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September 2014
Sub-Saharan Africa – Universal Service Fund study
report prepared for GSmA by Ladcomm Corporation
Important Notice
The report is provided exclusively for the GSMA’s use under the terms of the Contract. No party other than the GSMA is entitled to rely on the report for any purpose whatsoever and LADCOMM accepts no responsibility or liability to any party in respect of the report or any of its contents.
The information contained in the report has been obtained from a number of third party sources that are clearly referenced in the appropriate sections. In some instances, figures provided have been clearly identified as estimates. Although LADCOMM has done its best to verify and corroborate the information contained in this report, the information or circumstances may have changed since the report material was gathered. Further, any results from the analysis contained in the report are reliant on the information available at the time of writing the report and should not be relied upon in subsequent periods.
Accordingly, no representation or warranty, express or implied, is given and no responsibility or liability is or will be accepted by or on behalf of LADCOMM or by any of its partners, employees or agents or any other person as to the accuracy, completeness or correctness of the information contained in this document or any oral information made available and any such liability is expressly disclaimed.
3
SSA USF STUDY
01. EXECUTIVE SUMMARY 06
02. INTRODUCTION AND GENERAL OVERVIEW 11
2.1 What is a Universal Service Fund (USF) 112.2 Study objective and methodology 13 03. OVERVIEW OF USFs 15
3.1 Introduction 153.2 Fund profiles 17 3.2.1 Snapshot of the SSA Funds Studied 17 3.2.2 types of services 18 3.2.3 table of USF levies applied 19 3.2.4 Fund collection and disbursement 20
04. DEEP DIVE ANALYSES 22
4.1 GHANA 22 4.1.1 Country overview 22 4.1.2 Current status of telecom market 22 4.1.3 Fund background 23 4.1.4 Current status of the fund 24 4.1.5 What the fund has achieved to date 254.2 MOzAMbIqUE 27 4.2.1 Country overview 27 4.2.2 Current status of telecom market 27 4.2.3 Fund background 28 4.2.4 Current status of the fund 29 4.2.5 What the fund has achieved to date 29 4.2.6 Other elements of interest 304.3 NIGERIA 31 4.3.1 Country overview 31 4.3.2 Current status of telecom market 31 4.3.3 Fund background 32 4.3.4 Current status of the fund 34 4.3.5 What the fund has achieved to date 35 4.3.6 Other elements of interest 36
Contents
4
SSA USF STUDY
4.4 SOUTH AFRICA 37 4.4.1 Country overview 37 4.4.2 Current status of telecom market 37 4.4.3 Fund background 38 4.4.4 Current status of the fund 40 4.4.5 What the fund has achieved to date 434.5 UGANDA 46 4.5.1 Country overview 46 4.5.2 Current status of telecom market 46 4.5.3 Fund background 47 4.5.4 Current status of the fund 49 4.5.5 What the fund has achieved to date 49 4.5.6 Other elements of interest 514.6 ECOWAS 52 4.6.1 Universal Service/Access legal framework and scope 52 4.6.2 Funding mechanism 55 4.6.3 What has the eCOWAS Act achieved so far 55
05. bEST PRACTICES IN THE MANAGEMENT OF THE USF 56
5.1 Introduction 565.2 basic elements and characteristics of a successful USF 57 5.2.1 Sound and flexible legal and regulatory framework 57 5.2.2 Autonomy and independence 57 5.2.3 policy articulation 57 5.2.4 Consultation with stakeholders 58 5.2.5 Delineation of responsibilities between the USF and other external organisations 58 5.2.6 Defined and measurable objectives 58 5.2.7 Flexibility and neutrality in service deployment 59 5.2.8 Fair and objective project allocation process 59 5.2.9 Capacity building and sustainability 59 5.2.10 Innovation and incentives 60 5.2.11 Visibility, transparency and accountability 60 5.2.12 Digital inclusion 60
06. COMMON CHALLENGES IN THE ADMINISTRATION OF USFs IN SSA 61
6.1 Overview 616.2 Underlying legal and regulatory framework 616.3 Difficulty to adapt to changing requirements and focus 626.4 Correlation between USF levies and demand 626.5 Structural deficiencies 636.6 Definition of USF strategy and objectives 636.7 managerial, operational and capacity issues 636.8 transparency, visibility and accountability in USF reporting 646.9 Oversight and governance 646.10 project allocation process 64
5
SSA USF STUDY
6.11 Constraints to broadband deployment 656.12 Underlying infrastructure and facilities 656.13 Availability of resources and knowledge 656.14 Local conditions and related security 666.15 Consideration of digital inclusion 66
07. RECOMMENDATIONS 67
08. USF OVERVIEW TAbLES 68
8.1 burkina Faso 698.2 Cameroon 708.3 Cote d’Ivoire 708.4 Democratic republic of Congo 718.5 Gabon 728.6 Ghana 728.7 Lesotho 748.8 madagascar 758.9 mali 768.10 mauritania 778.11 mauritius 788.12 mozambique 798.13 Nigeria 808.14 Niger 818.15 South Africa 828.16 rwanda 838.17 Senegal 848.18 Swaziland 858.19 tanzania 868.20 togo 878.21 Uganda 888.22 Zambia 898.23 Zimbabwe 91
09. bIbLIOGRAPHY AND REFERENCES 93
9.1 Africa 939.2 General 95
6
SSA USF STUDY
executive summaryThefollowingreportexaminesUniversalServiceFunds(‘USFs’)in23Sub-SaharanAfrican(‘SSA’)countriesTheseUSFsareexaminedinaglobalcontexti.e.,takingintoaccounttheircharacteristicsandperformancewhenmeasuredagainstanadditional46USFsintheArabStates,theAmericas,EuropeandAsiaPacific(anoveralltotalof69countriesstudied).ThereportdrawsoninformationusedtoprepareglobalUSFoverviewreportsforboththeGSMAandtheInternationalTelecommunicationUnion(ITU)overthelasttwoandahalfyears.
