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Ministry of Communications and Digital Economy: Beyond the Nomenclature

By Elvis Eromosele

The Federal Ministry of Communication has a new name. It will henceforth be known, called and referred to as the Federal Ministry of Communication and Digital Economy.

When the news broke last week that the Federal Executive Council (FEC) had approved the name change, there was plenty of cheers and jeers.

In itself, there is nothing wrong with a name change. Infact, this change takes cognizance of emerging global trend. It shows awareness of the growing significance of the place of digital technologies in modern societies. It also seeks to take advantage of the development. At face value, this name change definitely looks like a good thing.

This makes sense especially when one considers that the world, itself, is changing. This change is driven largely by the wide spread deployment of digital technology infrastructure which is in fact, a huge contribution in changing how humans live, work and plan.

Experts in different parts of the world insist that the wide spread deployment of digital technology is hugely transforming industries and spurring unprecedented socio-economic development. New and emerging technologies enable and precipitate unimaginable innovations at near breakneck pace.

These days, it is obvious that innovations arrive every day to make life easier.

For example, digital technology makes it so much easier and faster to transact businesses across borders. Digital technology continues to break borders and reshape boundaries. Today, it is creating a connected society that is the basis of the emerging digital economy.

The digital economy is the economic activity that results from everyday online connections among people, businesses, devices, data, and processes. It is said that, “The backbone of the digital economy is hyper-connectivity which means growing interconnectedness of people, organisations, and machines that results from the Internet, mobile technology and the internet of things (IoT).”

According to a report by the World Economic Forum, “By 2022, over 60 percent of global GDP will be digitised. Indeed, an estimated 70 percent of new value created in the economy over the next decade will be based on digitally enabled platforms.”It is clear therefore that digital economy is already upon us.

Thankfully, Nigeria is abreast of the trends. Experts say it is as a result of the dedication to massive investment in digital communication infrastructure by the telecommunications companies. In close to two decades, conservative estimates put the figure at over $40 billion. A direct manifestation of this investment is the number of mobile subscribers currently at over 172 million according to figures from the Nigerian Communications Commission (NCC).

Despite this growth, a lot more still needs to be done. Take internet penetration which stands at about 50 percent. A massive 50 percent of the population are still out of the internet loop. Internet access must become ubiquitous to get more people into the digital economy. This is the only way people can possibly partake and benefit.

Consider, Electronic Commerce (e-commerce). It is has taken off with a blast in the country. it is now an area of global investor confidence in Nigeria. The Euromonitor International Market Research reveals that e-commerce advancements have been most notable in Nigeria because of the surge in telecom investments and smartphone purchases which have fueled growth in internet usage.

In addition, the Central Bank of Nigeria’s (CBN) cashless policy initiative also helped to drive uptake as it is precipitating new and exciting payment options. These are the building blocks of the digital economy – digital infrastructure, internet connection and effective e-commerce along e-payment systems.

The above is precisely why talks of taxing e-commerce transactions by the Federal Inland Revenue Service (FIRS) is abhorrent. This will thwart the efforts to encourage the growth of digital economy in Nigeria. The Ministry of Communication and the Digital Economy must quickly address the issue and nip it in the bud.

The Nigerian government is big on ease of doing business.The latest report justifies the commitment and effort the government is making. Progress is been made. More still needs to be done however. Undoubtedly, the proposed e-commerce tax negates this well thought out policy drive and should be jettisoned.

Unarguably, in today’s world, access to broadband should be a human right. It should be given priority by the government in order to improve access across the country and be completely affordable. To encourage interest in the sector, the government must actively consider subsiding investment in the digital space. It should consider tax breaks and other incentives.

Evidently, the emergence and nurturing of activities in the digital economy are key for diversification of the economy. So, in order to demonstrate its seriousness in this regard, the government must support efforts, particularly by the private sector, to grow the digital economy. Perennial issues around right-of-way approval, multiple taxation and the designation of telecom infrastructure as critical national infrastructure worthy of special protection must be pursued until actualised.

Dr. Isa Pantami, the Minister in charge of the renamed ministry, was absolutely right when he insinuated that “The name change will properly position and empower the ministry to fulfill its digital economy objectives. It will further expand the ministry’s mandate to capture the goals of digitalisation of the Nigerian economy in line with the Economic Growth and Recovery Plan (EGRP), one of the key agenda of the present administration.”

However, beyond the name change, the ministry must demonstrate greater understanding of the issues, show stronger support for players in the sector and must be seen to encourage policies that promotes the growth of the sector.

In a year’s time, Nigerians must be able to look back and say the name change was worth it. The citizens should be able to celebrate real net impacts beyond the nomenclature!

This is how to grow the digital economy!

Elvis Eromosele, a Corporate Communication professional and public affairs analyst lives in Lagos.


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