Bismarck Rewane Predicts Telecoms Tariff Hike of 40-50%, Backs Move for Sector Sustainability

Bismarck Rewane, the Chief Executive Officer of Financial Derivatives, has projected a 40 to 50 percent increase in telecoms tariffs, following the confirmation of tariff hikes by the Minister of Communications, Innovation, and Digital Economy, Bosun Tijani. While the proposed hike had initially suggested a 100 percent increase, Tijani reassured that the final adjustment would be significantly lower. Rewane, speaking on Channels Television’s Business Morning, expressed his belief that a tariff increase in this range would be reasonable, given the years of stagnant pricing in the telecoms sector. “The proposed 100% increase will definitely not happen. We expect the adjustment to be between 40 and 50%, which is a fair and necessary step after years of minimal tariff changes,” he explained. Rewane, a prominent economic expert, has previously supported the tariff hike, emphasizing that the adjustment would enhance the long-term sustainability of the telecommunications industry. “The hike will lead to better investment in the sector, allowing for greater industry sustainability and productivity,” he added, pointing to a recent surge in the price of MTN shares, which rose by 10 percent to N220. “Investors have already factored in the expected tariff adjustments, and they are anticipating positive returns,” Rewane noted. According to Rewane, the proposed tariff hike could lead to indirect benefits, including improved sector productivity, which may help moderate inflation rates. “An increase in productivity and output in the telecom sector is likely to have a positive ripple effect across the broader economy,” he said. Rewane also highlighted the importance of balancing the tariff adjustments with quality of service, a concern echoed by the sector’s regulators. “The policymaker, Bosun Tijani, has emphasized the goal of a sustainable telecom sector, while the regulator has assured that they will enforce high service standards,” he concluded, underscoring the need for both profitability and consumer satisfaction in the evolving telecom landscape.