Bird & Bird Communications in Emerging Countries May - June 2012

 

Good economic performance of Sub-Saharan Africa in the context of global uncertainty

 

Despite difficult external conditions, output in sub-Saharan Africa grew by 5 percent last year” relates the International Monetary Fund1. In the Fund's annual Regional Economic Outlook published on 14th May, a positive assessment is drawn of sub-Saharan Africa’s growth. In the context of global uncertainty, most countries marked good performance and shared in this solid expansion. However some countries (i.e. South Africa) were slowed by weakness in major European trading partners. Regarding western Africa countries, they were affected by drought in the Sahel and civil conflict in Cote d’Ivoire. Moreover consumer price inflation rose, particularly in eastern Africa, sparked in part by sharply higher global food and energy prices.


Expectations for 2012 are optimistic and the output growth should remain strong. However this broadly favourable outlook remains vulnerable mainly because of global uncertainties, financial stresses in the euro area and the possibility of a surge in oil prices or geopolitical risks.

 

[1] Regional Economic Outlook. Sub-Saharan Africa. Sustained Growth amid Global Uncertainty. International Monetary Fund 2012, www.imf.org/external/pubs/ft/reo/2012/afr/eng/sreo0412.pdf  

 

Business opportunities

 

Morocco will launch bid for 4G in autumn
The Moroccan press has reported that Morocco will launch a tender for 4G licenses next autumn. According to El Azdine Mountassir Billah, director of the regulatory authority (National Agency for regulation of telecommunications - ANRT), licenses will be awarded at the beginning of 2013 with a view to effective launch of services in 2014. He added that Morocco would be entitled to the fourth generation of mobile Internet 4G barely a year after it came into service in (the) most developed European countries. The Regulator’s objective is to connect all of the Moroccan population to broadband by 2020.


As a matter of interest, there are three operators on the Moroccan telecommunications market: Morocco Telecom, a subsidiary of French group Vivendi, Meditelecom, a subsidiary of France Telecom-Orange and Wana, owned by a holding company controlled by the royal family and the Kuwaiti Sharifian Zain. Therefore, the arrival of 4G could allow the emergence of a new operator.


Source: www.agenceecofin.com

 

Bid for 3G licence in Cameroon

Cameroon has launched an international tender to grant a license to establish and operate a network of mobile electronic communications, including the 3G frequency resources. Interested investors are invited to submit an expression of interest in French and in English. Nonetheless, they are required to satisfy the following criteria:

  • be a telecommunications network operator belonging to a internationally renowned group and not operating in Cameroon;
  • to have USD 200 million of stockholders’ equity in December 2012,

The deadline for submission is set for 13th July and the opening of submissions will take place 20th July

 

Source: DGmarket

 

Reorganisation of Tunisia Telecom – privatisation in view

With the support of its minority shareholder EIT - Emirates International Telecommunications, which holds 35 % of Tunisie Telecom’s shares, the incumbent is preparing for an important transformation: downsizing and total privatisation are considered.


EIT, a subsidiary of Dubai Holding, has persuaded the government, which holds 65% of the share capital, to engage in an in-depth transformation. A voluntary leaving plan is expected to be announced before the Ramadan month. In the long term, the government could opt for privatisation of the majority of its shares in favour of EIT.


Tunisia Telecom has many assets in particular in terms of its wire-based broadband infrastructures which have become strategic, given the growth of data traffic. Moreover, since the beginning of the year, the operator has been working to make up ground lost to its competitors by lowering mobile communication prices and redeploying its distribution network. Finally, Tunisia has launched 3G services and gained new markets with business customers.


Please note that Bird & Bird is assisting the Tunisian government on a privatisation project.


Source: Jeune Afrique

 

Sale of 3G licence in Democratic Republic of Congo

On 26th June, the Minister of Post, Telephones and ITC, Mr. Tryphon Kin-Kiey Mulumbato, announced the sale of 3G licenses to a group of operators (Africell, Tigo, Vodacom, Airtel). The price of the licence was estimated at USD 15 million.


