25% of GT Workers To Be Made Redundant

The National Communication Authority (NCA) is in the process of breaking up the multi-million dollar exclusivity advantage enjoyed by Ghana Telecom and Westel in the control of international telecommunications, to and from the country.

The decision, yet to be approved by the NCA board, will immediately bring Scancom Limited, the owners of Spacefon on board once they satisfy certain criteria, and the competition is expected to further reduce the cost of making international calls.

Both NCA and Spacefon agree that this is the way forward to improve services for the Ghanaian telephony consumer, who has been benefiting from the current price wars between the local phone companies.

But GT, which is 70% owned by the Government of Ghana is asking the NCA to suspend the liberalization of the international gateway for another four years to enable it to fulfill its expansion objective.

In an interview with GT’s Chief Financial Officer, he warned that the move by the NCA could lead to annual losses of 10 to 15 million dollars to GT, “which is in excess of our expected profit for 2003”.

The revenue that GT makes from international calls account for about 15% of the company’s total revenue. It currently makes about $20 million a year on it. Sven Seim is of the view that a reduction of this to about $6 million would lead to job losses. “If the NCA goes ahead with this, we have to lay off between 800 to 1,300 of our 4100 workforce”.

While saying that GT is not against competition, Sven Seim is of the view that it would be difficult for GT to fix the 400,000 targeted lines if it loses about 60% of its revenue from international traffic.

But both the NCA boss, Major Tandoh and Managing Director of Scancom Ltd, Ahmed Farroukh say the GT does not have of a case.