Gambia's Gamcel seeks urgent government bailout
Published on 10th June 2019
State-owned mobile operator Gamcel is seeking an urgent injection of capital from government in order to upgrade its infrastructure and stabilise its network.
Addressing the Committee on Public Enterprises within Gambia's National Assembly Gamcel chief executive officer Elizabeth Johnson said the bailout is critical to sustain the company's operations.
Johnson revealed the company is struggling with "serious financial constraints" as reflected by the limitation of its offering to 2G and its inability to compete favourably in the market.
"While many telecom operators have already deployed 3G and 4G throughout the country, Gamcel currently operates a more 2G than 3G telecom network," she said.
Johnson added: "The billing system has adverse limitations and continues to limit the company's ability to maximise revenue generation as it can only provide basic voice services. The dynamics of the industry has gone beyond voice services."
Due to its low investment, Johnson said the company's revenue has been badly hit, she continued.
"Gamcel's revenue continues to fall. And the survival of the company that competes with Africell, Comium and Qcell is seriously endangered."
The company's troubles started when the government terminated the contract with MGI that was managing the International Voice Gateway Cable. This action affected Gamcel's billing system.
"In order to make sure our customers enjoy interrupted communication services to retain them, management offered free on net calls, Gamcel to Gamcel, during this period. This situation resulted in a massive loss of revenue to the company. Prior to the problem, Gamcel was making daily sales averaging 1.5 million dalasis. But the period of the shutdown, the sales drop below five hundred thousand dalasis (D500, 000) and the trend is still the same today," Johnson said.