Telecoms Find Success in War-torn Somalia

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It may be counterintuitive, but unstable countries may provide uniquely strong business opportunities.  That is apparently the case with telecom companies in Somalia, a country that has not had a stable government in nearly two decades.  Abdinasir Mohamed and Sarah Childress report on the success of these perseverant telecoms in the Wall Street Journal:

Backed by expertise from China, Korea and Europe—and funded from their own pockets—Somali telecom entrepreneurs are providing inexpensive mobile-phone services. Users can conduct money transfers via mobile phones and gain Internet access, both wireless functions that aren't widely available in many other parts of Africa.

The success of Somalia's telecom sector isn't all that unusual for a war-shattered economy, experts say. In countries with shaky economic foundations, such as Afghanistan and the Democratic Republic of Congo, telecommunications companies have stepped in to provide missing infrastructure.

In these environments, "the first ones who put in electricity generators in rural areas are the telecom operators," says Svet Tintchev, a World Bank expert on the telecom industry in developing countries. "In a way, their leverage goes beyond pure telecom service."

Read Telecom Firms Thrive in Somalia Despite War, Shattered Economy here.


Posted 05-12-2010 8:03 AM by Graham Griffith
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