MTN pledges R23bn fresh investment in Nigeria

Samuel Mungadze
By Samuel Mungadze, Africa editor
Johannesburg, 30 Jan 2020
MTN Group chairman Mcebisi Jonas.
MTN Group chairman Mcebisi Jonas.

MTN has committed a R23 billion ($1.6 billion) fresh capital investment in Nigeria over the next three years to strengthen and expand its network in the West African country.

MTN Nigeria accounts for a third of the Johannesburg-based group’s core profit and the telco has over 60.3 million subscribers in the country.

On Wednesday, an MTN delegation, represented by group chairman Mcebisi Jonas, chairman of MTN Nigeria Dr Ernest Ndukwe, MTN Group CEO Rob Shuter and MTN Nigeria CEO Ferdi Moolman, met with president Muhammadu Buhari of Nigeria, to announce the investment.

The group also met with key government officials, including minister of communications and digital economy Dr Isa Ali Ibrahim Pantami, governor of the Central Bank of Nigeria Godwin Emefiele, and attorney-general and minister of justice Abubakar Malami.

Commenting on the investment, Jonas said: “We are steadfast about our investments in Nigeria, particularly over the next three years as we aim to strengthen and expand our network and systems. We are fully aligned with the strategic agenda of the Nigerian government and are committed to strengthening the digital economy of the country.”

Explaining his group’s commitment to the West African nation, Shuter said: “Financial inclusion and access to funding and digital services all become easier when our continent is powered by connectivity.

“The benefits of a connected continent are far-reaching, making a positive impact across Africa. We cannot achieve this goal on our own, and are working on strengthening relationships with our key partners to extend access to comprehensive and affordable solutions to all.”

On his part, Buhari reaffirmed the government of Nigeria is committed to providing an enabling environment for businesses to succeed.

He further explained that his government is looking at ways to increase the level of security across critical national infrastructure, noting it would guarantee seamless service delivery and also facilitate investments throughout the country.

Buhari expressed his support of MTN’s drive in supporting Nigeria's digital inclusion programmes and its commitment to growing the telecommunications industry across the region.

MTN’s latest investment comes a few weeks after the telco was let off the hook in Nigeria following the attorney-general’s decision to withdraw a $2 billion tax claim.

MTN has had long-running battles with Nigerian authorities on a myriad of issues.

In August 2018, the Central Bank of Nigeria (CBN) demanded MTN repatriate $8.1 billion (R117 billion) to Nigeria, which the bank said the company had sent abroad in breach of foreign exchange regulations. MTN denied the allegations.

In December of the same year, MTN agreed to make an almost $53 million payment to resolve the dispute. At the time, it said MTN Nigeria and the CBN had agreed it would pay a notional reversal amount of $52.6 million, without admission of liability. This was for a 2008 private placement remittance worth around $1 billion that the CBN found was based on certificates that did not have final approval.

Almost three years ago, MTN agreed to pay more than $1 billion to settle a dispute over SIM cards in Nigeria. This was after the telco failed to meet a deadline to disconnect 5.1 million unregistered SIM cards on its Nigerian network.

In related news, MTN Nigeria today appeared before a Federal High Court in Lagos, Nigeria to formally discontinue its legal action against the attorney-general of Nigeria and minister of justice.

MTN applied today to have the legal action struck out, which request was granted by the court.