AFRICA: ITU Reports Weak Performance of Telecommunications

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IPS Correspondents

GENEVA, May 2 1996 (IPS) - The telecommunications sector in Africa showed little improvement in 1996, and the number of phone lines per inhabitant dropped, the International Telecommunications Union (ITU) reported Thursday.

Although the number of telephone lines grew in absolute terms, access to basic telecommunications services did not improve.

‘Line penetration’ — a standard measure of telecommunications development — stands at well below one line per 100 population; less than two percent of the world’s telephone lines lie in the region; and some three-fourths of all Africans will, on present figures, never get the chance to make or receive a phone call.

In fact during 1995 nine African countries saw a drop in the number of lines per inhabitant, and the rest of the region showed only slight improvement.

That contrasts with the significant growth seen in other developing regions during the same period. Nevertheless, the ITU was more optimistic on the recent opening up of the South African market, able to spread its services to the rest of the continent.

The 1996 Telecommunications Indicators from Africa report will be presented by the ITU at the Conference on African Regional Development, to be held May 6-10 in Ivory Coast.

Growth in infrastructure in the 1990-95 period was modest, although the sector’s participation in the overall regional economy improved. Telecommunications infrastructure accounted for 1.4 percent of the region’s Gross Domestic Product (GDP) in 1990.

That proportion rose to two percent in 1993, but fell to 1.7 percent in 1994, largely due to the devaluation of the CFA (African Financial Community) franc in francophone Africa.

However the growth of investment in the telecommunications sector seen in the region in the early 1990s was not sustained and was followed by a 19 percent drop in 1994.

But the report noted that around 60 percent of that investment came from self-financing, a high proportion compared to other developing regions, and an indication that some countries in the area are moving towards self-sufficiency.

The ITU report indicates that the sector is currently going through a process of restructuring. Telecommunications have been separated from postal services, regulatory entities have been created, and in some countries public operators are being privatised and competition is being introduced in certain markets.

The mobile (cellular) phone sector, which has seen explosive growth in Asia and Latin America, is now beginning to expand in Africa. In 1995, some 23 African countries had cell-phone systems. South Africa showed the greatest growth, beginning with the launching of the digital GSM system in 1994.

Development of the sector in the rest of the continent was limited by the cost of handsets in sub-Saharan Africa, and security problems in North Africa.

The sector is one of the few in the regional market that have been thrown open to private investment and competition.

Ghana already has a second private operator for basic telecom services; Zambia, Ivory Coast, Senegal and Congo are planning at least partial privatisation of their telephone companies; and Guinea is already offering 49 percent of its national operator, according to the Massachusetts-based consultancy Pyramid Research.

While no African nation could currently afford levels such as those seen and used in Western Europe, where there are some 50 to 70 lines per 100 population — Zaire, for example, has just nine lines per 10,000 people — five to 10 lines per 100 is seen by analysts as economically viable even in the short term.

One potential source of funding for Africa may come in the form of investment from WorldTel, a public-private partnership touted by the ITU. The group would focus on specific telecommunications projects in developing nations that take concrete steps toward liberalisation of communications and foreign investment laws.

Furthermore, a half-dozen projects are underway to provide high- capacity networks that would span the continent. One, a pan- African satellite called Rascom, was seeking 180 million dollars in finance to launch a satellite in 1997.

South African network operators are looking into expanding its ties with surrounding nations. And U.S. telecommunications giant AT&T is proposing an undersea fibre-optic cable that would ring the continent.

The spread of the Internet in Africa has been slow. Sixteen countries were connected by 1995. The majority of users are universities and members of the private business sector.

The lion’s share of African Internet users are in South Africa, which figures among the world’s top 20 countries in terms of density of users.

Subscription television is expanding in Africa. Demand for subscriptions has remained steady in spite of the cost being much higher than that of basic telephone services.

The most active markets in terms of subscription television is again South Africa, which launched M-Net, the first such network in the southern hemisphere, and Nigeria, which now has 15 operators of a microwave distribution system.