NITEL: ANOTHER WHIFF OF CONTROVERSY
Possibly no other government-owned enterprise has attracted as much public interest and controversy as the numerous attempts to privatise the nation's first and biggest carrier, the Nigerian Telecommunications (NITEL) Plc. Only recently, in the fourth attempt in ten years, the Bureau for Public Enterprises (BPE) announced that its bidding process organised at the Abuja Sheraton Hotel and Towers has produced an investor called New Generation Telecommunications.
It is a consortium allegedly made up of GiCell Wireless Limited, China Unicom (Hong Kong) Limited and Minerva Group. The consortium reportedly offered to pay about N350 billion (or $2.3 billion) for all the components of NITEL. These include the Mobile unit, M-tel, the CDMA network, transmission backbone, the fixed line and Satellite-3, otherwise called Sat-3.
But fresh worries have emerged following the denial by China Unicom that it was involved in the bidding process. Unicom is China's second largest telecom firm.
Subject to ratification by the National Council on Privatisation (NCP), New Generation Telecommunications, in which some prominent but undisclosed Nigerians are said to have interests, is expected to pay 30 percent of the purchase sum within ten calendar days of NCP's approval. Other companies which participated in the bidding process are Omen International Limited, Brymedia Consortium and AFZ Consortium. Globacom, an indigenous telecom giant, was disqualified from the process, because according to Nigerian Communications Commission (NCC) existing operators were not allowed to take part. This, it said, was to avoid a monopoly in the sector.
Admittedly, for many years, NITEL has been the 'sick baby' of communications in Nigeria. It is plagued by a myriad of problems which include high level mismanagement and inept leadership. Three previous attempts to sell it did not pull through. For instance, in 2001, a UK based firm, ILL Limited which offered to pay $1.3 billion failed to meet up with payment schedules, resulting in the termination of the deal. Other deals with Pentascope and Transnational Corporation (Transcorp) went sour, all adding to the tortuous and botched attempts to privatise the national carrier.
Taken together, NITEL has become a national embarrassment of sorts, with a baggage of liabilities that made payment of salaries of its staff extremely difficult. It is, therefore, heartening that BPE may have finally found a new investor. We want to believe that the successful investors know what they are putting their money into. This is vital because past attempts to sell NITEL collapsed principally because all the necessary business angles were not taken care of. Before the deal is finally sealed, the public interest should be taken care of.
In spite of what seems a glimmer of hope for NITEL, however, we are worried by the avalanche of controversies trailing the bidding process. Some stakeholders have complained about the transparency of the process. One of the allegations is that by excluding experienced and leading operators such as Globacom and MTN, a grave error in judgment may have been made by both BPE and NCC. Allegations of insider abuse have also been levelled against top officials of the regulatory agency.
We urge that these allegations be diligently investigated.
Due Process and transparency must be manifestly seen to have been followed in the bidding process. The decision to preclude experienced operators from the process may not be in the overall interest of Nigerians. It could rubbish whatever noble intentions the privatisation efforts want to achieve. Government should take more than a passing interest in the current developments. Allowing controversy to trail the process does not augur well for anybody, including the new investor - New Generation Telecommunication. The government promised that the latest effort at privatising NITEL would be the final one. We hope it will.
This can only be if the sale is done with sincerity of purpose.