A $20 million telecoms investment stalls at MOICI
Business: Monday 7 September | Tech
Revealed: $20 million telecoms investment stalls at Gambia Ministry of Information and Communication Infrastructure (MOICI)
A $20 million telecoms investment to provide affordable and reliable fixed line broadband internet services up and down the county is allegedly being blocked by the Gambian Ministry of Information and Communication Infrastructure for perceived fear of Gamtel being made redundant in the ISP sector if plans of XOOM Wireless, backed by Sonatel are implemented in The Gambia.
XOOM Wireless, a start-up Internet Service Provider (ISP) founded by Kalifa M Faal, CEO of Gambian IT firm KMF Technologies, set up to bridge the gap in fixed line internet connectivity in The Gambia, attracted a $20 million investment and partnership from Sonatel of Senegal and an agreement between the two companies was signed on 4th April 2019. The partnership, and Sonatel’s investment in XOOM Wireless is expected to create over 500 new jobs, increase the internet penetration rate by 15 percent over a five year period while offering reliable and affordable internet connectivity to Gambians in both private and business settings according to the company's business plan. Sonatel’s proposed investment into XOOM Wireless meant that the company’s existing ISP licence would need to be transferred due to the significant change in the share holding structure as a result of the new investment.
In the partnership agreement, Sonatel acquired 91.6% stake in XOOM Wireless. The acquisition was done in partnership with Senegal based venture capital firm,Teranga Capital who also took a minority stake in the Gambian ISP. Sonatel which is part of the Orange Group and also active in the telecoms sectors of Mali, Guinea Conakry, Guinea Bissau and Sierra Leone said at the time of XOOM Wireless acquisition that it is consolidating its telecoms presence in West Africa. Consequently, XOOM Wireless applied for the transfer of their ISP licence in June 2019 which will enable Sonatel to invest the $20 million estimated to build the fixed line broadband infrastructure such as base stations off the existing Gamtel fibre backbone into private homes and businesses.The ISP licence transfer application is yet to be approved by the Gambian Telecoms ministry. The Gambia ICT Act 2009 provided for the ministry to decide on such applications within 90 days (3 months).
Fast forward to September 2020, some fifteen months after the ISP licence transfer application was made, it has not been approved or rejected by the Ministry of Information and Communication Infrastructure. Now this begs the question: Why has this ISP licence application which could potentially increase the country’s fixed line broadband internet penetration from a paltry 3 percent to a level seen in most countries in Africa of mid 20 percent?
However, industry insiders believe that Orange, through Sonatel has taken an unusual route of buying a Gambian company with only an ISP license to its name in order to enter the Gambian telecoms market. The normal route would be to buy an existing telecoms operator or simply pay for a license directly and invest in the sector. Furthermore, some Gambians have expressed concern that Sonatel’s acquisition of XOOM Wireless would effectively handover Gambia’s ISP sector to Senegal and that XOOM was simply being used as a backdoor entry point, perhaps all the more reason Gambian authorities are stalling on the approval of the ISP licence transfer application from XOOM. But these fears were dismissed and denied by Kalifa M Faal, the young entrepreneur behind XOOM Wireless in an exclusive interview with The Chronicle in April last year. His words: “If you look at the global market and around the world, the trend is that you partner with people to get projects done. For us, our goal was to implement our project and to connect our people. I was never used.” What we know Public Utilities Regulatory Authority (PURA) and Gambia Competitions Commission have reviewed the XOOM Wireless / Sonatel partnership and transfer of XOOM’s existing ISP licence application and have made recommendations to MOICI to approve the transfer application. According to a letter written to the MOICI Permanant Secretary on 12th September 2019, PURA encouraged the ministry to approve the licence transfer as the applicant (XOOM Wireless) has satisfied the criteria stipulated by the ICT Act 2009. So why hasn’t MOICI approve or even reject the application 12 months on following the application and recommendation from PURA? As we investigate this scandal, GunjurOnline made several calls to MOICI’s Director of ICT, Amadou Nyang, Permanent Secretary, Amie Njie, and Hon. Minister, Ebrima Sillah. All calls were unanswered.
For the interest of fair and balanced reporting, our enquiry messages were also sent to the WhatsApp numbers of all three top officials of MOICI, as well as through the contact form of MOICI website, Both the Permanet Secretary and Director of ICT have read the WhatsApp messages we sent them, but has not responded up to the time of publication of this story. The minister hasn’t read the message or may have WhatsApp “Read receipts” turned off! Below are the questions sent to MOICI: 1. Why hasn’t the application been approved/rejected within the prescribed 90 days? 2. What is holding MOICI from approving/rejecting the licence transfer application of XOOM Wireless? 3. Why has there been total silence and no response to letters written to the ministry from XOOM Wireless regarding the progress of the licence transfer application?
Gambia needs private sector investment which will not only create jobs for Gambians but will also provide competitition between Service providers so that consumers can receive affordable and reliable services. This is critical especially in the ICT/ISP sector where the country continue to experience abysmal connectivity services, particularly in fixed line broadband internet connectivity from Kartong to Koina.
There has been no response received from our enquires from MOICI as we published this piece.