EGYPT:
Nascent Activism Scores Rare Win
Emad Mekay
In a rare show of resistance against commercial interests, a newly formed group of anti-corporate globalisation activists in Egypt has forced two of the world's largest mobile phone companies to back down on recent prices hikes.
WASHINGTON, Feb 24 (IPS) -
The Citizens Rights Committee, a month-old group of labour activists, journalists, lawyers and consumers, called on customers of the two companies to boycott their services for 24 hours to protest a hike in prices.
The committee had warned in mid-January that if its one-day boycott did not prove strong enough to force a rollback of prices, it would increase the action to one week and even one month, if necessary.
The group also called on the government of Egyptian President Hosni Mubarak to quickly issue a decision prohibiting monopoly practices, and to set up a third firm to break the monopoly of the two mobile operators.
The moves are particularly noteworthy because the campaign happened in a country suffering under an undemocratic regime that is intolerant of activism or criticism of its market-based economic programme.
Ahmed Taha, secretary general of the Citizens Rights Committee, told IPS in a phone interview from Cairo that in the first few hours of the boycott some 20,000 subscribers turned off their mobile phones in protest, although the mainstream state-owned newspapers, which have hefty advertising accounts with the two companies, ignored the boycott call.
Taha said the activists relied on mass email messages and word of mouth to get their campaign rolling, while the Egyptian Press Union, a relatively independent body, loaned the group a place to meet and organise.
After the brief boycott, the companies backed down and said they were immediately revoking the price increases but only as a "temporary measure".
Egypt, the world's largest Arab nation with a sizeable consumer base of 72 million people, has only two mobile phone operators that count some 5.8 million subscribers, a number industry figures say could double in a few years.
Vodafone Egypt is owned by British giant Vodafone, while the second and older network, MobiNil, is held primarily by local corporate giant the Orascom Group, owned by Egypt's wealthy Sawiris family.
Onsi Sawiris, a member of the country's Christian Coptic minority, is the only Egyptian man to make the 'Forbes' magazine list of the world's richest people. The other partner in MobiNil is the Orange Group, a subsidiary of France Telecom.
Vodafone Egypt and MobiNil reportedly used their financial muscle in May 2003, paying the Egyptian government a fee to delay, and later cancel, the entry of a third network into the highly lucrative mobile phone market.
Mubarak himself rushed a two billion Egyptian pound (340 million U.S. dollars) deal between Telecom Egypt (TE), the country's state-owned telephone monopoly and the two mobile operators.
According to press reports at the time, Mubarak, whose regime is notorious for cronyism and favouritism, justified his high-level intervention on the basis that a viability study was required before a third network could be introduced.
The deal between the mobile firms and the corruption-tainted government not only postponed the arrival of a third operator that could threaten their market share but will in the future restrict use of the 1800 Mhz spectrum.
The band, which provides better reception for mobile phones, especially in Egypt's crowded areas, has now been reserved for Vodafone Egypt and MobiNil.
The move effectively cuts out competition, since aspirants will know that they will not be able to compete effectively on the lower-quality 900 Mhz band.
What prompted the activists' campaign was the companies' decision late last year to work together to raise the fees of their pre-paid subscription service. Pre-paid users constitute some 80 percent of Egypt's mobile customers.
Coinciding with across the board price increases, the angry consumers, who tend to be poor and use their phones only when necessary, formed the committee.
"I thought the two companies would compete to please me as a consumer," said Ahmed Taha. "Instead, the two companies colluded to cheat us all."
Taha said recent moves to liberalise the economy, by allowing foreign multinationals to operate locally for instance, are being done in a frenzied and disorganised manner.
Egypt has been implementing an economic liberalisation programme since the late 1980s, under the auspices of the International Monetary Fund (IMF) and the World Bank and encouraged by the United States and the European Union, whose companies have mostly benefited from working in the previously closed market.
The programme has led to price hikes for most services, of consumer products and sales of previously state-owned enterprises.
"We opposed capitalism," Ahmed Taha said. "But now, we are even striving for some of the consumer protection mechanisms that work in the capitalist system to be implemented. This is much worse than capitalism. We want some order, not this chaos."
(END/2004)
