Telcos lament forex scarcity, seek CBN intervention

Operators in the telecommunications industry are seeking special consideration to enable them get access to more foreign exchange.

Some industry stakeholders who spoke to our correspondent said operators were struggling to get foreign exchange, and this had been responsible for some drop in service quality.

The President of Association of Telecommunications Companies of Nigeria, Ikechukwu Nnamani, said in a telephone interview that stakeholders were seeking special intervention from the Central Bank of Nigeria.

He said, “Lack of forex to telcos is an open secret. Forex is scarce in the country, and it affects the telco subsectors.

“We have been asking for special consideration from the Central Bank of Nigeria, but we’ve not got it.

“We are hoping this happens, given the critical role telecom plays. We are hoping the CBN will soon begin to give special consideration to the telcos. We’ve been trying to engage with them, to see how possible it is.”

When asked if telcos resort to black markets for forex, Nnamani said, “If you are desperate and want to transact, yes. Although, it comes at a higher cost, which increases the cost of doing business.

“We are also hoping the Nigerian Communications Commission will work with us and get the CBN on our side. It is one of the things the association is working on.”

Managing Director/ Chief Executive Officer of VDT Communications, Biodun Omoniyi, said the industry was import dependent; thus, the need special forex intervention.

Omoniyi said, “There is no accessibility to forex, which affects the quality of service as operators cannot quickly replace damaged equipment.

“When we talk about communication, we are also referring to the equipment involved. We don’t manufacture them in Nigeria.

“We import almost everything in the telecom space. We are import dependent and need forex for almost everything in the space, including computers.

“We can’t expand our networks without buying more equipment, which means forex.

“Operators are not getting easy access to forex, and I don’t think anyone is getting easy access to forex. I think it is affecting other industries as well.”

Omoniyi also lamented that the fall of the naira had increased the cost of equipment and service delivery.

He said, “Telcos provide service in naira. The naira has been falling; so it is more expensive to buy equipment. Since COVID-19 started, the naira has lost about 35 per cent of its value.

“Before, we used to buy the dollar for N350 or N360; today it is N500. That is N150 more. The naira you have gathered today or one year ago and feel would be able to buy you three equipment can just buy you two at most now.”

MTN had recently disclosed that dearth of foreign exchange was hampering the repatriation of profits to shareholders of the company.

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