Ingeneral,therearesignificantdeficienciesinfundstructure,managementandoperationthroughouttheSSAregion.Infact,ifitisnotpossibletodisbandthemajorityofthefundsandreturnthemoniescollected,thentheseUSFswillrequiresignificantreformandrestructuringinordertobetransformedintofunctionalandeffectiveinvestmentsupportvehiclesforunservedandunderservedareasinSSA.
ThefollowingprovidesabriefsnapshotofthecurrentstateofUSFsinSSA.AdetailedanalysisisprovidedinthesectionsthatfollowthisExecutiveSummary.
• Morethanhalfthefunds(12outof23)applyleviesof2%ormoreofoperatorrevenues.
• Theredoesnotappeartobeanycorrelationbetweentheleviescollectedandtheactualuniversalservicefundingrequirementsi.e.,noin-depthneedsassessmentsorprojectforecastsarecarriedout.
• Justoverhalfoftheinactivefundswithinthe69countriesstudiedarebasedinSSAasdepictedbelow.
01.
7
SSA USF STUDY
• InregardstoUSFprojectfundingcapabilities,thefollowingchartillustratesthetechnologiesandservicesthatcanbesupportedbyUSFs;ofparticularnoteisthatlessthan50%oftheSSAUSFsareabletofundwirelesstechnologiesandjustover25%oftheSSAUSFspermitfundingofbroadband.
13 12
46 66 77
11
INACTIVE FUNDS low ACTIVITy moDErATE ACTIVITy hIgh ACTIVITy
total Sub-Saharan Africa rest of world
18
26
22
fund activity levels
8
SSA USF STUDY
•11fundspermitthefinancingoftele-centresorcommunitycentres(theonlyareainwhichSSAisbetterpositionedthanotherregions).
• Obtainingaccuratefinancialreports(oranyreportsatall)regardingfundscollectedanddisbursedispossibleinonlyafewcountries(e.g.,Ghana,Uganda);evenincountrieswherethetelecommunicationsregulatoryenvironmentisadvancedandthefundguidelinesareclear,thereportssimplydonotgetissued:
•Onlytwofundscurrentlyhaveformalannualreportingproceduresinplace. •Someotherfundsprovideintermittentreportsonprojectallocations.
• Overalltransparencylevelsarelowtoextremelylow(e.g.,Mauritius,Sudan,Zimbabwe)withonlyafewexceptionssuchasGhanaandUgandabutwithsignificanttransparencyimprovementsexpectedinNigeriaandSouthAfrica.
• Boththetotalleviescollectedaswellasthelevelsofundisbursedfundscannotbeaccuratelyascertainedduetothislackoftimelyandtransparentreporting.
total Sub-Saharan Africa rest of world
seRvices/tecHnOlOGies suPPORted
FIxED-lINE DIAl Up INTErNET
wIrElESS broADbAND TElE-CENTrES CoNNECTIVITy oF ANChor
INSTITUTIoNS
pErSoNS wITh DISAbIlITIES
(pwD)
69
23
46
39
13
2629
11
18
6
2328
11
17
24 25
1015
8
16
29
9
SSA USF STUDY
Ascanbeseenfromtheillustrationabove,19ofthe23USFscoveredinthisreportcontainedmorethanUS$400millionwaitingtobedisbursedattheendof2011butthisislikelysignificantlyunderstatedinmostcasesduetothelackofreliablereportingandinformation.Ofthosefundsstudied,manyhavenotdisbursedanymoney.Infact,ofthoseUSFswhereleviesarecurrentlybeingappliedandcollected,itisestimatedthatonly60%ofthesesameUSFshavecarriedoutsomelevelofdisbursementorreportedthatsomedisbursementshavebeenmade.Inotherwords,morethanonethirdoftheUSFsinthisstudyhaveyettodisburseanyoftheleviescollectedandnoneofthefundswould
appeartodisburseallthattheycollect.InthemajorityofthecasesinwhichUSFleviesandtaxeshavebeenestablished,nosubstantiveanalysishasbeencarriedoutbythefundpolicymakersoradministratorsregardingtheactualservicefunding/subsidylevelsneededversustheamountscollected.Itispossible,althoughdifficulttoconfirmconcretely,thatthelackoftechnologicalflexibilityinhowthefundscanbeutilisedmaybeoneoftheunderlyingreasonsforthegenerallylargegapbetweentheleviescollectedandthetypicallyminimaldisbursements.
