Expanding telecom horizons in Ghana

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Mobile telephony is one of the most dynamic sectors in Africa, offering a lifeline to millions of rural dwellers and rapidly transforming all aspects of society.

Ghana’s impressive development and growth since the mid-1980s has made it one of the strongest performers in Africa. The country boasts more than twice the per capita output of the poorer countries in West Africa and one of the most highly developed education systems in the region, despite the fact that almost one-half of its 24 million people live in rural areas, 27 percent of them below the poverty line.

This strong performance has triggered an increase in foreign direct investment, including to the telecommunications sector.

Through text messaging and the use of apps, mobile telephony has transformed Africa in many ways. In a population of one billion, there are reportedly 695 million subscribers. In sub-Saharan Africa, for example, only one in five adults has a bank account, but thanks to a banking app, many people are able to use mobile phones to pay bills and to access calling plans, buy food, make payments, and send money to relatives abroad.

Other areas in which mobile telephone use has created innovations are activism, education, disaster relief and agriculture. Acting as a platform for sharing weather information, market prices, and subsidies, for instance, mobile phones have enabled African farmers to make more informed decisions, and in the process, increase their earning potential.

Combining needs with technology, it was a Ghanaian, Bright Simmons who, abandoning astrophysics and political studies, turned entrepreneur to introduce a revolutionary use of mobile communication to the health sector. His innovative idea – to put a code on all medicine packaging – has helped to foster a healthier Ghana. Through the use of a mobile phone app, consumers can scan the code to check the authenticity of the medicine and access information about it.

This innovative but simple tool is saving countless lives. Data provided by the World Health Organization estimates that counterfeit medicines account for 30 percent of all medicine sales, daily killing up to 2,000 people worldwide, though other studies suggest the figure is even higher. The Simmons’ model is being extended to India and South Asia to help create, as Simmons himself has said, “a genuine reversal of the usual narrative.”

Increasing coverage

In 2009, Zain Communication Ghana received a US$20m private sector loan from OFID to support the construction and operation of a greenfield telecom network. At that time, Zain was the fourth largest mobile operator in the world in terms of geographical presence, with operations in 15 African and seven Middle Eastern countries.

Zain was the first company in Ghana to operate a 3.5G network, offering ultra-high speed Internet access that would allow customers to make video calls and use multimedia content. Another advantage was its “borderless” service that offered free roaming in other Zain networks, including in neighboring Burkina Faso, Niger and Nigeria.

Tareq Alnassar, Acting Head of OFID’s Private Sector Operations, explains how the project improved the availability of reliable and affordable communications for consumers and businesses. “It enhanced competition in the sector, leading existing mobile operators to invest further in their networks, thereby increasing availability and improving the quality of cellular services and lowering tariffs. Also, the project increased geographic and population coverage.”

According to Alnassar, the mobile market in Ghana is huge, with over 10 million customers, and is projected to grow at average rate of 28 percent per annum. Zain Ghana, which today operates under the name of Airtel Ghana following a takeover deal in 2010, holds 16 percent of a market it shares with five other mobile operators. Explains Alnassar: “The mobile industry is highly competitive and the market is characterized by aggressive and huge marketing spend.”

Ghana continues to develop its infrastructure to enhance access to information and communications technology in general, and to increase access to telephones in rural communities in particular.