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Opinions Sat, 11 May 2002

Ghana Telecom Hangs In TheDark

Uncertainties About The Prospective Investor The fate of Ghana Telecommunications Company Limited seems to be hanging in the dark. By the close of day 19th of May 2002, the 3 month ‘grace-period’ given to the Malaysian Management, by the Honourable Minister for Telecommunications and (Information) Technology, comes to an end. There does not seem to be any clear direction as to what happens from the 20th of May 2002. Currently, it is alleged that about 6 companies or entities have applied for shares in Ghana Telecom; including Vodaphone and British Telecom.


The 1-month deadline

It is questionable how any reputable company may be able to come up with realistic, well-thought-out proposals within the space of 1 month. This 1-month deadline given by the Honourable Minister has raised many doubts and suspicions to the effect that there already is a done deal in the pipeline, with the 1-month advertisement only being used as a cover-up or a formality.

The 1-month deadline raises serious questions about the ‘reputability’ of any ‘prospective’ telecommunications company or investor.


The Honourable Minister’s ‘Secrecy Policy’

All of these factors, coupled with a dogged determination not to consult the relevant bodies, leaves thinking Ghanaians with a very uneasy feeling about the whole deal and a distinct impression of ‘deja vous’. The appointment of the last Telephony advisor to the Minister came to an end towards the end of last year, 2001. It is not known who is advising the Minister on Telephony and Telecommunications at this juncture. It was precisely this shrouded approach to the entire Malaysian telecoms deal which has left Ghana in such a sorry state of poor quality telephony and telecommunications service delivery, with its subsequent knock-on effects on the rest of the other sectors of the economy, and the country in general.


Merits and Demerits of Foreign Investment

Whilst the idea of investors (usually foreign) may have its merits, the chances are that foreign investors in particular prefer short-term investment, particularly given the generally unstable situation in African countries (not to mention the ever-rising high crime rate). To be really successful, Telecommunications Development, being the nervous system of the nation, needs to have long-term comprehensive visions and plans, with allowances for change and adaptation, and not short-term, piecemeal, unco-ordinated and half-planned projects, with no proper synchronization and harmonization.

National Communications Authority

One major concern of (foreign) investors is A LEVEL PLAYING FIELD. This means a strong and fair regulator, ie the National Communications Authority (NCA). However, with the Minister himself being the chairman of the NCA; and also with unified allegations from several divergent sources purporting that the Honourable Minister is populating the National Communications Authority with his own relatives whose qualifications to do the job are doubtful, the chances of a strong regulator hangs very precariously in the balance.

Another important lesson to be learned from the Malaysian Catastrophe is that any future contract with investors must have a YEARLY REVIEW concept. In the case of the Malaysian Catastrophe, (which is really the fault of Ghanaians), the contract was signed for a 5-year period with no yearly review. The investor’s performance must be reviewed every year, according to specified targets, giving the option of terminating the contract should their services be found to be unsatisfactory.

For Ghanaians, the real issue is not who comes to invest per se. Malaysians have developed their country into a very beautiful one. Unfortunately, when they came to Ghana, they did not develop Ghana as it was hoped they would. Ghanaians must wake up to the realization that the days of the foreign charitable Missionaries who built the schools, hospitals, roads…, (in fact Ghana), are long gone, and that just handing over one’s vital entities to a ‘competent’ investor without proper structures and regulation will not produce the desired results. Whilst it is critical that whoever comes to invest in Ghana has a good track record, (something that the neophyte Consortium led by the Malaysian Telecommunications Company did not have) it is far more important how we regulate the investor, and make them conform to high standards of telecom service delivery.

With the rate at which Telecommunications and Information and Communication Technology (ICT) is galloping, the regulators would need to be currently updating themselves with the new technologies, and more importantly, how to migrate from the current obsolete telephony infrastructure to the more accommodating internet infrastructure, the benefits, the merits and demerits; and also, how these new technologies affect the current networks.

The regulators would need to be constantly on top of the technologies, and not the type of stagnant experts who currently populate the National Communications Authority (NCA): people who were genuine experts in their day, but have refused to keep up with the changing technology, stuck in an expertise of yesteryear, frozen in time, and lost in antiquity.




The NCA must develop their own methods of determining quality of service. They must not rely on operators to provide data with which to measure their quality of service. (It is like asking a man to provide a rope with which you want to hang him with). The NCA must develop its own strategies and stratagems with which to measure quality of telecoms service delivery.

Their current performance is completely abysmal and is a clear waste of tax-payers money.

But perhaps the most important issue is whether the NCA has legal rights to exist and act at all.


Competition

The most disturbing factor of all seems to be the over-reliance on Ghana Telecom to do everything. As at now the telephone density figures stand at about 1% questionable quality (ie 1 out of every 100 people have access to telephone service). The targets given for the new investor is 400,000? broadband lines or connections. Whilst this figure sounds realistically impressive, this may not appreciably raise the internet density in Ghana significantly. What is required is more competition. Whilst it is true that the duopoly has officially been declared as having come to an end, there does not seem to be any clear push from the Ministries to actively encourage competition. It appears as if because one of the HIPC (Highly Indepted Poor Countries) conditionalities is that Governments must divest itself of their shares in Public Utilities and Ventures such as Ghana Telecom, this has become the main pre-occupation of the Government. However more competition must be encouraged, and innovative strategies to develop this competition must be dreamed up, in order to increase the telecommunications density and also the quality of service. With the other 98%-99% of Ghanaians without telecommunications facilities, and about 50% + aggressively demanding telecommunications services, the promotion of competition in the telecommunications sector in order to raise internet density has got to be high on the agenda of the GOLDEN AGE OF BUSINESS and the POSITIVE CHANGE philosophy of the current Government. Without that, the President’s dream of transforming Ghana into the ICT hub of West Africa in order to significantly raising the levels of GDP will remain exactly that… a dream.


Views expressed by the author do not necessarily reflect those of Ghanaweb.

Columnist: Khol, Kofi