TheunderlyinglegalframeworksformanySSAfundswerenotwellconceived
1. excludes countries where no financial reporting whatsoever is available (e.g., Cameroon, mali, mauritania and Senegal)
total remaining funds available
estimated funds disbursed
0
50.00
100.00
150.00
200.00
250.00
300.00
bUrk
INA FA
So
CoTE
D’IVo
IrE
gAbo
N
ghAN
A
lESo
Tho
mADA
gASC
Ar
mAUr
ITIUS
mozA
mbIqU
E
NIgEr
NIgEr
IA
SoUT
h AFr
ICA
rwAN
DA
SwAz
IlAND
TANz
ANIA
Togo
UgAN
DA
zAmb
IA
zImbA
bwE
Sources: derivations from annual reports, reports from fund web sites, operator reports, etc.1
usf activity: funds disbuRsed and available
us$
DEmo
CrATI
C rEp
UblIC
oF
CoNg
o
10
SSA USF STUDY
fromtheoutset(e.g.,nottechnology-neutralorservice-flexible,excessivelybureaucratic,insufficientoversight,etc.)andthishasresultedinahighnumberofineffectiveorinactivefundsthantheglobalmedian.Inappropriately-conceivedlegalframeworksalsoposeamajorobstacletotheintroductionofruralbroadband(whetherfixedormobile)inSSAthroughtheuseoftheUSFmechanism.
Eveninfundswherethereisadegreeofautonomyandindependence,therearemanycaseswherepoliticalinterventionorinterferencefromothergovernmentagenciesaffectthefund’sperformanceoritsabilitytofunctionatall(e.g.,Mali)resultinginextensivedelaysindecisionmaking.Atthesametime,manyUSFssufferfrom,orhavebeenaccusedof,poororineffectiveadministration/useoffunds(e.g.,SouthAfrica,NigeriaandZimbabwe)withanumberembroiledindisputesbetweenthefundadministratorsandtheoperators.
Inmanyinstances,theprogrammesandtargetsestablishedforthedeploymentoftele-centresandcommunityinformationcentres(anareainwhichSSAhasshowncommendablefocusfromapolicybutnotanexecutionperspective),forexample,havefailedtotakeintoaccountissuesrelatedtotrainingandeducation,maintenance,powersourcesandothersustainabilityconcerns.Overall,projectandfinancialreporting(transparency)formostfundsareextremelyinadequate.
OutofallthefundssurveyedwithinSSA,GhanaandUgandaappeartobethecountriesthatcometheclosesttoreflectingbestpracticeinthedevelopmentandadministrationofUSFs.Toitscredit,Nigeriahasrecognisedtheneedforamajorrestructuringandre-orientationofitsUSFandisintheprocessofeffectingmajorchanges.Inthesamevein,SouthAfricaputahalttothegrossmismanagementofitsUSFandhasalsoengagedinapositivemajoroverhaul.
Still,alternativeapproachestoachievinguniversalserviceareoftenmoreeffectivethanUSFs.Infact,increasedavailabilityoftelecommunicationsserviceshasgenerallybeenaccomplishedthroughalternatesolutions,suchastheimpositionoflicenceconditionsonoperators,theestablishmentofnewplansorfundsthatareseparatefromtheexistingUSF,orprivate/publicpartnerships(e.g.,BrazilandFinland).
Insummary,basedonthegeneralUSFapproachandperformancetodate,USFsinSSAdonotappeartobethemostappropriatemechanismforprovidinguniversalaccessandserviceandfurtheringsocialandeconomicimprovementinaproactive,costeffectiveandtransparentmanner.Considerationmustbegiventofourpossibledirectionsgoingforward:
• Wherefeasible,inthecaseofcompletelyinactivefunds,disbandinactivefundsandreturntheremainingmoniestotheoperatorswhopaidtheleviesinthefirstplace.
• Wherethepreviousoptionisnotfeasible,graduallyreducethelevycollectedforeitherinactiveorlowactivityfundsandgraduallyphaseoutthefunds.
• Majorimprovementprogrammestodealwiththecurrentdefectsinfundstructureandadministration.