The licence sale comes at a time when the draft 2012 budget has been declared admissible by the National Assembly. Therefore, the Ministry had to comply with the requirement of the budget and capture required revenue.


Source: www.digitalcongo.net  

 

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Regulatory News

 

Senegal: Tax on international incoming calls has been cancelled

Senegal has cancelled the tax on incoming international calls fixed at 0.215 euro or 141.035 CFA francs per minute. Indeed, decree n° 2012-500 entered into force on 15th May 15, 2012, repealing the system of control and taxation of international incoming calls, which had been established by decree n°2011-1271 of 24th August 2011. It remains to be seen how the budget gap estimated at 50 billion CFA francs due to the tax cancellation will be filled. Negotiations with operators are already being pursued in order to help the state to bridge the gap.


Senegal is following the initiative of the Minister of Posts and information technologies and communication of Ivory Coast which cancelled the tax on incoming international traffic to replace it, nevertheless, by a "telecommunications tax" set at 3% of operator’s turnover (see amendments of tax code reviewed by the appendix of the Finance bill 2012).


Source: www.balancingact-africa.com

 

Orange Guinea sentenced for anti-competitive practice but its cross border link is judged legal

A first-instance tribunal in Conakry has sentenced Orange Guinea for anti-competitive practices and abuse of dominant position in the complaint made against it by a group of Internet access providers. At the same time, the tribunal has reaffirmed the legality of the cross border link to access SAT-3 submarine cable.


Source: www.telecomreview.info  


Introduction of tax on international incoming calls in Mali

According to “Le Prétoire” newspaper, the Malian government plans to introduce a tax on incoming international calls. The newspaper has criticised this initiative explaining that such tax is counter-productive and detrimental for States, operators and users and goes against employment in telecommunication sector. Moreover, the journal recalls the fact the other countries in West Africa are currently abrogating this tax.


Source: www.agenceecofin.com  

 

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Senegal: national campaign on the quality of telecommunication services

On 25th June 2012 the Regulatory Agency for Telecommunications and Posts (ARTP) launched a national campaign on the quality of fixed and mobile networks and Internet. For a month, until July 25, users can call a toll free number, provided by the regulator, to report irregularities in the services provided by different operators: sporadic or recurring dysfunctions of telephone networks, coverage or accessibility problems in a given area, problems of Internet access, difficulties in making or receiving calls or SMS, and other problems of service quality.


Source : www.artpsenegal.net


Cameroon: 3% tax on turnover to supply telecommunications fund

Telecommunications operators in Cameroon are now liable to a 3% tax on their annual turnover. The tax, established by a Presidential Decree of 26th June 2012, will be used for supplying the Special Telecommunications Fund set up by sector reform in 1998. This contribution will be paid into an account opened at the Central Bank by the Ministry of Posts and Telecommunications. According to the decree, the fund is placed under the auspices of the Minister of Posts and Telecommunications. The Telecommunications Regulatory Board is charged with ensuring that the operators indeed pay the required amount. Since the tax is paid on the basis of turnover declared by operators, the decree empowers the Telecommunications Regulatory Board to verify the veracity of their declarations. In case of doubt, the regulator can carry out an audit at the operator’s expense.


This new tax will replace the 2% one, which supplied the Special Trust Fund managed by the Ministry of Finance.


Source: www.agenceecofin.com, www.cameroon-tribune.cm

Ethiopia bans online communications tools

On 24th May 2012 the Ethiopian government adopted a Proclamation on Telecom Fraud Offences which prohibits online communication tools like Skype. The bill states that providing telecommunications services through the internet is an offence and it is punishable by imprisonment of between 3 and 8 years. Using such services intentionally or by negligence is punishable by imprisonment of between 3 months and 2 years.


Source: www.agenceecofin.com, http://transformingethiopia.wordpress.com

 

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Who does what

 

Nationalisation of Djezzy

Takeover by the State of a 51% stake in Algerian operator Djezzy is scheduled for the coming months. Therefore, the State will control two mobile operators in the country.


