Critic Slams Ghana's Telecom Policies

A prominent figure in Africa's ICT industry has slammed Ghanaian policies for discouraging local participation in the growing telecommunication sector.

The ratio of foreign ownership of telecommunication facilities to local ownership is 99 to one, while the current economic stability and regulatory policies in the country favor foreign investments, said Professor Nii Narku Quaynor, the convener of the African Network Operations Group.

In an interview with IDG News Service on the implications of increased investor interest in Ghana, Prof. Quaynor criticized the government's transfer of the national fiber optic facility to the state-owned Ghana Telecommunications Company, in which Vodafone recently took a 70 percent stake, saying the move would promote monopoly.

The transfer will not promote sharing of resources or a competitive market among telecommunication and Internet service providers, he maintained.

On a positive note, he said, the injection of capital into the sector would enhance competition, lead to the delivery of quality service, and improve consumer choice for products and services.

Although the telecommunication industry is booming, online penetration is still low, he noted, with the Internet accounting for only 5 percent of the growth in the sector.

The National Communications Authority's statistics indicate that telephone penetration at the end of the first quarter of 2008 was almost 40 percent, with greater concentration in urban Ghana.

However, Dr. Osei Darkwa, president of Ghana Telecom University College, believes that Ghana has made giant strides in investments into the telecommunication sector, which will generate employment, raise the standards of living of Ghanaians and ensure skills transfer that will make employees marketable internationally.

Speaking in an interview in Accra this week, he observed that Africa is the fastest growing market for mobile telecommunication, with a pace of 65 percent, compared to 33 percent in Europe.

Increased investor interest in Ghana is attributable to improved structures that promote free trade, Darkwa said. The nation has become a hub for business process outsourcers in West Africa because of the improved telecom facilities, he added.

Darkwa said the entry of Zain, Vodafone and Globacom into the Ghanaian telecommunication market will help lower costs.

In the early 1990s, when mobile telecommunication was introduced, a SIM card sold for 45 Ghanaian cedis (US$39) but now sells for between one and two cedis.

Darkwa argued that Westel, which has been acquired by Celtel International and is to operate under the Zain brand, controls only 10 per cent of the fixed line market.

MTN is presently the leader of the mobile telecom sector, followed by TiGo, Onetouch and Kasapa. Zain and Globacom (Glo) -- which have received the fifth and sixth licenses, respectively, to operate in Ghana -- have yet to make their mark.

Glo aims to have one million subscribers by the end of the year. However, Vodafone, with over 290 million subscribers from operations in 26 countries and 14 partner groups, has existing fixed and mobile infrastructure at its disposal.

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