• Explorationanduseofalternativemethodstoachieveuniversalservice.
Introduction and general overview
02.
2.1
WHat is a univeRsal seRvice fund (usf)
SSA USF STUDY
11
Oneoftheprincipalpolicygoalsoftelecommunicationsregulatorsandministriesistomaketelecommunicationsservicesaccessibletothewidestnumberofpeopleataffordableprices.Liberalisationoftelecommunicationmarketsandpromotionofcompetitionhavedeliveredtelecommunicationsservicestothevastmajorityoftheworld’spopulation.TheconceptofUniversalServiceistoprovideeachindividualwithtelecommunicationsservicesataffordableprices.Thisisbasicallyunderpinnedbythefollowingthreeprinciples:
availability
Thelevelofserviceisthesameforallusersintheirplaceofworkorresidence,atalltimesandwithoutgeographicaldiscrimination.
affordability
Forallusers,thepriceoftheserviceshouldnotbeafactorthatlimitsserviceaccess.
accessibility
Alltelephonesubscribersshouldbetreatedinanon-discriminatorymannerwithrespecttotheprice,serviceandqualityoftheservice,inallplaces,withoutdistinctionofrace,sex,religion,etc.
$$$ $$
12
SSA USF STUDY
UniversalService(US)isdistinctfromUniversalAccess(UA)inthatUniversalServiceisgenerallyregardedasbeingorientedtowardsprovidingservicetoindividualsorhouseholdswhereasUniversalAccessisconsideredtobeorientedtowardsprovidingservicetocommunities.
universal service costs vary substantially between countries and are influenced by many factors, including:
there are varying approaches to address universal service requirements. these include2:
Overthelasttwodecades,outoftheapproacheslistedabove,inadditiontomarketbasedreformsandmandatoryserviceobligations,theincreasinglycommonapproachtohelpachievetheuniversalservicegoalhasbeenthecreationofafundingmechanism-USFs.Thesefundsareintendedtoserveasafinancialincentiveforoperatorstoprovideuniversalservice.Suchfundsareoftenusedincompetitivemarketstosupplementmarket-basedpoliciesandinordertoaddressaccessgapsandpossiblemarketfailuresinremoteandunder-servedlocations.Globally,SSAisoneoftheregionsthathasmostenthusiasticallyembracedtheUSFconceptfromapolicyperspective(althoughnotnecessarilyfromanimplementationperspective).
2. ICt regulation toolkit Chapter 5 – Universal Access
• thedefinitionof‘universal’aswellasthe‘universal’policygoalasappliedinaparticularjurisdiction;
• thedemographicandgeographicalcharacteristicsofacountry,forexample:
•incomedistribution(affordabilitylevels) •populationdensity •ruralandurbanpopulationratios •literacyandeducationratesofthepopulation •geography(terrain,distances,etc.)
• efficiencyandpresenceofexistingoperators;and
• existinglegalandregulatoryframework(e.g.,monopoly,liberalised).
•marketbasedreforms•mandatoryserviceobligations•crosssubsidies
•accessdeficitcharges•universalfunds• privatepublicpartnerships
13
SSA USF STUDY
2.2
study Objective and MetHOdOlOGy
Inlate2012,amajorglobalstudyencompassing64countrieswasconductedonbehalfoftheGSMAinordertoexaminetheperformanceandefficacyofUSFs.ThiswasfollowedbyanITUstudyof69countries,completedinmid-2013,whichfocusedonwaysinwhichtoimproveexistingfunds.ThesestudiessoughttoexaminewaysinwhichUSFshavebeencreated,thevolumeofmoniescollectedandtheextenttowhichmoneywasdisbursedandprojectsfunded.Inaddition,thestudiesalsoaddressedwhetherthecurrentstructuresofmanyUSFsareflexibleenoughtopermitatimelyandpracticalresponsetorapidtechnologicalchangeandsocietalrequirements.ThisreportattemptstoamalgamateanddistilltheinformationaddressedinthesetwoseparateglobalstudiesinordertoprovideadetailedanalysisofhowfundsareoperatinginSSAandwhetherimprovementsoranewparadigmarerequiredgoingforward.
Theprojectteamusedrawdatacollectedforthereportsreferencedintheprevioussection.Thisdatawasobtainedfromavarietyofsourcesincluding,butnotlimitedto,internetsearches,entryintospecificregulatorandUSF/UniversalServiceAccessFund(USAF)websitesanddatabasesandaccesstopublishedarticlesandreports.Theteamalsoexchangedcorrespondenceandconductedinterviewsandconferencecallswithregulators,fundadministratorsandfundassociations(withvaryingdegreesofsuccessintermsofresponseratesfromtheentitiesandindividualscontacted).Inaddition,theteamalsoreliedonitsnetworkofcontactsamongstregulators,operatorsandindustryanalyststoseekoutadditionalinformationthatisnotreadilyavailablepublicly.
