Impact Of Depreciating Naira On The Tech Sector
With a steady free-fall of the naira, to less than 50 per cent of its value since April 2015, this has led to a serious technological development concerns and consequence for Nigeria. It is such a worrying moment for most business, technology and telecom firms operating in Nigeria.
In a Naija news report, the slip of the naira currency down the slope and alley of technology backwardness is, to state the least, the resulting impending danger that awaits technology stakeholders at all levels of the economy. If this issue is not checked quickly, it may further send the country backwards from what is already an ‘eggshell’ fragile technology development, onto a banana skin retrogression which could make other nations leave Nigeria further way behind.
Over the last 20 years, Nigerians living in the Western part of the world have become one of the best sets of people with great technology expertise, second only to Asians. Many Nigerian technology experts and professionals in Diaspora have accomplished magnificent achievements for themselves and their adopted countries, most of whom were no longer interested on returning back to their motherland until about five years ago when the country began to pave way for their return through the attraction of fairly stable exchange rate and business’ willingness to pay fairly decent wages in return for the expertise provided which made returning home a bit more attractive.
However, the economic cycle in which Nigeria finds herself today has yielded more cons than pros such that business and technology development have slide down considerably as the exchange rate saga plays out. More and more technology experts and professionals are returning to Europe and America to ply their trade as the depreciating naira value is no longer justifying their stay in the country nor able to maintain their life styles.
In most cases, many of them have friends and families living abroad and therefore have foreign exchange commitments which cannot be met on their current naira income. For example, a technology professional engaged in April 2015 when the exchange rate was $1 to N150 is now effectively earning half of the wage in 2016 when unofficial rate from banks is $1 to N320. With mortgage, education and other commitment abroad, the professional may be left with no option but contemplate a return to a place where he or she can meet her/his obligations. Expansion of the ICT infrastructure has become a daunting task in Nigeria due to the epileptic power supply situation that has crippled the nation’s economy over a long time now. The lack of equipment is another factor as technology transits from 2G, 3G and 4G, and also which studies have shown that there is a deficit of some 20,000 BTS in the country.
The quality of services from our telecoms provider will continue to be a challenge until the enormous gap between available base transmission stations (BTS) and the required number is bridged. The investment is still needed to bridge existing gaps in the industry. More also, all these equipment could only be imported into the country with a stable Forex rate.
On a final note, the task of delivering technology is becoming more challenging and very expensive once again as skilled technologists are becoming rarer in Nigeria, by the day. Despite our local resources that were understudying, ‘Returnees’ are beginning to find their way out of the country for greener pastures. There is a new level of attrition amongst technology personnel, especially those with less than five years of experience, most of whom either find ways to travel overseas or hop to other local employer to double their earnings.
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