See also:
» 16.03.2010 - UK halts Kenya education aid
» 16.02.2010 - Kenya heading for a political disaster
» 15.02.2010 - Kibaki overrules PM’s decision
» 26.01.2010 - US withhold Kenya’s education aid
» 04.01.2010 - Rhino poachers arrested in Kenya
» 18.12.2009 - Union calls for resignation of education minister
» 16.12.2009 - Kibaki orders investigation into missing school funds
» 11.12.2009 - Britain bans 20 Kenyan officials

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Economy - Development | Technology

Old Kenya telecom commission "was corrupt"

afrol News, 15 March - While most telecom providers in Kenya earlier this week protested the government's decision to dissolve the Communications Commission of Kenya's (CCK) board of directors, one company today congratulated the move. The old board "had degenerated into a corrupt and self-serving institution for the individual members," the company states.

The Kenya Telecommunications Investment Group (KTIG) today congratulated Telecom Minister Raphael Tuju for disbanding the CCK board of directors. KTIG is the only 100 percent Kenyan-owned bidder for the third mobile licence and the company holds that it had been victim to the old board's corrupt decision-making processes.

The main duty of the CCK board is to regulate the communications sector and protect national interest in the sector. KTIG executive Angaluki Muaka told afrol News that the manner in which the Board handled the process leading to the licensing of the third mobile service provider was a prime example of corruption.

That tendering process began in early 2003 when the CCK Board invited tenders from all interested companies. Various companies placed bids, which were opened and three companies pre-qualified, including Econet Wireless Consortium and KTIG. "Econet placed a bid of US$ 27 million and KTIG placed one of US$ 55.5 million," Mr Muaka reveals.

The CCK Board qualified Econet's tender for the service at less than one half the bid placed by the KTIG and the country consequently lost US$ 28.5 million. "KTIG was disqualified arbitrarily on the grounds that Econet, with its failure in all countries in which it has had operations, had better technical capacity than Detecon of Germany, the technical partner for KTIG," the Kenyan company claims.

In March last year, Econet's qualification was announced and the public was invited to raise possible objections to grant a licence to the company. Several companies thus presented objections. "We informed CCK Board that the whole tendering process ... had been afflicted by corrupt practices, that the tender documents had been prepared by CCK in collaboration with Econet, that Econet had no financial or technical qualification to set up the network, that Econet had failed in the telecommunications business in all countries in which it had operations," Mr Muaka says.

The KTIG executive further claims that confidential information from the company's business plan suddenly had leaked out to other bidders. This information, Mr Muaka holds, had only been given to the CCK Board. "This situation, which only CCK could have facilitated, has caused KTIG irreparable harm and if it is representative of how CCK handles business secrets of parties applying for licenses," he adds.

At the time the Board granted the licence to Econet, Econet had been kicked out of Nigeria and denied the opportunity to buy a stake in Telikom PNG Limited, Papua New Guinea’s state owned telephone company, due to its tainted business character. Top officials of Econet were also facing criminal charges in Zimbabwe for offences of corruption and money laundering. The CCK Board did not consider all these.

- In sum, the rot within the Board had reached a level which clearly invited firm and drastic action from the Minister in charge of Information and Communication, Mr Muaka says. "The Minister needs to be congratulated for his bold decision. Those castigating the Minister are advocating for corruption," he adds.

Minister Tuju earlier this week was criticised by the Telecommunications Service Providers Association of Kenya (TESPOK), which issued a statement describing the government's decision as "totally incomprehensible". The order to dissolve had been a poorly thought out action, "The ongoing disputes within the sector, which have been prompted by the newly opened market, demand that the country have a stable, objective and level-headed regulator," TESPOK said.

- This action by the government has thrown the entire industry into disarray, TESPOK Chairman Joseph Muchero added. "The CCK Board plays such a crucial role that now no further licenses can be issued, no disputes can be settled and no formal regulatory interventions can take place and there is no clear communication from the government as to how affairs within the sector are to be managed."

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