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Government's Divestiture Situation, a Case for Sober Reflection

Aug 4, 2008, 5:40 AM

The non-renewal of the 'part ownership' contract to Spectrum Company, the Lebanese-owned company that bought half the shares of The Gambia's telephone and cellular companies, Gamtel and Gamcel, in August 2007, is perhaps one of the most telling signs of the failure of the attempts so far made towards the divestiture of Gambian public enterprises. Given complaints making rounds in the grapevine with regards to the fall in service standards of the two companies, the decision by government could be termed judicious, even if the immediate and actual motive is yet unclear.

It is noteworthy that one of the aims of any divestiture programme is to attract much-needed foreign direct investment into a country with a view to boosting the growth of the economy. However this aim is best advanced if such investment also seeks to enhance standards of service delivery while ensuring profit maximisation for the government and, by extension, the taxpayer. Whilst facts are not available to this paper as to the gains or losses made by the two companies under the management of Spectrum Company in the past year since August 2007, it is deductible that the non-renewal of the contract is suggestive of a malaise of some sort on the part of the new management.

It is interesting to note that while in the case of Gamtel and Gamcel, Spectrum is said to have bought 50 per cent of the shares, in the case of Gambia International Airlines, a company that made pre-tax losses of a staggering D84 M, there is no indication, as far as we know, of how much of the shares had been bought by GS Aviation, a so-called European Airline Operator that had been granted an initial five-year Management Contract. Why can't the same be done with the GS Aviation contract? If is it because of the duration of the contract, which is supposed to be for five years initially, we call on government to exercise extra caution in the award of such contracts as parties to contracts could default on their obligations and when this happens the best thing to do is to review the contract in question without fetters.

Having said that we would like to take this opportunity to urge the new management(s) of Gamtel and Gamcel to look into the expansion of the local network to give people more access to land phones. They need to improve the International Gateway, to which there is not enough access. Land phone lines should be installed in both rural and urban areas of The Gambia. People have their telephone lines interrupted for long periods and in most cases, the technicians would use the lack of enough vehicles and parts as an excuse. The services of 131 and 155 are very poor.

More importantly, all Gamtel and Gamcel staff who were sacked after the joint partnership with Spectrum Company should have their cases reviewed. Among them, there are good technicians that both Gamtel and Gamcel cannot afford to lose after spending huge amounts of money in their overseas training.

With the state of deterioration, one cannot help but reflect with nostalgia on the good old days under the management of Mr. Bakary Njie, when every Gambian was proud of Gamtel because of its leadership in telecommunication, making the country's telecommunications services one of the best in Africa then. But now, we have seen the services of the company deteriorating, bills coming very late, the network for both telephones and Internet getting poorer.

Also as a matter of course, the new management should reinforce its personnel training, development and motivation programmes with a view to creating the requisite environment for efficient and effective delivery.

"We have always known that heedless self-interest was bad morals; we know now that it is bad economics."

Franklin Roosevelt