Security organs have in the past weeks taken bold steps to interrogate and deport some executives at the telecom giant, MTN Uganda.
These telecom officials including their chief executive officer, have been accused of grave offences, including threatening national security.
The move comes at the time technologies businesses are coming of age in the country, and the state is still learning the ropes on how to control the fast-growing sector.
Information and Telecommunications Technology (ICT) has increasingly become the backbone for the development of the financial services, telecommunications, public financial management and scientific research and innovation and e-Government, at least, according to the finance minister Matia Kasaija in one of his budget speeches.
He was spot on.
The ICT sector is also increasing its share of contribution to the national coffers, providing 2.5 per cent of GDP (2015), employs approximately 1.3 million Ugandans and raised Shs484.4 billion in tax revenue collection in 2015.
Almost 24.8 million or 70.9 per cent of Ugandans own mobile phones, according to the 2018 report by the National Information Technology Authority Uganda (NITA-U).
The ICT sector has expanded coverage and high-speed broadband services have come from 512 Kilobytes per second to 4 Megabytes per second and 30Mbps for rural and urban households respectively.
The National Backbone Infrastructure (NBI) has also extended to cover West Nile and Karamoja Regions under the Regional Communication Infrastructure Project, with support from the World Bank.
MTN Uganda, as the biggest company in the country, has therefore a duty to practice the best corporate governance standards. Nothing less is expected.
In its statements since the deportation of its first officials, the company has insisted on remaining law abiding. However, that security agents maintain MTN officials remain a security threat to Uganda, should not be taken lightly.
They must have good grounds not to believe them.
With some local officials quizzed including MTN Uganda chairman Charles Mbiire, this investigation has far-reaching consequences.
Ugandan security should be applauded for firmly dealing with the situation. No wonder, President Museveni was recently quoted appreciating the security organs for a job well done, while meeting the UPDF high command at State House, Entebbe.
At the time warfare tactics have changed frontlines, deportations of the telecom giant’s employees was a diplomatic maneuver to avoid attracting bad press against the country. Otherwise, some of these officials should be in jail, given the enormity of the accusations against them.
The country waits to see what security is going to do with Ugandans who have been part of the project, the security organs have flagged and started dealing with it decisively.
For MTN, these allegations are likely to reverberate in the 15 countries across Africa where they operate. It should be giving security organs in those countries’ food for thought, to examine how this company has been doing its business.
With tech companies operating in a new space, most countries fall behind in their capacity to regulate and reign in telecoms. It takes some level of expertise to be able to evaluate the telecom’s misdoings, yet, they are controlling a big stake in the country, including money, data and intelligence on citizens. No wonder, you might find telecom companies might be having more intelligence on the country than the state, which would rather be absurd and therefore, give the telcos an upper hand in the affairs of the country.
The operation at MTN Uganda could have come as a surprise to many given the fact that for the last 20 years the company has not found itself in such a position.
If the firm had, however, listened to the President and took heed his words in the 2016 state of nation address, they would not be finding themselves in this quagmire.
In his 2016 state of national address, President Yoweri Museveni said government will acquire the latest communication equipment to end what he termed rampant tax evasion and corruption within telecom companies in Uganda.
Mr Museveni, who usually buys his time to allow people or organization change their modus operandi, if it was not aligned, said, an estimate indicated that the country was losing up to $400m (sh1.2 trillion) in tax per year.
“There is still tax evasion among the telecom companies,” Museveni said.
“The telephone companies have been evading tax. They make 3 million calls from outside, but declare only half of it and all the money is hidden.”
As a matter of fact, telecoms were “self-declaring” to the sector regulator, Uganda Communications Commission (UCC) since they started operating in Uganda, thus they had an opportunity to be transparent or cover up. UCC and the Uganda Revenue Authority (URA) were therefore levying fees and taxes based on what the telecoms declared.
Through his intelligence, Mr Museveni said he knew telecoms were cheating Ugandans and he warned he would catch them.
“We have made an arrangement to buy high capacity equipment to trace all the calls that come in. It will be under a public private partnership (PPP) since we did not have all the money to buy it. This issue was brought to the last parliament but was not explained well.”
“I think there was also lobbying by the telecom companies” when the issue came to parliament, he said.
The technology called Intelligent Network Monitoring/verification System (INMS), was procured and expected to enable the country monitor the volume and billing of voice and data traffic of telecoms.
It is upon that information gathered over the last two years that Mr Museveni put his feet down and demanded that MTN license would not be renewed unless they agreed to go public or leave more money into the economy.
Even with their under declarations, MTN has been raking in billions and billions of shillings, most of it ending up out of the country.
For example, last August, MTN Uganda declared, MTN Uganda’s half year revenue had expanded by 8.8% to Shs734.4bn with the growth registered on the growth of data revenue and Mobile Money revenue, which the company said exceeded their expectations.
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