Analysts: SSA Telecommunications Sector To Maintain Growth Trajectory

telecom - October 12, 2022

Analysts at Vetiva Research have predicted that Nigeria, and other Sub-Saharan Africa (SSA) countries’ telecommunications sector will maintain a growth trajectory despite a relatively low internet coverage rate.

Vetiva in its maiden SSA Telecommunications report titled, “Powering the digital economy,” asserted that there is existing huge opportunities in the telecommunications space in SSA, especially in the area of internet services.

The firm in its report said SSA is not left out of the digital shift currently shaping the world and with this, the region has seen burgeoning demand for data services.

However, broad-band penetration in the region remains comparably low and given this opportunity, telcos will continue to post strong growth in the mid-to-long term.

The Telecommunications Analyst at Vetiva, Victoria Ejugwu mentioned that “the industry still holds huge opportunity for growth given relatively low internet coverage rate”.

She highlighted that SSA was growing at a faster rate than the rest of the world, both in economic terms and in population rate; thus, the region’s young and growing population that can be characterized as digital natives, possesses a huge market for telcos in terms of demand for connectivity.

Also, increasing network coverage will further help to unlock revenue for telecom operators.

She further highlighted that telcos were making diversification efforts into the mobile money space, and this should further cement growth prospects. She noted that the region possesses one of the largest unbanked populations, and that telcos were positioned to close the financial inclusion gap and drive the region to compete with the global market.

She said, “Telcos’ reach to customers cannot be overemphasized and there is a overarching role for them to play for the region to achieve success in financial inclusion”. She, however, highlighted that downside risk to growth remains weak macroeconomic factors. According to Victoria, “the weak macro environment has a dwindling effect on purchasing power, and that might ultimately dampen demand for telco services”.

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