Mahama cautions Govt on Telenor

As the government prepares to sign an agreement with Norwegian telecom giant, Telenor to take over management of the beleaguered Ghana Telecom, Mr. John Mahama, MP Bole/Bamboi and the immediate past Minister for Communications has cautioned against the lack of openness in the new take-over bid.
He took great exception to the secrecy surrounding the negotiations resulting in a situation where even high-ranking officials of the ministry of Communications and Technology are not be aware of the details of the agreement.
“The memorandum of understanding between Telenor and the government was signed about three to four months ago but as at now, (even) as a member of the Parliamentary Select Committee on Communications, I have not seen a copy of the memorandum. We made a inquiries at the ministry and nobody is willing to release anything,” Mr. Mahama said.
The Business Plan that Telenor presented to government has also not been made public and neither Parliament nor its Select Committee has been briefed.
Although there were indications that after the termination of the agreement with Telekom Malaysia, government was going for another strategic investor to take over, it is now more than obvious that Telenor has more designs for a management consultancy job than invest in it. Indeed the final documents submitted by Telenor and gleaned by the Network Herald made their position categorically clear on the issue- they are not interested in investing in Ghana Telecom, period.
With the rich experience of a former minister in charge of the sector behind him, Mr. Mahama was emphatic that “if Telenor were buying a stake in GT, then their bid to have a control in management would have been justified. But they are not coming as investors, all they are saying is give us your company to manage and you pay us.”
To him, this is not good enough because there are very competent local managers who can handle GT equally well especially considering the fact that over the last five years or so, GT has upped its human capacity resource base to adequately manage the company.
He said they (local management) have been able to reduce GT’s indebtedness to Motorola from $20 million to $5 million and also worked hard to almost settle its debts to Ericsson.
Short of screaming, “discretion is the better part of valour” he called on the sector minister and the government to exercise lots of caution when entering into the agreement in order not to repeat the mistakes of the past.
One of the mistakes in the previous government’s agreement with Telekom Malaysia was the use of Penalty Clauses to punish non-compliance with targets set in the agreement.
Our information and understanding is that government has shifted from its earlier position of insisting on Performance Bond, which is automatically activated in the event that Telenor fails to deliver on the target and has gone back to Penalty Clauses.
Penalty Clauses are enforceable only after a process of litigation. So if after three or four years Telenor is unable to meet the 400,000 broadband lines target, then the Ghanaian Government has to go through a long legal process to be able to enforce penalties.
The sector minister, Felix Owusu-Agyapong (MP) had earlier assured that government was going to execute the performance bond. “It is therefore significant and necessary that the minister explains the issues,” Mahama said.
As at now, it is not even known what the cost of the management consultancy is going to be, Mahama said adding, “it is important to know whether the agreement is worth it.”
Mr. Mahama who is also the minority spokesman on Communications is worried about the uncertainty in the industry and said the sector minister cannot escape blame. He said, there is no clear sense of direction and it is difficult to determine what will happen in the sector some two years from now.
“I have drawn attention to this uncertainty over the last one and half years or so but nothing has been done to give a clearer sense of direction to where the industry is moving.”
He called on the government to as a first step, expedite action on the divorce process between Ghana and Telekom Malaysia, give a clearer picture as to what will happen in the industry for the existing operators to know what to expect and also strengthen the regulatory body, the National Communications Authority.
Meanwhile, the paper is reliably informed that Telenor boss breezed into the country sometime last week. It looks as though, he is in town to append his signature to the agreement, but the report has not been confirmed.