October 25, 2022

How we turned Ministry of C&DE into Nigeria’s highest GDP earner — Prof Pantami

How we turned Ministry of C&DE into Nigeria’s highest GDP earner — Prof Pantami


Professor Isa Ali Pantami can rightly be described as an authority as far as Information and Communication Technology is involved. He has demonstrated his vast knowledge and capacity in that field of knowledge through sound policies and programmes he has succinctly fashioned and implemented as the first minister of Communications and Digital Economy in Nigeria, bringing unprecedented transformation and revenue to the sector and drawing applause and admiration from Nigeria and the international community through his revolutionary work from 2019 when President Muhammadu Buhari named him to that position.

Because of Pantami’s outstanding innovations and strategies, the Ministry of Communication and Digital Economy has replaced oil and gas as the highest GDP contributor in the country for some years running and it is not about to abate given new actions being undertaken by the sector.

In this interview with Northern Region Editor, Soni Daniel, Abuja Bureau Chief, Emma Ujah and Technology Correspondent, Emma Elebeke, Pantami speaks on the reforms that brought about a new dynamism in the sector and made it Nigeria’s highest GDP earner.  Excerpts:

WHAT has really changed from the former Ministry of Communications to the current Ministry of Communications and Digital Economy which you head as the pioneer minister?

 Firstly, as you rightly said, it was Ministry of Communications before 17th October 2019 when Mr. President approved our proposal for renaming and redesignating the ministry as Federal Ministry of Communications and Digital Economy. The reasons that motivated us to rename it are many, but I will mention only a few of them. Number one, is to be in alignment with the global best practices. Global best practices based on the recommendations of international organisations like the International Telecommunications Union, ITU, and to a certain extent the World Economic Forum, which is to focus on the creation of virtual wall that we witness today. We have three walls: the physical, biological and virtual.

Because of that virtual wall, the new focus is on digital economy rather than just communications. Prior to the re-designation of this ministry, many other developed countries had either ministry of digital economy or a parastatal managing digital economy. The second reason was to change the perception of our citizens. Prior to the re-designating the ministry, nobody was talking about ministry of communications when it comes to economic development. Citizens were only considering oil and gas, agriculture and few other things because the perception we inherited was that ICT was for socialisation.

That is why we needed to do something to change the perception of our people from thinking that ICT is only a tool for socialisation. We needed to prove to all that ICT can add real value to the economy of Nigeria and become a tool for integration and national development. So, we changed the name of the ministry to support the government in economic diversification.  At that time, the economic contribution to our GDP was not significant, but by the time we changed it to digital economy in 2020, we set a new record of contributing 14.70% to our GDP. That time, it was unprecedented.  In 2021, Q2, 2021 we contributed 17.92%, which was unprecedented again. We set a new record after the first one. This year, based on recent report released by the NBS, in the Quarter of 2022, the ICT sector alone contributed an unprecedented 18.44% to the economy. We set new record of contribution to the economy each year and I believe that in the coming year, we will break another record. This is what digital economy is all about. Today, we have about seven UNICONs in Africa (small IT company that has a market value of a minimum of $1m market value), five out of these seven, their root is from Nigeria. They originated from Nigeria. So, if you look at communications alone, it does not convey any message of economic development but it is just to communicate with mobile phone and postal services; but digital economy is beyond that. Communication, if you mention it, does not have any definition; but if you add digital economy with these three words: communication, digital (which adjective describing the third one), economy.

The first one is the channel, while the second one is the content passing through the channel (the digital content), while the third one is the target you want to achieve. So, we use communication to pass digital content to develop our economy. This is the relation between the three words. Then, number three is economic diversification. When this administration came on board, we were complaining about recession. We brought about digital economy to diversify the economy from oil and gas. In the Q2 2022, oil and gas contributed less than 7%, but digital economy brought in 18.44% from the ICT sub-sector only. The digital segment was not added because part of it is added to the financial sector because digital economy is ICT sector plus digital services. If you add ICT sector alone plus digital services, that will give you digital economy. So, if the contribution of digital services is added to the overall contribution of the digital economy, it will be mindboggling

With these services, Nigeria must have earned a special position within the African continent. In terms of digital economy, how strong is the Nigerian economy compared to other African countries?