Whereverpossible,thesamedatabasewasusedtopresentthesameinformationelements;howevermanydatabasesdonot
Inthemajorityofcases,USFsarefinancedthroughacontributionmechanismfromtelecommunicationsserviceproviders.TheUSFcontributionmethodologycanbeaddressedinseveraldifferentways.Insomecases,thecontributionsarefixedmonthly,quarterlyorannualfeeswhereas,inothers,thefeesarecalculatedasapercentageofgrossrevenues(oftenwithsomedefinedexclusionsinthecalculationoftherevenues).Asinthecaseofrevenuesharingschemes,theremaybearequirementfortheserviceproviderstopayestimatedamountsbasedonrevenueprojections,withretroactiveadjustmentsmadeoncetheyearendauditedannualfinancialresultsaremadeavailable.Insomecountries,theUSFfeeisnotaseparatefeebutrather,aportionofanoverallregulatoryorlicensingfee.Insuchcases,theportionofthefeetobedirectedtotheUSFmaybefixed,butinothercases,
itcouldbesubjecttoannualreview.ThefeesmaygodirectlytotheUSForUSFadministrator,orthefeesmaybecollectedbytheNationalRegulatoryAuthority(‘NRA’)andthensubsequentlytransferredtothefundmanager/administrator.
Inadditiontoaserviceprovider’sdirectorindirectcontributionmechanism,theremaybeothersourcesoffundsincluding,butnotlimitedto:fullorpartialproceedsfromspectrumauctions,licensingfees,directgovernmentcontributions,privateindustrycontributions,etc.ThemannerinwhichtheseUSFfundsmaybesubsequentlyaccessedandutilisedisaddressedwithinthisdocumentandwillbeexploredinthesectionsthatfollow.
14
SSA USF STUDY
includedataforallcountriesandinsuchcases,everyattemptwasmadetolimitthenumberofdifferentdatabasesutilisedforthespecificinformationelement(e.g.,GSMAIntelligenceandGlobalWirelessMatrixforwirelesspenetrationlevels).DatagatheringwithrespecttothefinancialperformanceofmostoftheSSAfundswasespeciallychallenginggiventhelackofreliable,publishedinformationinthisregard,coupledwithextremereticenceonthepartofmostfundadministratorstoenterintoanydetaileddiscussionsregardingfinancialreporting.
Inadditiontothechallengesofdealingwithconflictinginformation,asreferencedabove,anevenmoredifficultaspectofthereportwasthescarcityofaccurate,credibleinformationwithrespecttotheUSFfundscollected,theUSFfundsdisbursedandthemoneystillresidingintheindividualfunds.Thisisprimarilyattributabletothefactthatveryfewfundsappeartohaveanyregular,formalreportingwithrespecttothefinancialmanagementofthefund;inordertoarriveatestimatesinthisregard,inadditiontousingandcitingfundfinancialreportswhereavailable,theauthoralsousedthefollowingapproaches:
• Compilationofindividual,confidentialreportssubmittedbyoperatorsinwhichtheirannualUSFcontributionswereidentified;usingmarketsharedata,annualreports(orsimilar),estimatedotheroperators’contributionsonaconservativeproratabasis.
• “Offtherecord’discussionswithregulatorsandfundmanagers.
• SearchesofnewspaperandmagazinearticlesthatreferencedUSFamounts.
• Incaseswherethefundleviesareadefinedpercentageofoperatingrevenues,aderivationofcontributionsbasedonpubliclyreportedoperatorrevenuesifandwhennootherofficialsourcewasavailable.
• Whentheaforementionedapproachesfailedtoyieldresults,wherefeasible,theauthorhascitedpreviouslypublishedestimateswheretheestimatesappearedtobefromreliable/officialreportingsources(e.g.,ITU).
• Insomecases,noneoftheseapproachestocalculatingfundsweresuccessfulandrequestsforinformationfromthefundadministratorsremainedunanswered.
overview of UsFs
Asalludedtointheexplanationintheprevioussectionregardingthestudymethodologyutilisedinthepreparationofthisreport,theabilitytoarriveatanaccurateunderstandingofUSFsinSSA(orforthatmatter,elsewhere)isfrequentlyhamperedbytheavailabilityandreliabilityofinformation.Ontheonehand,thereisamultitudeofinformation,oftenconflictingorcontradictory,regardingtheadministrationandperformanceofsomefundswhereas,ontheother,thereisanalmostcompletelackofeasilyaccessibleinformationforotherfunds,especiallyincountrieswherepublishedinformationisavailableonlyinthenationallanguage.FurthercompoundingthesechallengesisthatmanyoftheofficiallypublishedreportsregardingUSFsreflecttheunderstandablyhumanreactionofwantingtopresentachievementsinthebestpossiblelightwhileperhapsunderstatingsomeofthelesssuccessfulaspectsoftheUSFinquestion.Therefore,inthesectionswhichfollow,theauthorhasattemptedtopresenttheinformationasconsistentlyandasobjectivelyaspossibleusingmultipleinformationsourceswiththeaimofpresentingabalancedassessmentoftheoverallstateofUSFsasoflate2012/early2013.Thiswasnotalwayspossibleandwheretheinformationisolder,thishasbeenidentified.TheUSFinformationcontainedinthissectionisasfollows.
