MGI MUST NOT BE STRANGE BED FELLOWS WITH THE GOVERNMENT OF THE GAMBIA

The Americans are fond of saying “If it ain’t broke, don’t fix it”. This age-old adage holds true for things that are normal and in order. The Gambian telecommunication policy framework is not in order and it is in need of dire attention and fixing. Telecommunication is a vital conduit for the development aspiration of any country. What we have been witnessing in the Gambia over the past 7 years as it relates to the mismanagement of our telecommunication industry especially our international gateway is not only a cause for concern, but a degradation of economic value that is going unabated in the telecom sector. The advent of the Africa Coast to Europe Cable (ACE) gave industry participants hope that the industry would be sanitized once and for all for the benefit of the subscribers of telephony services and the investors vested in the sector. These hopes were dashed as the previous regime of Jammeh plundered our national resource thereby rendering Telcos ineffective. Fast forward to December 2nd 2016, Gambians thought they had a new lease on life and the transactional nature of auctioning off our telecommunication infrastructure (Gateway) to the highest bidder would have been a thing of the past. The operators of telephony services and data providers were poised to see a liberal market where competition is rife. A series of meetings were convened by stakeholders in the sector and public policy practitioners to remediate the ills of the sector particularly that of liberalizing the sector without impeding on the operators wishes as per how to conduct their business. There was an overwhelming consensus to issue Gateway licenses to all operators and initiate a Gate Keeper arrangement to monitor all traffic inbound and outbound from the operators. 

This initiative has fallen on deaf ears with the issuance of a letter from the Office of the President (PR/C/676/Vol. 8(41-HSB) dated 11th April, 2018 bearing the caption Immediate Reinstatement of MGI’s Contract For The Exclusive Managenent of GAMTEL’S International Voice Gateway. Fundamentally, the contents contained therein in the correspondence stated above is validating the following;
1. A flawed contract signed before the coming of the present administration whose contents placed the Gambia at a disadvantage relative to the other party MGI must not be revisited for consideration nor accepted as an alternative. The same terms and conditions that led us to the fiasco/mess we find ourselves with MGI cannot be upheld by the executive or any other branch of government as the interest of the greater good MUST always be safe guarded.

2. The dates of the effectiveness of the contracts is not in line with the dates stated on the letter dated 11th April 2018 from the office of the President as the date of effectiveness of the MGI contract. The dates in question have a financial ramification and choosing a different date puts MGI in a better financial position relative to the Government of the Gambia. Based on clear evidence and instruments signed by MGI and the then MD of Gamtel Mr. Sanyang, the contract was signed the 1st day of June, 2014 contrary to the reported date of 31st December 2014 as per the letter from the Office of the President.  According to the contract MGI was to receive USD 600,000 monthly from the effective date until 31st December 2014. Thereafter, they were to receive USD 800,000 a month for the remainder of the contract. This amount were to be deducted from the total monies collected and the Government of the Gambia will bear all cost associated with making a call, billing the international carries, paying the staff associated with the operation and all other equipment or spare parts to be consumed by the project. This in itself was a bad deal but to make matters worse, MGI were to receive 40% of any additional revenue if the Gateway makes 5 Million dollars or 14 million minutes. Clause VI. On page 9 of the Contract was a clear rip off to the people of the Gambia because MGI was making free money without any effort to warrant such a reward. Furthermore, the contract explicitly stated that the revenues from the international gateway will cover all operational expenses associated with the Gateway.

3. The contract herein mentioned, is under review and scrutiny at the ongoing Janneh commission. Therefore, operationalizing it will be in breach of the good faith efforts being made by the commission to ascertain the validity of the said contract.

4. The decision of the Office of the President to bypass all relevant stakeholders (PURA, Ministry of Finance, Ministry of Telecoms and Justice) for consultations prior to the conveyance of approval for MGI to kick start their operations contravenes global best practice as it relates to public governance.