With all sense of humility, we are leading Africa in digital economy. It was only in July I was in Algiers in Algeria, for African Telecommunication Union, ATU event. Usually, during the conference, the minister of the hosting country is statutorily the chairman of the conference, but the minister of ICT of Algeria was appointed as the chairman statutorily. But prior to my arrival, all my colleague ministers unanimously agreed that the Minister of Nigeria should be the chairman unopposed, without presenting my candidature for contest.  When I asked why, they said “your candidature was presented and we elected you in recognition of what you have been doing.” So, I was appointed chair prior to my arrival by 54 African ministers and I served as Vice Chair. I coordinated even very difficult sessions where many candidates looking for the post of the Secretary General of ATU; and through consensus, I was able to manage this and we presented one candidate from Kenya to continue with second term because he had served the first term. And most of my colleagues have been asking which magic I have been doing in Nigeria to bring about the revolution we are witnessing in the digital economy of our country. Even yesterday, some stakeholders were here, saying that some years ago, they started the process of auctioning and deploying 5G, which took them eight years, but look at what we did here in Nigeria, from start to finish. Secondly, to appreciate our contribution, I was appointed through the ITU as the Chairman of the World Summit on Information Society, 2022, which is the first time anybody from this part of the world was considered for that position. I was appointed unopposed. I am currently the chairman World Information Society and chairing 193 global ministers of ICT from Europe, America, North and South America, Asia and other parts of the world.  Given the explanations you have made, what would you say is the real worth of the digital economy in Nigeria in terms of Naira and Kobo.

 To be fair, it is only now that we are in the process of compiling that. We have established the baseline between when we came in and we are now trying to re-evaluate the entire value of the sector because it is very big. Even in developed countries where everything is automated, it is still difficult to come up with specific value. But it we can come up with the value in terms of broadband penetration, digital skills, foreign direct investment, contribution to the gross domestic product, VAT remittances to government. When I came on board, there were many leakages.

The FIRS confirmed early this year that MTN alone remitted 13.5 percent of the VAT collected in Nigeria. This is because we deployed technology to block leakages.  Before then VAT was collected based on the account books of the companies without adding any system to monitor whether the account book is in alignment with reality or not. If you want to get the full picture, agriculture a major contributor to the economy contributed only 22% to our GDP. We contributed 18.44%, but remittances of VAT from agriculture was less than N2 billion in the Q1 2022, and in Q2 2022 we remitted over N136 billion.

 But you recently opposed the introduction of 5% telecoms tax which was to be imposed on the telcos. What informed your decision at a time the country is desperately looking for money to boost the economy?

Obviously, every country depends on resources to be able to implement projects, and the more resources the better. However, this is my philosophy: I do not believe that you should kill the goose that lays the golden egg. We are a sector that, as I have explained earlier, has sustained the economy of Nigeria. This is a sector that has employed millions of people and remitted significant resources to national coffers through taxes and VAT. Recently, with the auctioning of the 5G spectrum, we were able to raise over $500 million for the country. So why do you leave sectors that are not contributing as much to the economy and target sectors that are contributing more when targeting them the way we are doing can stifle their growth and contribution to the economy. 

So, yes, we want more money, but I believe that it is right to encourage and support sectors that are already doing well and not burden them with more taxes that can stifle their growth. And like I have been saying in the past, it is important that sectors that are not yet contributing to the economy like they should, be encouraged and motivated to generate more resources.  This is a more pragmatic approach that over-burdening sectors that are already contributing as this can stop them from producing as much as they currently do for the economy.

Now what are you doing to promote indigenous players in the sector?

 We are doing something and it will soon show to the world. In May 2020, Mr. President launched the National Policy for the Development of Indigenous Content in the Telecommunication Sector, which we developed. It is a policy that was not there before. Just last week Mr. President formally signed into law the Nigeria Startup Bill, an Executive Bill we initiated by organic approach, which is meant to allow young Nigerian young innovators to start their projects and programmes in the ICT sector and address at least 90 per cent of the challenges currently being encountered by them. How is Nigeria coping with the threat posed by hackers and scammers who are out to compromise sensitive data of national institutions and individuals?

When you have digital technologies, you have the advantage of being able to connect and do things seamlessly. Unfortunately, this also comes with additional challenges such as cybercrime, which became even more pronounced as a result of the COVID-19 pandemic. We therefore have a responsibility to protect ourselves from cybercrime. Some of the things we have done include the following:  We have emphasized the importance of cybersecurity. Cybersecurity prepares people to be able to overcome, prevent or be resilient to cybercrime.

