Nigerian economy hit hard by Internet outages
The Nigerian economy has suffered a major setback, due to recent network disruptions experienced by two of the country’s leading telecoms service providers, MTN and Airtel.
The disruption, which began late last week, has sent shockwaves across various sectors of the economy, raising concerns about its impact on the country's stability.
The network disruption was caused by damage to undersea cables, which occurred along the western coast of Africa, notably in Cote d’Ivoire. The affected cables are WACS, MainOne, SAT3 and ACE.
Both Internet and mobile communication services have been affected, leading to significant connectivity issues and disruptions in business operations.
The Nigerian economy has been particularly hard hit by the disruption. Reliable network services are crucial for online transactions, and the disruption has led to a decline in sales for online retailers, with customers facing difficulties in accessing e-commerce platforms. According to statistics by Mordor Intelligence, Nigeria’s e-commerce market size is estimated at $8.53 billion in 2024, and is expected to reach $14.92 billion by 2029, growing at a compound annual growth rate of 11.82% during the forecast period.
Temidayo Adefioye, CEO, Switchcon, expressed concerns about the situation and said that the disruption has dealt a severe blow to the Nigerian economy. He added that the e-commerce sector has been a major contributor to employment and revenue generation, and this disruption will result in substantial financial losses, hinder market growth, and dampen investor confidence.
“The network disruption has, to a large extent, affected the financial sector, hindering online banking services and mobile payment platforms. Also, access to banking services has been impeded, leading to delayed transactions, limited access to funds, and difficulties in conducting business operations. This has affected individuals as well as corporate entities, including payment processors and financial institutions, with implications for financial inclusion and the efficiency of payment systems.”
He further stated that remote working arrangements have also been hindered, which has impacted various sectors, including IT, call centres, and consultancy services.
Oyindamola Idowu, an IT enthusiast, highlighted the broader implications of the disruption.
She said: "The network disruption experienced by MTN and Airtel has revealed the vulnerability and dependence of Nigeria's digital economy on a few service providers.”
Idowu said this proved the need for diversification and the establishment of robust backup systems to mitigate future disruptions. Investments in alternative networks and infrastructure will be crucial to ensure the resilience of Nigeria's digital economy.
She said the disruption has also had implications for the education sector, as schools increasingly rely on online platforms for teaching and learning.
In a similar vein, James Agwu, a Nigerian data analyst, expressed his frustration on X (formerly Twitter), highlighting the significant disruption and financial losses experienced by individuals and businesses. He called for accountability from MTN and criticised its lack of explanation and resolution. He argued that the government should take action to hold MTN accountable for the situation.
“The Nigerian government, along with regulatory bodies, should actively engage with MTN and Airtel to resolve the network disruption and minimize its impact on the economy. Efforts should be made to restore services and implement measures to prevent similar disruptions in the future,” he said.
As Nigeria awaits the full restoration of network services, the economic repercussions of the disruption serve as a reminder of the importance of a reliable and resilient digital infrastructure.