The Minister of Communications, Innovation, and Digital Economy, Dr. Bosun Tijani, has said that the federal government will provide half of the $2 billion required to deliver the country’s 90,000-kilometre fibre project.
The Minister, who disclosed this while featuring on an Arise TV program on Friday, said the project, which will be financed by loans is part of the government’s borrowing plans for 2025.
“Earlier this year the FEC approved a memo which was to set up a special purpose vehicle that is meant to deploy 90,000 kilometers of fiber optic cables in Nigeria. Half of that money is what the government will make available.
“The half that the government is making available which is just short of $1 billion is being secured through loans,” the Minister stated.
Presidency’s support
Tijani said the project has also received immense support from President Bola Tinubu, the Ministry of Finance, and the Minister as well.
- In addition to the government funding, he said the Ministry has secured private companies that will provide the other half of the funding for the project.
- While noting that significant progress has been in terms of discussions with funding partners of the project, especially the World Bank, the Minister said the government is hoping to commence digging for the laying of the cables in Q2 2025.
Why the government must invest in backbone infrastructure
On why the government must invest in backbone connectivity infrastructure, Tijani, said many Nigerians are complaining of poor quality of service today because of the inadequacy of the infrastructure deployed by the private operators.
He noted that the operators would only invest in areas where they can get higher returns, which is why some parts of the country have been experiencing a lack of or poor connectivity.
“When we came in the assessment we did was that as a nation you have two options to build in the backbone for digital economy and connectivity.
“For people to truly enjoy quality connectivity, you will either have to rely on private companies, the MNOs, the infracos, to put their private funding into building expansive and extensive network for connectivity within the country.
“But the challenge with that approach, which is the first approach, is that businesses would only invest significantly where they are sure that their returns can be guaranteed almost immediately, at least in a short to medium-term sense.
“The other option, which is the common option that you’ve seen in many progressive countries, is that government will have to understand and of course put its own skin in the game, knowing that connectivity is now clearly an important resource that every citizen should have access to, regardless of where you find yourself,” he explained.
- He said this realisation led to the setting up of a special purpose vehicle to drive the deployment of 90,000 kilometers of fibre cable across the country.
- According to him, the SPV is not a government entity but the government will invest in it and it will be managed as a private entity with the government representative as part of its board.
What you should know
Dr. Tijani earlier in May this year announced the approval of the SPV by the FEC, noting that it would be modeled in governance and operations similarly to some of the best Public-Private Partnership setups in Nigeria, such as NIBSS and NLNG.
- According to him, the government would be working with partners and stakeholders from the government and private sector to build the additional fibre optic coverage required to take Nigeria’s connectivity backbone to a minimum of 125,000km.
- He added that that project would also help in increasing internet penetration in Nigeria to over 70% and reduce the cost of access to the internet by over 60%.
- Through the project, Tijani said Nigeria would achieve the inclusion of at least 50% of the 33 million Nigerians currently excluded from access to the internet.
It is also expected to deliver up to 1.5% of GDP growth per capita raising GDP from $472.6 billion (2022) to $502 billion over the next 4 years.