Section3.2–FundProfilescontainsaseriesofsummarytablesintendedtohighlighttheprincipalcharacteristicsofthefundsexaminedinthisreport;thisincludes:
• asnapshot/highlevelsummaryofthefundprofiles
• typeofservicesonapercountrythatcanbesupportedbytheUSF
• descriptionofUSFleviesandhowtheyareappliedpercountry
• anexaminationonacountrybycountrybasisofthestatusoffundscollectedversusfundsdisbursed.
03.
3.1
intROductiOn
15
SSA USF STUDY
16
17
SSA USF STUDY
3.1
fund PROfiles
3.2.1 snaPsHOt Of tHe ssa funds studied
ThefollowingtabledisplaysthecurrentstatusoftheSSAfundsincludedinthestudy.Thedefinitionsforfundactivitylevelsareasfollows:
1 inactive–moniescollectedbutnoknowndisbursementshavetakenplace
2 lOW activity–lessthanfiveapplicationsofthefund
3 MOdeRate activity–betweensixand15applicationsofthefund
4 HiGH activity–morethan15applicationsofthefund
3. An anchor institution includes but is not limited to schools, colleges, universities, health centres, hospitals, post offices, sports facilities, performing arts and other cultural facilities (such as museums and libraries) and public utilities.
TOTALSUB-
SAhARANAFRICA
RESTOFThEWORLD
ToTal Number of fuNds surveyed 69 23 46
LEvELOFFUNDACTIvITy
INacTIve fuNds 18 7 11
low acTIvITy 13 6 7
moderaTe acTIvITy 12 6 6
HIgH acTIvITy 26 4 22
SERvICES/TEChNOLOGIESSUPPORTED
fIxed-lINe 69 23 46
dIal up INTerNeT 39 13 26
wIreless 29 11 18
broadbaNd 29 6 23
Tele-ceNTres 28 11 17
coNNecTIvITy of aNcHor INsTITuTIoNs3 24 8 16
persoNs wITH dIsabIlITIes (pwd) 25 10 15
ssa usf study
18
SSA USF STUDY
4 Other has many different definitions but generally refers to tele-centres, community access centres and similar concepts.
3.2.2 tyPes Of seRvices
AlthoughtherearenumerousquestionsregardingthestructureandperformanceofUSFs,oneofthemostfundamentalquestionsthatisaskedonaconsistentbasisiswhatservicescanbeaddressed/subsidisedbyUSFs?ThefollowingsummarychartdemonstratedwhysomanySSAfundsareextremelylimitedintheinvestmentsthattheyareabletoundertake.Thesehighlevelprofilesarebrokendowningreaterdetailinsection4–DeepDivesaswellasinsection8–USFCountryOverviewTables.
COUNTRy/REGION FIxED WIRELESS BROADBAND DIAL-UP
INTERNET OThER
1. burkINa faso2. camerooN3. coTe d’IvoIre4. democraTIc republIc of coNgo5. gaboN6. gHaNa7. lesoTHo8. madagascar9. malI10. maurITaNIa11. maurITIus12. mozambIque13. NIger14. NIgerIa15. souTH afrIca16. rwaNda17. seNegal18. swazIlaNd19. TaNzaNIa20. Togo21. ugaNda22. zambIa23. zImbabwe
USFALLOWSCOvERAGE/FUNDINGOF:
permitted Not permitted
19
SSA USF STUDY
3.2.3 table Of usf levies aPPlied
Thefollowingtablesummarisestheleviesastheyareappliedwithinindividualcountries.Additionaldetailisprovidedin sections4and8.
Oneofthemajorchallengesregardingtheleviescontainedinthetableaboveisthat,asfarascanbedetermined,thereisnocorrelationbetweenhowthelevywasdeterminedversusthesumsactuallyrequiredtoachieveuniversalservicegoals(ifindeedthesegoalshaveevenbeenarticulatedinthefirstplace).AlthoughsomeUSFshavepublishedbudgetsfromtimetotime,theyhavenotformedthebasisoftheleviessincethelevyamounthasbeenpre-set.