Karim Djoudi, the Minister of Finance, has confirmed the continuation of negotiations with the Russian group VimpelCom which bought Djazzy in October 2010 (it holds a 51.7% stake in OTH).


This operation is the outcome of a process started in early 2010 when Alger decided to buy the mobile operator Djezzy (at that time a 96,8%-owned subsidiary of Egypt's Orascom Telecom Holding OTH) by asserting its preferential right under the 51/49 rule which states that any foreign investor must join a majority Algerian partner.


Source: Jeune Afrique

 

Nigeria: Government is getting out of rural telephony

The federal government is planning to abandon the project of the National Rural Telephony Project (NRTP) due the full liberalisation of the telecommunications sector and very little government involvement. The project was intended to cover 218 local government areas in the first phase and provide over 636,256 CDMA (Code Division Multiple Access) lines in the 774 local government areas and the Federal Capital Territory (FCT). China’s ZTE Corporation, Huawei and Shangai Bell have been contracted to build the rural infrastructure, but in the end only installed local exchanges. The exchange centers that were built in six geopolitical zones are being awarded as concessions to companies that have paid for them and our role is to monitor the implementation and delivery of services to rural areas. Nigeria believes that the infrastructure in the six geopolitical zones will be better managed by external parties.


Source: www.itnewsafrica.com  

 

Mauritius: Bharat Telecoms rolls out a high-speed FTTH broadband

Bharat Telecoms is rolling out 2,900 kms of island-wide fibre network. Bharat Telecoms has invested 50 million USD. It wants to cover 70% of the population in the first phase and the other 30% in the second one. Licensed in November 2011, it has so far deployed 80 kms of its core network in a month and a half.


Source: www.businesstech.co.za   

 

Ivory Coast: 3G licences are granted

On May 7th, Ivory Coast granted the first 3G licenses. Moov, MTN and Orange Ivory Coast have each paid the $ 6 billion francs CFA for their licence which has provided 18 billion FCFA to the Ivorian government. Operators had first to complete the conditions required by the Agency for Telecommunications’ (ATCI). As a criterion, they must be up-to-date with their obligations vis-à-vis the Ivorian state. They also committed to a national coverage of 95% within 4 years.


Source: www.news.abidjan.net   

 

New mobile payment service launched by the Tunisian Post and Tunisiana

The Tunisian Post has launched, with the assistance of the operator Tunisiana, a new service for mobile payment called "Mobiflouss". This service will be available to all holders of a Tunisiana number as well as all holders of e-Dinar Smart cards, whether banked or not and even in inland areas. This is a multi-bank and multi-operator service that will allow its users mobile access to the services of e-dinar Smart cards, money transfers, payments and consultation of invoices as well as recharging Tunisiana prepaid telephones.


Source: www.lapresse.tn  

 

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Vodafone: problems in Europe but good performance on emerging markets

Vodafone has had to depreciate the value of its subsidiaries in Italy, Spain, Portugal and Greece by 4 billion pounds. However with good performances in India, Turkey and even in the United States it still shows large profits.


Times are tough for the European telecom sector and Vodafone’s accounts for 2011-2012 have confirmed that. The turnover of the British operator fell by 1.1% in Europe during the year ended 31st March 2012. Although its business in Europe is in a difficult position, European subsidiaries of Vodafone are more profitable than those in emerging countries. By contrast, the emerging markets have driven growth of the group, especially India and Turkey, which helps Vodafone to show a slight increase in overall sales (1.9%) and make an operating profit of 11.5 billion pounds (- 2.4%).

Source: Les Echos

 

Democratic Republic of Congo: funds for the optical fibre connection embezzled

During his appearance before the National Assembly, the Minister of Posts and Telecommunications has admitted that the connection of the DRC to the optical fiber is blocked following a misappropriation of $3 million for this operation.


USD 3 million were withdrawn from BIAC (International Bank for Africa in Congo) by a certain Kalala Martin holding a driver's license. The National Assembly has decided to set a commission of inquiry to get to the bottom of the case.


