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November 29, 2020
Analysis Commentary Economics Popular

LESSONS FROM THE LUCRATIVE TELECOMMUNICATION BUSINESS IN SOMALIA

 

Telecommunication companies in Somalia remain giant players in the Somalia’s economy. The companies over the past years have been operating without any regulations from the government or any authority.

 

Now that the government is recovering from decades of civil war, it is important to introduce regulations and also protect consumers. Consumer protection laws which is meant to protects the rights of consumers set by the government are week in Somalia or nonexistence at all, for start, the Somali government needs to set regulation that will ensure rights of consumers are protected, also with it is multimillion profits how can such huge companies improve the lives of the Somalia.

One major telecommunication company operating in the country is Hormuud. Established in 2002, the company admits on its website to have created more than 20,000 jobs and serving millions of customers. Hormood is the leading telecommunication in Somalia with over 4 million subscribers, 12000 shareholders and more than 800 customer service centres in both urban and rural Somalia.

The network covers more than 80% of the land area in South and Central Somalia. The company’s financial records are not always available but as early as 2002, Reuters (wire service) reported that the company was making $40m in turnover annually.

With hundreds of millions made in profits from the Somali people every year, in a country where studies indicated that 70% of the population lives on less than $2 a day, it is time for Hurmood and the likes to give back to the Somali people.

Telecommunication companies in Somalia, need to increase corporate Citizenship, corporate Citizenship is company’s responsibilities toward society. The goal is to produce higher standards of living and quality of life for the communities that surround them and still maintain profitability for stakeholders.

 

Hormuud and other telecommunication companies in Somalia can be significant in the country’s economic growth. In Kenya, Safaricom, a giant player, engages in valuable economic activities. Companies like Hormuud should not remain behind as far as their strength to impact communities is concerned.

Hormuud and other telecommunication companies in Somalia must invest in an independent charitable trust, that improve the social and economic status of Somalis. They can invest in healthcare, environmental conservation, education, and integrated water projects.

Also telecommunications companies that operate in Somalia can work with the Somali people thus empowering them while providing skills that can lead to sustainable income-generating projects/businesses. By doing so, employment will be created.

There is no sustainable project at funding or developing education standards that telecommunications companies are known to engage in. Yet, they can help build schools, provide lunch that has been known to enable keep students in school.

 

Regional telecommunications giants like Safaricom of Kenya are known to aid develop the arts, culture, and sports. As it stands now, telecommunication companies are the main controller of commerce, banking, voice, data and even surveillance in the country, their contribution to the society must be felt across the board.

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