Tax burden, increase operational cost on MNOs: Thousands of Sierra Leoneans risk losing their jobs

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By Alhaji Haruna Sani

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With the exponential increase in operations cost, Mobile Network Operators (MNOs) in Sierra Leone have noted that, if their cry to review tariff is not adhered to, they will be left with no option, but to scale down operations and investment, which will pose a serious economic hardship than what is  currently  felt in the country.

“I would like to emphasize on the criticality and the urgency to salvage our cry for tariff review or else we would be left with the only option of scaling down our operations and investment. This will pose serious economic hardship than what is presently felt. We therefore call for the urgent intervention of our regulatory stakeholders as our ability to further invest in Sierra Leone is dependent on resolving our prevailing challenges”.

In their feedback at the Media CSO retreat on November 26, the MNOs said their sector has created jobs for over100, 000 Sierra Leoneans with direct and indirect employment and they remain a strong pillar of Corporate Social Responsibility (CRS) and sponsorships in the country.

Mobile Network Operators which includes the two biggest networks (Orange and Africell) informed the press that since the last tariff adjustment in 2017, the combined increase on key cost variables presently stands at an alarming rate of 698%.

In their joint statement, the mobile network operators highlighted several factors that were alarmingly causing serious setback on their investment. Those factors they said, included increase in foreign exchange against the Leones, increase in fuel cost, cost of electricity tariff, cost of internet (zoodlabs, cost of Terrestrial Fibre (Leonecom) cost of site construction materials (steel and cement),among others.

The MNOs said there has been increase of 148% since the last GSM tariff changed in 2017 when the exchange rate was Le 7,258 (old Leones) to $1, which is currently at Le 18,000 (old Leones) to $1.They said fuel cost which was Le 6,000 in 2017 is now sold at Le 25,000 (old Leones) for bulk litres and electricity tariff facing significant increase of 78% from Le 1,890 (old Leones) to Le 3,364 as at July 2022.

“Previously, the cost of internet (zoodlabs) 1 Mbps was $ 8, today it is $13 per GB recording 63% increase and continue to increase when the Leones value of the USD increases. While the cost of cement per bag and steel per ton were Le 65,000 and Le 6,000,000 in the past, they presently stand at Le 145,000 and Le 11,500,000 respectively accounting for 92% increase. Inflation as at today stands at 30% and could increase further in the future”.

The MNOs said although they have struggled to absorb those increases over the years, the prevailing challenges were stifling business; a situation which they said was no longer sustainable.

They went on to state that their tariff remains  stagnated whilst all other businesses have the freehand to increase their costs reflexive of inflation and the devaluation of the Leone against the USD and other international currencies.

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