Following two difficult years spawned by a recessionary environment, the Nigerian telecoms market is slowly returning to stronger growth. By our estimates, the retail telecoms market grew by 8%-10% in 2017, the sector’s strongest revenue performance since 2011.

The telecoms recovery is occurring on the back of a steadier, if still fragile economy. After a contraction in 2016, and a phase of flat growth in 2017, the Nigerian economy is expected to grow between 1.5% and 3% in 2018, primarily driven by a more favorable oil price environment. The Nigerian Naira has mostly stabilized, easing some of the pressure on operators to source US-dollar capital expenditure, though the multiplicity of foreign exchange trading regimes remains a factor of uncertainty.

Information and Communications Technology (ICT) sector performance indicators are turning positive as the economy continues to recover. The mobile market is on path to add its highest base of new subscriptions since 2015, according to Nigerian Communications Commission (NCC) and operator data, and this despite the impact of the protracted sale of mobile operator 9Mobile.

In addition, initial data from market leader MTN Nigeria suggests that the country’s telecoms sector could see services revenue growth in the high single digits in 2018.