MTN Will Shut Down Without Tariff Hike, CEO Says
Telecommunications giant MTN Nigeria PLC has raised alarms over a potential shutdown if tariffs are not increased to address rising operational costs.
The company’s Chief Executive Officer, Karl Toriola, issued this warning during a tour of MTN’s facilities by Fellows of the Media Innovation Programme in Ibeju-Lekki, Lagos. Toriola highlighted that the telecommunications sector is facing severe financial strain, especially from escalating diesel prices required to power base transceiver stations.
“There should be no delusion; if the tariff doesn’t go up, we will shut down,” he said, underscoring the urgency of tariff adjustments to reflect current economic realities.
The CEO noted that MTN, which has invested N2.6 billion in corporate social responsibility, according to its 2023 Sustainability Report, is currently operating on profits accumulated over two decades.
However, he stressed that this is unsustainable. “We must return the industry to profitability,” Toriola emphasized, adding that the company’s reserves are depleting.
Earlier this year, telecom operators called for the first tariff hike in 11 years, citing the need to manage rising costs and maintain service quality. Without such an increase, they warned, the financial viability of the sector, along with service standards, would continue to decline.
Toriola also pointed out that MTN, once one of Nigeria’s top corporate taxpayers, has seen its tax contributions decline due to the financial challenges. In the first half of 2024, MTN reported a staggering N519.1 billion loss, largely attributed to foreign exchange losses from the naira’s devaluation and high inflation.
In addition, Toriola revealed that MTN may suspend Unstructured Supplementary Service Data (USSD) banking services due to a N250 billion debt owed by Nigerian banks. ‘We are seeking regulatory approval to halt support for USSD services used for banking transactions unless the debt is resolved and tariffs are adjusted,” he said.
Despite the challenges, Toriola expressed optimism that the new Central Bank of Nigeria Governor, Yemi Cardoso, and the Executive Vice Chairman of the Nigerian Communications Commission, Dr. Aminu Maida, would step in to help resolve the financial crisis.
He concluded by urging swift action from the government and regulators, stressing the critical role the telecom industry plays in supporting Nigeria’s economy. #MTN Will Shut Down Without Tariff Hike, CEO Says Alleged $6bn fraud: Ex-power Minister Opposes EFCC Amended Charge
