THE chief executive officer (CEO) of MTN Nigeria, Karl Toriola, said the company is likely to shut down its operation if the tariff does not increase, lamenting the unhealthy financial position of the telecom giant.

Toriola raised the concern during a tour of MTN’s facilities by fellows of the media innovation programme in Ibeju-Lekki, Lagos on Monday, October 21, the Punch reported.

“There should be no delusion; if the tariff doesn’t go up, we will shut down,” he was quoted to have said.

He noted that MTN’s corporate tax contributions to the Nigerian government have declined due to the financial challenges faced by the company following the recent macroeconomic reality.

In the first quarter of the year, MTN continued to perform poorly, posting a loss after tax of N392.694 billion due to the concentration of funds outside its core operations.

The negative performance resulted from foreign exchange losses stemming from the naira’s devaluation and high inflation rates, The ICIR reported.

The MTN boss said the company might suspend the Unstructured Supplementary Service Data (USSD) banking services due to the N250 billion debt owed by Nigerian banks.

Mobile network operators have raised concerns over this indebtedness by the banks, seeking regulatory approval to halt the support services until the debt is paid.

The operators have also sought for upward adjustment of tariffs to reflect the economic realities.

Toriola hinted that MTN Nigeria is surviving on the profits it accumulated in the past years. He stressed, “We must return the industry to profitability.”

He hinted further that the company is currently operating on its reserves, describing it as unsustainable in the long run.

Toriola added that the telecoms sector faces critical pressures from rising operational costs, including escalating diesel prices required to power base transceiver stations.

The ICIR can report that telecom operators had earlier in the year renewed calls for a tariff hike to address rising operational costs and improve service quality, without which financial viability and quality services will continue to decline.