We are promoting cybersecurity, and as a matter of fact, October is our cybersecurity awareness month when we make sure that citizens are able to increase their knowledge on how to protect themselves in cyberspace. We are also conducting trainings through parastatals under the supervision of the Ministry such as NITDA, NCC and NIMC to ensure that people are safe online. In addition, we have made arrangements to ensure that there are Computer Emergency Readiness and Response Team, CERRT, for different sectors. We have one in the Information Technology sector that is managed by NITDA, and their responsibility is to discover threats and prevent them, and also provide information to relevant organisations in the sector so as to prevent such threats and recover from them when they occur.  When I became the Minister of Communications and Digital Economy, I made sure that a Computer Security Incident Response Team, CSIRT, was created for the telecommunications sector because that is a very vital sector as well. We are also doing similar things in the NIMC, and outside the Ministry, things are being done in the financial sector through CBN, as well as Immigration to ensure that it is not easy for hackers, scammers and cybercriminals to have a field day. 

These efforts are in line with Pillar #6 of the National Digital Economy Policy and Strategy, NDEPS, for a Digital Nigeria which focuses on Soft Infrastructure. The whole idea is to make sure that the citizens feel safe and secure when using digital technologies.  In addition to this, we have ensured that every SIM in Nigeria is linked to a National Identification Number, SIM, and this has helped to streamline access to these devices, and it is now possible to identify people that own these devices, making it easier to reduce cybercrime.

Despite the introduction of 4G and 5G networks in Nigeria Internet services and voice calls still remain poor. What is the problem and when will this challenge be overcome?

I will like to point out that 5G was just recently introduced, and the commercial launch was just a few weeks ago. There has been a lot of progress in terms of expansion of 4G networks in the country. For example, when I assumed office a little over three years ago, there were just 13,823 4G base stations, now we have 36,751, which is 165.86% increase. This percentage increase of 4G coverage across the country also increased from 23% coverage to 77.52%. So yes, you might say that there are challenges, but it is only fair to acknowledge the significant progress that has been made. A lot of progress has been made in this regard. The directives that I have given to NCC are to ensure that they keep the telcos on their toes to ensure that the service keeps getting improved. With the 5G networks that have been launched and spreading across the country, we are sure to get even better service. Yes, there are still some challenges no doubt, but there has been a lot of positive change with regard to 4G and 5G networks and connectivity in the country. 

How realistic is the 70% broadband penetration target?

I believe it is very much realistic. We set out to do this in 2020 and our target is to get it done by 2025. I already mentioned that we have already exceeded some of the targets the NNBP set out to achieve.

In the area of broadband connectivity, I believe that we are well on target to achieve what we have proposed and even probably exceed it, because right now we have broadband of 44.65%, this means we have roughly around 25% to go over the next two years and some months. We are doing a lot to achieve this, we are rolling out fibre, we are encouraging companies to deploy infrastructure in rural and underserved areas and we are partnering with organisations to enhance connectivity.

Recently we gave out license to Starlink, and when they deploy, it will further enhance our broadband penetration. I believe that we are very well on course and achieve what we set out to do.

What legacies do you want to leave behind as the pioneer minister of DE?

I feel very privileged, honoured, and humbled to have been selected for this post and to be the first Minister of Communications and Digital Economy. You know before we were known as the Ministry of Communications, and then when I assumed office, I proposed to Mr. President for the name to be changed to Ministry of Communications and Digital Economy, in line with global best practice and Mr. President graciously approved our request, and the FEC endorsed this change. In terms of legacy, I will mention a few areas.

The first one is that we have developed a Digital Economy sector that plays a key role in supporting the traditional economy in many ways.  You will recall that as a result of the Covid-19 pandemic, a number of countries entered recession and Nigeria was one of such countries. 

Experts predicted that Nigeria would exit recession at the end of 2021, but because of the growth of the ICT sector, which is part of the Digital Economy Sector, the growth rate of 14.70% in the fourth quarter of 2020 helped the country to exit recession one year earlier than predicted. It is noteworthy that when the ICT sector grew at the rate of 14.70%, it was actually the fastest-growing sector and the only sector that grew by double digits.

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