Nigeria will produce own subscriber identity module (SIM card), base transceiver station (BTS) for wireless communication, debit, credit and other payment cards from January next year, as stated in the country’s Local Content Policy.
This is to develop the economy further by cutting on foreign dependence.
The Local Content Policy’s guidelines and legislations targets mobile operators, banking institutions and agencies in Nigeria to use locally manufactured products, as the country moves into a cashless economy.
This is not the first time such a move is pushed in the country. Nigeria’s government was in May reported to have banned the purchase of foreign manufactured PC’s, especially by government agencies. The country’s communications regulator later withdrew the directive.
This time round however,the Federal Government of Nigeria is serious on what it terms “protection of its local manufacturing sector” to grow its domestic economy.
Mrs. Omobola Johnson, Minister of Communications Technology, argues that although most cards are imported, there are local companies with the capacity to produce and personalise them. Interventions were needed to give them significant market share, as this will eventually trickle down to the locals, she says.
To show that the government getting serious on local content production, the Ministry of Communications Technology and other ICT industry stakeholders are urging offshore manufacturers to set up local manufacturing plants in the country.
The ministry is also working with its Finance and Trade and Investment counterparts to set up subsidies for both local and foreign manufactures based in Nigeria.
Even though the minister acknowledged how costly the process is to the Federal Government, the move, according to her, is aimed at empowering domestic industries, developing local skills and providing employment opportunities for Nigerians.
Some analysts however argue that local content is not in itself an issue with or without capacity but costs of production, price and standards need to be also considered. Some are of the view that setting up the local manufacturing plants does not translate into sales.
Defending the Federal Government’s stand, Omobola said the local content agenda her ministry is developing “will soon be implemented.”
“The agenda is not so much a protectionist agenda but one that places priority on the development of our local industries by levelling the playing field or better still, making it more advantageous for companies in Nigeria to do business with other companies in Nigeria,” she said.
The minister expects the local firms to take advantage of Central Bank’s campaigns for a cashless economy — where banks, the national agencies and other corporations will move to using electronic card-based services.
Nigeria has more than half of its population living on less than US$1 a day and an unemployment rate of 23.9 percent as of 2011. The move is viewed as capable of creating jobs to about 30 percent of Nigeria’s 170 million people.
The government, some analysts observe, might be looking at the ICT industry to save the country’s economy. Last year, Nigeria’s ICT industry contributed 5.6 per cent to its GDP. The sector is one of the fastest growing in the country with a 30 percent growth rate in the last two years.
According to Omobola, Nigeria will have close to 500 million chip cards in circulation by 2015.
