… Sector’s growth hinges on decisive government intervention — Rudman
By Juliet Umeh

Industry stakeholders have warned that inconsistent policies, regulatory bottlenecks, and multiple taxation are slowing growth in Nigeria’s digital infrastructure sector. Experts say decisive government action is critical to unlocking the country’s full potential as a leading digital economy in Africa.

The concerns were highlighted during an interactive session at a media capacity-building programme that brought together industry leaders and journalists to discuss the future of connectivity, data centres, and digital infrastructure across the continent. Participants included West Africa Bureau Chief at CNBC, Tayo Fagbule; Chief Executive Officer of the Internet Exchange Point of Nigeria, Muhammed Rudman; and Head of Converged Digital Infrastructure Africa at Open Access Data Centres, Obinna Adumike.

Speaking during the discussion, Rudman described the issue as complex, noting that Nigeria’s digital ecosystem depends on multiple components such as connectivity infrastructure, data centres, electricity supply, and supportive regulatory policies.

He said government remains the most critical stakeholder in resolving structural barriers affecting the sector. “To be honest with you, this is a multi-national problem and there is no single solution,” Rudman said. “But government is the critical stakeholder that can enable the ecosystem because the industry has many parts. You need connectivity, data centres, electricity, and regulatory support.”

He explained that the high cost of interconnection across Nigeria remains a major challenge, largely due to regulatory issues, right-of-way charges, and other bureaucratic hurdles. “Interconnectivity within Nigeria is extremely expensive, and it boils down to multiple factors including right-of-way and other regulatory challenges,” he said.

Rudman emphasised that addressing these issues requires deliberate government intervention, including policies that encourage large-scale fibre deployment nationwide. He noted that initiatives aimed at expanding national fibre networks could help close connectivity gaps and reduce the cost of internet services.

Industry players also stressed the importance of policies that promote local hosting of digital content and encourage investments in data centres. Rudman said government institutions must lead by example by ensuring that their digital platforms and services are hosted locally. “Government needs to lead the way in ensuring that their websites and services are domesticated. That will help increase local traffic and support the digital ecosystem,” he added.

Beyond infrastructure challenges, experts identified bureaucratic processes and regulatory overlaps as major deterrents to investors. Rudman cited instances where essential telecom equipment became trapped in administrative processes, creating delays for companies attempting to expand their services. “Recently we ordered equipment such as transceivers and computers, and they were held for clearance. We were asked to provide several documents even when the specifications were already clear,” he explained.

He also pointed to multiple taxation across federal, state, and local levels, noting that routine business operations could attract unexpected levies. “Sometimes a company vehicle can be stopped by local authorities demanding certain payments. These create an unfriendly business environment,” Rudman said.
For investors, policy stability and regulatory clarity remain critical factors when committing capital.

Despite the challenges, stakeholders agreed that Nigeria still holds significant advantages due to its large population and growing internet usage. Rudman noted, “We are far ahead of many countries in terms of data consumption and market size.”

He also highlighted the progress of IXPN, which has significantly increased local internet traffic and attracted global technology companies. “We have achieved about 70 percent local traffic exchange, which has helped attract global companies like Google and Meta into Nigeria,” he said.

Adumike emphasised that building a sustainable digital economy requires businesses to think beyond profit and focus on developing a broader ecosystem. “It is not enough to go into business just to make money. When you invest in infrastructure such as connectivity or data centres, you are building part of the ecosystem that other sectors depend on,” he said, encouraging collaboration and infrastructure sharing to reduce network expansion costs.

Meanwhile, Fagbule highlighted journalism’s role in shaping public understanding of the digital economy. “There is a lot behind simply making sure that a network works. Journalists need to tell the full story so people understand both the challenges and the opportunities,” he said.

Stakeholders concluded that Nigeria’s ambition to build a robust digital economy hinges on government and industry collaboration to remove regulatory obstacles, improve policy consistency, and create an enabling environment for long-term investment.