The Ghana Chamber of Telecommunications wants incentives for telecom industry because it faces the threat of eventual stagnation as operational costs keep rising and revenues dwindling.

CEO of the Chamber, Kwaku Sakyi-Addo told journalists almost 40% of annual revenues of telcos go into taxes and levies, and the telcos reinvest another 40% of their revenues in Ghana, and yet their revenues keep dwindling due to stiff competition and its resultant constant tariff reduction.

The journalists had gone to the offices of the chamber as part of a four-day training workshop put together by Media Foundation for West Africa (MFWA) with support from MTN to improve telecoms reporting in the country.

Journalists were shown statistics from the Ghana Statistical Service, which indicate that in 2010 alone, 10% of government’s income was from the telecom industry and the industry also accounted from 2% of GDP, and 7% of investments in the country.

Kwaku Sakyi-Addo noted that whiles all other industries place inflationary burdens on consumers, telecom operators keep absorbing all inflationary elements on their services on behalf of their customers to remain competitive.

Kwaku Sakyi-Addo is concerned about how MMDAs keep slapping arbitrary charges, levies and fees on the efforts of telcos install infrastructure and provide better service, while average revenue per user (ARPU) has reduced from $35 ten years ago, to about $3 now, even though subscriber levels has increased tremendously over the period.

“The MMDA’s charge us heavily for installing infrastructure to provide quality service – residents oppose installation of infrastructure and yet the regulator penalise us for the occasional breaches in quality of service – something does not add up,” he said.

The Telecom Chamber Boss said as a country, “we have agreed that telecommunications is no more a luxury but a necessity for all people – so if we agree that it is no more a luxury, why are we taxing it like a luxury – why are we treating the telecoms industry like it is the tobacco industry.”

He noted that since the mid-1990s the telecom operators have invested US$5.6 billion in the Ghanaian economy and through that have created at least 1.5 million direct and indirect jobs in the country.

He said that MTN alone has so far invested US$1.2 billion, Tigo has invested over US$1.5 billion (over the last 20 years), Airtel has invested about US$700 million (but yet to break even), while Vodafone bought Ghana Telecom for US$900 million and has since invested another US$500 million.

“This is a clear sign that the telecom operators are here to contribute to the development of this country but they are under no compact or contract to stay here even if they cannot justify the heavy investments they make in the country,” he said.

Kwaku Sakyi-Addo explained that the telcos in Ghana are all multinationals, and the threat to their investments in Ghana means they can soon start looking at other markets, which promise better returns on their investments.

“What is the justification for reinvesting heavily in this market if telcos cannot explain to their investor why ARPU’s are falling as cost rises,” he asked.

The journalists also went to the NCA, where the Director-General, Paarock VanPercy agreed that some of the operational charges by the MMDAs on the telecom operators are too high so the NCA is working with the Ministry of Local Government to address it.

He however noted that telecom is business so the telecom operators should be ready to meet the statutory obligations that come with doing business in Ghana.

Director of Regulatory Administration at the NCA, Joshua Peprah said the NCA has a duty to hold the telecom operators to their licensing requirement to provide high quality service and if the NCA would not let them go free if they fail on that; and customers would also punish operators by porting out.


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