5. Based on the preamble on the first paragraph of the contract between the Government of the Gambia and MGI, it is stated that the government of the Gambia was represented by the Office of the President (Jammeh Administration). This once again was a fallacy as the contract was signed by Mr. Baboucarr Jatta the former MD of GAMTEL who is neither an official of the Office of the President at the time, nor a staff of the Government of the Gambia as he was a staff of a public enterprise owned by the Government of the Gambia. This anomaly once again puts the validity of the said contract to question.

6. Item 8 under the definition of OPEX (operational expenditure) states that Government shall pay for all fees and Social responsibilities carried out by MGI are at the expense of the gateway project. This is purely daylight robbery an including Social services or other contributions to the state. This implies that Corporate social responsibility projects must be borne by the state.


Going forward, the Government of the Gambia must adopt a comprehensive approach to fixing the festering ailment associated with the Gambian gateway.  The government MUST accept the notion of liberalization and kick start the process with immediate effect by transitioning from the status quo. This transitional period must not EXCEED 6 MONTHS. The following prerequisites must be adopted before the liberalization of the sector in order to avoid market chaos and unfair market positioning or the abuse of dominant market power.

1. Telecom Operators (GSM Companies) must first and foremost approach the sector in a holistic manner and not focus on the competitive nature of the business.
i. They need to work closely to usher guidelines and rules of engagement that will enhance the value proposition of the market and also promote price stability in order not to destroy value through tariff wars. Tariff wars will only give an edge to the subscribers in the short term but the loss in margin will make reinvestment of capital expenditure in the sector difficult thereby compromising service delivery mechanisms in the medium term difficult.

ii. The Operators must have a preexisting arrangement with the Public Regulator (PURA) for the issuance of their licenses once the transitional period with Gamtel expires. This will allow a seamless transition from the interim arrange to a full fledge liberalized market. The licensing regime must not be an undue burden to the operators and ideally, the regulator can augment the existing GSM license to a unified license thereby covering all aspects of the telecommunication business process.

iii. The sector must agree on the imposition of a price floor for all outbound and inbound international calls. This will reduce the incidence of price wars and heavy handed market positioning by operators.

iv. The operators must individually calculate the economic loss incurred by the operators by way of the MGI contract with the government. A demand note must be presented to government to recover all losses associated with the MGI contract.

2. The Government of the Gambia must be committed to the liberalization track by supporting the process in good faith. It is the responsibility of the state to protect the interest of the greater good at all times and this includes the termination of the MGI contract because it goes against the grain of our strategic national interest and good governance. The government of the Gambia being the custodian/party to the MGI contract must endeavor to do the following; 
           i. Terminate/Rescind the arrangement with MGI forthwith
  ii. Facilitate the recoveries of all financial losses due to the operators
iii. Work with PURA and Operators to institute a competitive tariff for destination Gambia including a price floor to avert price war amongst operators
iv. Pursue legal action against MGI and government officials who are found culpable in the MGI arrangement
vi. Establish a gatekeeper arrangement through a clearinghouse model to ensure revenue assurance for government and illegal sim box connections and by passes

3. The Regulator PURA is vital in the transition and final liberalization process of the telecommunication sector. The erosion of confidence by the operators and the general public on the efficacy of PURA as an effective regulator must be rebuild. This perception is bolstered by the constant circumvention of PURA by would be investors in the sector who are knocking on wrong doors to achieve their economic interest. Therefore, the following actions must be undertaken by the regulator to not only sanitize the sector but protect the esteem Gambian subscribers from poor service quality and excessive pricing models.

i. Facilitate the acquisition of gateway licenses to all operators without undue bureaucratic hurdles
ii. Enforce a price floor mechanism for international call tariffs
iii. Monitor and ensure quality of service delivery and promote fair play and competition amongst operators. 
In conclusion, I am of the view that it is to the national interest to not only sanitize the sector but accord Gambians with international best practices for services delivered to the general public especially that of telephony services. I do hope that the vested parties adhere to the stringent guidelines listed above in furtherance of a buoyant telecommunication sector. I also implore on the Gambian authorities to take the telecommunication sector seriously as the next generation of economic service delivery will be anchored on digital platforms which will rely heavily on data provision and telephony services. What we have witnessed in the past few days regarding the reinstatement of the MGI contract negates all economic and legal interest of the Gambia.