COUNTRy AMOUNTANDNATUREOFLEvy
1. burkINa faso 2%ofannualrevenuenetofinterconnectionpaymentsfromalloperators
2. camerooN 3%ofuntaxedannualturnover
3. coTe d’IvoIre 2%ofGrossAnnualRevenuesfrommobileoperatorsonly
4. democraTIc republIc of coNgo
Contributionsassessedagainstalloperators,providersofservices,andmanufacturersorimportersoftelecommunicationsmaterials;noknownassessmentstodate
5. gaboN 2%ofnetrevenueperyearfromfixedandmobileoperators
6. gHaNa Licensedoperators(fixed/mobileoperatorsandMNPCRDBserviceproviders)arerequiredtocontribute1%oftheirannualrevenue(NetrevenuemeansGrossRevenuelessvAT,NationalhealthInsuranceLevy)
7. lesoTHo 1%ofNetOperatingIncomeonannualbasis;canalsouse25%ofNRAoperatingsurplus
8. madagascar Annualcontributionsofoperatorsequalto2%ofgrossrevenuesearnedfromoperatingpublictelecommunicationsnetworksandprovisionofpublictelecommunicationsservices
9. malI 1%ofannualrevenuesfromlicensedoperators
10. maurITaNIa 3%ofgrossrevenues
11. maurITIus Eitherapercentageofturnoverorapercentageofthepriceofeveryincomingcalloneachfixedandmobileoperator’snetwork:
1).Annualcontributionpaidinmonthlyinstalmentsbyoperator-5%ofgrossrevenuegeneratedbyoperatorfromprovisionofinternationalroamingserviceforthatmonth
2).US$0.025perminuteofinternationalcallsterminatedbyoperatorinthatmonth
12. mozambIque Alllicensedandregisteredentitiesrenderingtelecommunicationspublicservicesmustcontribute1%ofnetoperatingincomeofthepreviousyear
13. NIgerIa OperatorsdonotcontributedirectlytotheUSPFbutarerequiredtopay2.5%ofnetoperatingrevenue,(AnnualOperatingLevy:AOL).TheNCC,inturn,contributes40%oftheAOLtotheUSPFforitsactivities.Basedonthe2007Regulation,thefundistobefinancedbasedon1%ofnetrevenues(netofinterconnectionpayments)ofthelicensees
14. NIger After2003:4%ofannualnet(gross)revenuefromalllicensedoperators
15. souTH afrIca CASAdeterminesthebasisofoperators’contributions,whichmaynotexceed1%oftheirannualturnover.Currently,thecontributionissetat0.2%ofannualturnover(totalrevenuefromlicensedactivity,lessserviceproviderdiscounts,agencyfees,interconnection,facilitiesleasingcharges,governmentgrantsandsubsidies)
16. rwaNda 2%ofgrossannualrevenues,netofinterconnectionpaymentsfromalloperators
17. seNegal 3%ofsales(excludingtaxes)fromallenergyandtelecomplayersplus0.15%ofturnoverfromlicensedtelecomoperators
18. swazIlaNd Contributionsfromagenerallevyonalloperators’revenue(amountnotspecified)
19. TaNzaNIa 0.3%ofyearlygrossoperatingrevenuefromallcommunicationsserviceoperators(includingISPs,postandcouriercompanies)
20. Togo 2%ofannualgrossrevenuesnetofinterconnectionpaymentsfromalloperators
21. ugaNda 1%ofgrossannualrevenuesnetofinterconnectionpayments,fromalloperators,includingthepostalservicecouriersandISPs
22. zambIa CAZhasbeenretaining10%ofitsrevenuefromannuallicensingfeeaspartofUSDF
23. zImbabwe 2%ofGrossAnnualRevenuesfromalloperators
20
SSA USF STUDY
3.2.4 fund cOllectiOn and disbuRseMent
Asdiscussedearlier,availabilityofaccurateinformationisextremelylimitedinSSAcountriesregardingthetotalfundsamountscollectedanddisbursed.Wheninformationismadeavailable,itisgenerallylatetobepublishedorsimplyoutofdate.Aswillbedemonstratedinsection7–USFOverviewTables,thereissomeavailabilityregardingthefundsutilisedonanindividualbasisbut,typically,thisispresentedintheabsenceofanycontextregardingthetotalamountoffundscollectedorspent.Inthetablebelow,whereavailable,therespectivecolumnsindicatethelastyearforwhichinformationwaspublishedregardingthetotalleviescollected.Thesubsequentcolumnsthenpresentthelastyearinwhichafundbalancewasreportedfollowedbyanyreporteddisbursements.Thefinalcolumnreflectsestimatesofthelevelsremainingintheindividualfundsoncethemonieshavebeendisbursed.Itisextremelyimportanttoreiteratethattheseareestimatesbasedonthebestavailableinformationcalculatedusingthevarioussourcesexplainedpreviouslyinsection2.disbursements.Thefinalcolumnreflectsestimatesofthelevelsremainingintheindividualfundsoncethemonieshavebeendisbursed.Itisextremelyimportanttoreiteratethattheseareestimatesbasedonthebestavailableinformation calculatedusingthevarioussourcesexplainedpreviouslyinsection2.
