A Still-Born Project

Fri, Mar 15, 2013

By publisher

5 MIN READ

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The federal government’s aim of providing rural telephony across the nation suffers stillbirth as the project is yet to be completed 12 years after it started

|  By Pita Ochai  |  Mar. 25, 2013 @ 01:00 GMT  |

MORE than 12 years after it was conceived, the National Rural Telephony Project, NRTP, is gasping for breath. The project, which began during the first term of former President Olusegun Obasanjo in 2001, was estimated to cost the federal government $200 million. The aim of the two-phase project was to bridge the digital divide between the urban and rural areas in the country and also create access of telecom services to the rural areas.

The first phase of the project was to cover 218 local government areas with about 636,256 lines of the Code Division Multiple Access, CDMA, while the second face was to cover the rest of the remaining 774 local government areas and the Federal Capital Territory, FCT. To enable it execute the projetct, the federal government had taken a loan of $200 million from the China Export and Import Bank, EXIM, for the project and also sourced N5 billion locally as its counterpart funding.  Officials at the federal ministry of Communications said that the project actually commenced but its design and execution was faulty from the beginning. Three Chinese companies – ZTE Corporation, Huawei and Shangai Bell – were awarded the contract to take telephony services to the rural areas but what the companies did was to build telephone exchanges in the six geopolitical zones of the country.

After observing that there was no progress in the NRTP for several years, the government of President Goodluck Jonathan decided to privatise the project and stop government investment in a sector heavily dominated by the private business sector. Last year, Omobola Johnson, minister of communications, formally announced that the exchange centres that were built in the six geopolitical zones would be concessioned to the private sector. Johnson said that the federal government had decided to privatise the exchange centres because it would not be proper for government to be involved in a sector where private investors have done very well.

“The telecom industry is fully liberalised, there is very little government involvement and, therefore, we believe that the National Rural Telephony Project is better implemented and managed outside of government. So, the six rural telephone exchanges are being concessioned to companies that have paid for them and our role is to monitor the implementation and delivery of services to the rural areas. In a sense, we are getting out of the rural telephony, she stated.

Before the announcement, the government had, in 2009, transferred the second phase to G-cell Wireless Limited, Hezomic Limited, Key Communications Limited, Suburban Broadband Limited and Voicewares Network Limited to manage. Under the new arrangement, Suburban Broadband paid $140.5 million to government to manage the FCT and Kaduna zones. Key Communications paid $38million for the Ibadan zone;  Voiceware Networks which won the Enugu paid $30 million; and G-Cell Wireless paid $20 million to take care of Bauchi zone. The companies were to build, operate and maintain the project in the different zones. But more than three years after the projects were transferred, not much has been done by the new companies that took over from the government.

According to Lanre Ajayi, president, Association of Telecommunications Companies of Nigeria, ATCON, the NRTP was designed before the revolution of the Global System for Mobile Communication, GSM, which has penetrated every nooks and crannies of the rural and urban areas of the country. Ajayi said the government never expected that the private investors in GSM would move their infrastructures to the rural areas but that has been done effectively and most rural areas now have telecom services. “If the project was done today, it would have been done differently. At the time it was started, nobody knew that GSM operators would cover the country very fast. Today, GSM service has covered 80 per cent of the populace,” he said.

Concerned about its lack of progress, the House of Representatives, had in September 2012, ordered a fresh investigation into why NRTP was abandoned. According to the House, about 10 years was enough for the project to have taken a firm root, but nothing tangible had come out of it other than loss of public funds.

The House had conducted a similar probe on the project during  the 6th Assembly (2007 to 2011), but nobody was made to account for the alleged failure of the project. Odebunmi Dokun, a member, said in a motion that the project was designed to provide three telecom centres in each state of the federation but only telephone exchanges were provided in the six geopolitical zones.

Dokun argued: “Several millions of dollars and billions of naira have been spent on this project, which was launched across each state of the federation with high hopes of changing the lives of rural dwellers. Despite the huge amount of human and financial resources already put into it, the state of the project all over the country is worrisome. On-the-spot assessment visits to one of the sites in Surulere Local Government Area and other sites in Oyo State, tell the sorry state of affairs.”

An ad-hoc committee set up by the House submitted its investigation four weeks after but no decision was taken.