A telecoms analyst and economist has raised concerns on the emergence of a dominant regional player seeking to acquire an existing telecom company in The Gambia.
In an op-ed published on his social media page, US-trained economist Nyang Njie who had worked with the government of The Gambia as well as GSM companies in the country contended that such a transaction has the potential to create a monopolistic environment that could stifle competition, impact employment rates, and reduce tax revenues.
He wrote: “It is paramount for The Gambia government to scrutinise any proposed acquisition rigorously, considering the implications it may have on local businesses and the overall economic landscape.
“The influx of foreign direct investment can be beneficial, yet the scenario of a major international player entering the market necessitates a critical evaluation of its effects on national economic sovereignty. A dominant operator with a substantial regional footprint could leverage economies of scale, undercutting local telecom providers and making them increasingly uncompetitive. Existing operators may face difficulties in maintaining their market share, which could lead to reduced employment opportunities and an eventual decline in service quality, as competition becomes less robust.
“Moreover, the telecommunication sector is governed by specific regulations intended to promote fair competition and protect local interests. The Gambia government must ensure that these regulatory frameworks are adhered to when evaluating any acquisition proposal. This involves implementing measures that protect local operators against predatory pricing and unfair competitive practices. A thorough assessment should include economic impact analyses focusing on employment trends, tax implications, and consumer welfare. The government must consider whether the proposed acquisition aligns with public policy objectives, ensuring that investments benefit the broader Gambian society rather than undermining it.
“The potential acquisition poses a risk that must not be taken lightly. While the prospect of increased foreign investment can lead to advanced infrastructure and improved services, it should not come at the expense of local operators and the economic stability of The Gambia. Proactive regulatory measures are essential to maintain a level playing field, thus safeguarding national interests and fostering a resilient and competitive telecom sector. It is vital for the government to adopt a cautious and strategic approach, ensuring that any changes in ownership within the sector serve the long-term interests of the Gambian economy,” Njie cautioned.
On 4th February, the Confederation of Gambian Industries hosted a meeting in Kololi where Senegal’s Sonatel Group discussed with stakeholders its investment directions in the country.
Sources hinted to The Standard that Sonatel is eyeing to enter the country through collaboration or acquisition of Comium. Many of the key players in the sector have echoed the concerns expressed by Mr Nyang.
