Nigeria has a federal republic form of government and has recently undergone transition from military rule to civil rule. Due to the absence of a government accountable for its actions, Nigeria has faced problems of political instability and corruption in the past, and the country is now in the process of establishing itself as a reliable and trustworthy international business community.
Nigeria has a vast population base of more than 125 million people, more than France and the UK combined, and a rich cultural diversity with approximately 250 ethnic groups living in this one country.
Nigeria's economy is dependent on both agriculture and oil earnings. The country is currently undergoing several economic reforms and faces issues with the privatisation of different industries. Political instability, a high level of dependence on oil reserves, which are affected by world price variations, a large population base and many other factors have slowed the economic growth of Nigeria.
The government took various initiatives during 2003-2004 to boost economic growth in Nigeria, such as deregulating fuel prices, the privatisation of the country's four oil refineries, etc., and as a consequence, GDP rose significantly.76
Table 1 provides an overview of the country's key economic parameters.
The total number of mobile subscribers in Nigeria as on 31 December 2010 was 87.3 million, with a penetration rate of approximately 55 percent.
The subscriber base more than tripled in one year, increasing from 3.15 million at the end of 2003 to 9.58 million at the end of 2004.
The number of mobile subscribers in Nigeria is expected to increase at a CAGR of approximately 30.2 percent from 18.56 million at end-2005 to 90.47 million at end-2011. The corresponding penetration rate is expected to increase from 14.4 percent to 60.9 percent. Moreover, 3G services, expected to be launched in 2006 are likely to account for approximately 13.4 percent of the total subscribers in 2011.
Table 3 shows the forecasts for mobile subscribers in Nigeria for the 10-year period from 2002 to 2011.
The four operators currently providing mobile services in Nigeria are discussed below:
MTN Nigeria
MTN Nigeria is the subsidiary of MTN International and launched its GSM services in the country in 2001. The operator also provides 2.5G (GPRS) services. At present, it is the largest operator in terms of subscribers. Its network covered more than 58 percent of the total population of Nigeria at end-March 2005.
The company has significantly increased its pace of network expansion in the country in order to cope with the increasing subscriber base and solve network congestion problems. MTN had invested more than USD 1.8 billion on its network infrastructure in Nigeria by end-March 2005.
Figure 3 shows the ownership structure of the company as on November 2005.