Source: www.balancingact-africa.com


Internet switch exchange in Congo Brazza

Jasco Congo has entered into a service partnership with Warid Congo, using the local company’s existing infrastructure and taking over operational costs and maintenance of the data centre. Jasco will design and build an Internet switch exchange and provide local Internet hosting from the Warid Telecom data centre, helping to drive down the cost of Internet access. The company will also host local telecommunications operators, providing a carrier neutral switching location for international traffic.


Source: www.telegeography.com, www.jasco.co.za


Tunisiana wins 3G and fixed licences

Following the rejection of its initial bid by the Ministry of Information and Communication Technologies (MinCom), Tunisiana (subsidiary of Qatar Telecom) has been awarded both 3G and landline operator licenses by the MinCom.


The Qatar Telecom (Qtel) subsidiary will pay TND205 million (USD131.52 million) for the licence, TND44 million higher than its earlier bid. Tunisiana has also signed an agreement with Huawei to roll out its 3G network infrastructure.


Source: www.cellular-news.com


Rural telephony in Togo

In mid-April Togo Telecom, Togocel, Moov Togo and the Minister of Telecommunications, Mrs. Cina Lawson signed an agreement on network extension to rural areas in order to provide telecommunication services at lower cost. The operation will result in the installation of 50 base stations covering around 200 isolated villages and towns. It will cost 6 billion FCFA each year equivalent to €9,15 millions, respectively 6,1 million for Togo Telecom, 1,7 million for Togocel and 1,35 for Moov.


Source: Jeune Afrique

 

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News in brief

 

Development of Orange’s m-payment services

Orange launches an m-payment service in Jordan and Mauritius. The company says that users of its Orange Money m-payment service have passed the milestone of 4 million.
Source: Total Telecom
 
France Telecom strengthens its control of Mobinil

France Telecom has increased its stake in Egyptian mobile operator ECMS (Mobinil) to 94%. Share repurchases have cost it 19 billion Egyptian pounds (2.47 billion Euros).
Source: Les Echos

 

Successful launch of AMOS -5

Launched in position 17 ° E, satellite AMOS-5 provides the services bundles capacity through pan-African C-band and Ku.
Source: Jeune Afrique

 

Afrique Telecom is opening up its capital before enter the stock market

Arkeon Management has acquired stakes in Afrique Telecom. Afrique Telecom is a French company which has so far successfully developed Internet access via satellite (VSAT) mainly for companies and institutions in Africa. Growth prospects for Afrique Telecom and its commitment to listing on the stock exchange were decisive factors for the investor.
Source: www.finactu.org

 

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Namibia and Botswana connected to West Africa Cable System

Landlocked Botswana has inaugurated its link to the West African Cable System (WACS), which was launched last month and stretches 14,900km along the west coast of Africa. Botswana partnered with neighbouring Namibia, each raising USD37.5 million to invest in a 9.2% stake in the cable consortium. Botswana Telecommunications Corporation (BTC) will co-locate services within the Swakopmund landing station operated by Telecom Namibia.
Source: www.telegeography.com  

 

WACS cable inaugurated in Togo

According to Togo Telecom, West Africa Cable System (WACS) was inaugurated yesterday with the central landing of the fibre-optic cable in Afidegnigba.
Source: www.subseaworldnews.com

 

Huawei and ZTE in Algeria sentenced for corruption

Chinese telecoms equipment vendors Huawei and ZTE are excluded from public contracts in Algeria for two years after they were found to have bribed an executive at state-owned telco Algerie Telecom.
Source: www.channelnews.fr  

 

LTE arrives in Namibia: MTC launches 4G in capita

MTC has launched commercial 4G data services over a Long Term Evolution (LTE) network covering large parts of the capital, Windhoek.
Source: www.telegeography.com  

 

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Contact Us

France Frederique Dupuis-Toubol frederique.dupuis.toubol@twobirds.com
Katia Duhamel katia.duhamel@twobirds.com  
UK Graeme Maguire graeme.maguire@twobirds.com   
Colin Long colin.long@twobirds.com  

 

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