This article is not about the NPP or NDC government. It is about the Government of Ghana as a continuum and how the actions and inactions of policymakers and their implementing agencies have created the current status quo we have in the telecoms industry.
The Government of Ghana used to own 100% of Ghana Telecom before it was divested in 1996, along with liberalising the entire telecoms industry. Vodafone purchased 70% of Ghana Telecom, and since then, the government has always held 30% of the of the golden shares in what became Vodafone Ghana and now Telecel Ghana. Similarly, through the Ghana National Petroleum Authority (GNPC), the government established Westel in partnership with US-based Western Wireless. Westel then became Zain, and later Airtel. Over the transition period, the government, through GNPC, held some 35% of the shares in the company. Then, when Airtel merged with Tigo to form AirtelTigo, the government’s shares were reportedly recalibrated to 10%. But now the government owns 100% of AirtelTigo (now AT Ghana), which it purchased for US$1 after both Airtel (Bharti) and Tigo (Millicom) checked out of the Ghanaian market.
That is the simplest way I can put the Ghanaian government’s involvement in the telecoms industry over the years. You can also read more about the evolution of Ghana’s telecom industry in the previous articles here and here.
But the elephant in the room that needs to be addressed is this: of what real value have all these government golden shares in these two telecom companies been to the telcos, given that, in spite of them being in bed with the government of Ghana (so to speak), they have been on the stretcher for many years now, and all efforts to save them recently have proved too late and completely futile.
That money is still not for government? So, what is wrong with the Finance Ministry asking the Communications Ministry to instruct the NCA to issue the licenses (spectrum) to the two telcos, and then the two ministries will work out a payment plan to sort themselves out? Why do we make it look as if money paid to the NCA is private funds? That thing has never made sense to me. After all, it is all government, and in doing so, they would have saved the two telcos and other smaller ones from collapse, protected governments interest in those telcos, and also prevented the kind of market gap that led to naming MTN SMP and forcing them to burden Ghanaians with high data prices.
Suffocating Tower Cost
One other major pain area for the non-SMP telcos in Ghana is tower cost. Apart from MTN, all the other telcos and ISPs (internet service providers) owe tower companies like ATC Ghana and Helios Towers millions of dollars in monthly fees as well as utility and fuel bills. In fact, the smaller telcos actually have legacy debts that they are still paying off, while the recurring bills also keep piling up. A lot of the ISPs have collapsed under the weight of these legacy tower costs. How the government would hold 30% shares in Vodafone and 35% shares in Airtel and still sit by and watch all these costs pile up is another thing that baffles my mind.
Interestingly, it was the government, through the NCA, that made it compulsory for all operators to do tower co-location. Government policy gave birth to a tower company like ATC Ghana, which is now unplugging operators, including even Telecel Ghana, for alleged indebtedness. In fact, the government and the NCA sat by and watched the towercos operate a passive system where they charge their fees in spite of whether or not an operator is making money from a particular tower. Provided the equipment of the operators is on the premises of the tower, the towercos charge their fees. The government could have moved in and protected its 30% and 35% interest by either paying those fees or crafting a policy that protects the industry from exploitation by towercos instead of allowing the towercos to make crazy profits off the industry, while the telcos in which the government has interest suffocate to death.
Stay tuned for part two. It has some suggestions for government as a continuum.
Source: TechFocus24