVC.

Ernest Ndukwe, NCC, EVC.

This is even as he revealed the commission’s plans to champion the cause of fibre without borders among African  countries, as a way of forestalling the effects of the recent SAT3 cable cut at the Benin Republic axis.
Ndukwe noted that the lesson to learn from the recent SAT3 cut was that no country is sufficient on its own and  therefore promised that he was going to raise the consciousness of interdep-endence among African countries with the  Fibre without borders campaign.

“Fibre is much more better in providing capacity, allowing for very robust telecom infrastructure. That is why I am  advocating fibre without borders among African nations. For instance with the recent SAT3 cable cut and the  attendant frustrations, it is obvious to everybody that no country is self sufficient on its own. When a thing like  that happens, there should also be a link where subscribers would be evacuated to, as a way of cushioning the  effects, because actually the ship that repairs such damages, takes a while to arrive. If there were borderless  fibre links amongst African countries it would have been easy to switch users and perhaps nobody would feel the  effect of the cut until the repairs are finally effected. My plan is to develop the issue of the Fibre without  borders into a term paper and circulate it among my colleagues and I am sure it would raise the right consciousness”  Ndukwe said.

The telecom industry, aided by GSM operations have actually boosted the country’s economy with investments worth  over $50m and providing Foreign Direct Investments valued at well over $12 million in eight years. Also, the GSM  operators, leading the pack of telecom operations have contributed to improved employment opportunities. At least up  to 15 000 persons are said to have been directly employed by different operating companies in Nigeria, within the  period under review, while several of other thousand Nigerians are benefiting from indirect employment generated by  the operators.

These growth indices have also brought about regulatory reformations. Today colocation and infrastructure sharing is  possible, with the licensing of Infrastructure sharing companies. Number portability is in the offing and operators  are rated quarterly on the basis of quality of their services. This is even as telephone connections keep soaring,  pitching at about 68 million by July 2009.
For Ndukwe, these high investment levels have been attained because Nigeria has become one of the most desired  investment destinations for ICT in Africa due to liberalisation, market potential, stable policy and regulatory  regime.

However he was quick to admit that even in liberalised environment, government still has a vital role to play in  growing the nation’s telecommunications infrastructure and ensuring a competitive environment that would reduce  prices and make services more acceptable.

Part of this ways, included allowing the regulator, a free hand to operate. “The Regulator, in an open liberalized  market draws its relevance from the widely accepted role of the State as a motivator and impartial umpire. This role  is typically very demanding and encompasses far-reaching and multi-disciplinary issues. To be successful, the  function should be based upon a well defined set of objectives.  These objectives must cover virtually every aspect  of telecommunications network and service provision including tariff, technical standards, allocation of scarce  resources, fair competition, and the regulation and mediation of inter-operator issues such as interconnectivity and  interconnect termination rates”.

Yet he gave tips on key Success factors for the regulator, capable of making any regulator achieve even more than  the NCC had done at the moment.

Enabling Laws

The foundation for a successful regulatory environment is the enabling laws, which must be such that the Regulatory  body has the statutory powers to function effectively.  Good regulation is essential to ensure the success of sector  reforms.

Government Support

The second important factor is the divestment of Government from ownership of telecommunications operating entities.   Governments will be more inclined to introduce significant competition in the market and strengthen the regulatory  institution if they do not also double as owners of telecommunications operators.


Experience has shown that the independence of the Regulatory body is essential to the successful perfor-mance of its  role in the sector.  Regulators need to be isolated from political or administrative pressures to be able to  regulate the market fairly and earn the confidence of investors, consumers and stakeholders.


The Regulatory body should be staffed with requisite trained professional
personnel in the legal, technical, financial, economic and general management
areas.  The personnel should be adequately remunerated and be granted terms of  employment which guarantee them  minimum level of independence in the discharge of their functions.


Without adequate funding a Regulatory body will not be effective.  Some Regulators are funded from Government  appropriations while others are funded by revenues from licenses and spectrum fees.  The latter is generally  preferred as it helps guarantee the independence of the Regulator and ensure that the regulatory function is not  cash strapped, and therefore unable to carry out its mandated functions.


All sectoral stakeholders must be given the oppor-tunity to comment or make their case concerning a major decision  that impacts them before a decision is taken.

Regulatory Decisions

In carrying out regulatory decisions, the key regulatory principles to be adopted are transparency, objectivity,  professionalism, efficiency and fairness.
Once these principles have been applied, the Regulators must be bold to make timely decisions.


Licensing criteria must be well articulated and publicly available, and the terms and conditions of individual  licenses must be investor friendly and also ensure consumer rights.


The regulatory environ-ment should be such that the NRA guarantees new entrants seamless intercon-nection with the  incumbents and dominant operators. Technical standards and specifications, rates and quality must be on  non-discriminatory basis, and interconnection must be assured on a timely, transparent and reasonable manner.

Finally, the NRA must ensure that the interconnecting parties have access to quick and independent dispute  resolution.

Consumer Protection

It is essential that consumer’s are effectively protected from any form of
exploitative behaviour by the operating companies and service providers.  The
Regulatory agency must therefore ensure that subsisting legal and regulatory frameworks support the rights of the  consumers. To that effect, NCC mandates operators to publish their Consumer Codes of Practice, which clearly state  the rights of their consumers, the services being offered, the channels for lodging complaints etc.