COUNTRy/REGION
LASTyEARCONTRIBUTIONREPORTED/ESTIMATED
CONTRIBUTIONAMOUNTIN(US$M)
LASTyEARFUNDBALANCEREPORTED/ESTIMATED
REPORTEDFUNDBALANCEAMOUNTIN(US$M)
REPORTEDMONEyDISBURSEDIN(US$M)
ESTIMATEDREMAININGFUNDSAvAILABLE(US$M)yE2010/2011
1. burkINa faso 2010 5.30 2010 32.70 0.00 32.70
2. camerooN3. coTe d’IvoIre 2010 30.00 2010 28.10 15.60 12.50
4. democraTIc republIc of coNgo
2008 19.10 2008 63.20 0.00 63.20
5. gaboN 2009 2.50 2009 2.50 0.00 2.50
6. gHaNa 2011 8.10 2011 10.50 10.50
7. lesoTHo 2011 1.00 2011 0.61 0.61
8. madagascar 2011 4.20 2011 10.00 10.00
9. malI10. maurITaNIa11. maurITIus 2011 2.70 2009 1.70 1.70
12. mozambIque 2008 1.90 2009 3.00 3.00
13. NIger 2011 8.70 2011 28.00 0.00 28.00
14. NIgerIa 2008 159.70 2010 266.77 106.70 160.00
15. souTH afrIca 2011 28.80 2011 28.80 28.80
16. rwaNda 2008 2.40 2010 6.60 3.70 2.90
17. seNegal18. swazIlaNd 2008 2.40 2008 6.00 4.25 1.76
19. TaNzaNIa 2010 2010 3.00 0.00 3.00
20. Togo 2011 1.20 2011 5.10 0.00 5.10
21. ugaNda 2011 3.50 2011 47.00 40.00 7.00
22. zambIa 2009 12.00 0.00 12.00
23. zImbabwe 2009 3.20 2010 20.00 20.00
regIoNal ToTal 284.70 575.51 170.25 405.26
SSA USF STUDY
21
General assessment6:Primarilymicrowaveradiorelay;wirelesslocalloophasalsobeeninstalled;theoutdatedandgenerallyunreliablefixed-lineinfrastructureisheavilyconcentratedinAccra.
domestic telecommunications:Competitionamongmobile-cellularprovidershasspurredgrowthwithasubscribershipofmorethan80%andrising.
• Approximately285,000fixed-lines(2012)7
Mobile (cellular) communications:• 25.618millionsubscribers8(yE2012)• Wirelesspenetration:105.8%(yE2013)9
• Mainoperators10: • Scancom(MTN)–54.2% • Airtel(formerlyZain/Celtel,Westel)
–15.8% • vodafone(GhanaTelecom)–15.0% • Tigo(Millicom)–12.0% •Globacom(Glo)–2.5% •Expresso–0.5%
04.
5. CIA World Factbook 20146. CIA World Factbook 20147. Id.8. Id.9. GSmA Intelligence10. buddeComm – Ghana – Key Statistics, regulatory and Fixed-Line telecoms – Overview.
4.1.2 cuRRent status Of telecOM MaRket
4.1.1 cOuntRy OveRvieW
Ghanahasalandmassofapproximately238,533sq.km.andislocatedinWesternAfrica,borderingtheGulfofGuinea,betweenCoted’IvoireandTogo.
Ghanaconsistsmostlyoflowplainswithadissectedplateauinthesouth-centralarea.Its25.2millioninhabitantsare51.9%urbanwithmanyresidinginthetwomajorcities:Accra(capital)–2.3millionandKumasi–1.8million.
22
ghANA’S gDp pEr CApITA (ppp) IS
US$3,500 (2013 ESTImATE).5$accRa
kuMasi
tOGO
benin
cÔte d’ivOiRe
Gulf Of Guinea
buRkinO fasO
4.1
GHana
SSA USF STUDY
Deep dive analysis
23
SSA USF STUDY
11. CIA World Factbook 201412. http://www.budde.com.au/research/Ghana-telecoms-mobile-broadband-and-Forecasts.html
Ghanahasoneofthemorecompetitivetelecommarketsintheregion.Thecountrywasamongthefirsttoprivatisetheincumbentoperator,andwasapioneerindevelopingmobiletelephonyanddataservices.Itwasalsoamongthefirstonthecontinenttoconnecttotheinternet.Althoughfixed-lineinfrastructurerequiresconsiderableinvestment,thedynamicmobilemarkethasensuredthatinternetpenetrationisrelativelyhigh.
Thegovernmenthasmadesteadyprogressinrecentyearstodevelopcomputerliteracyandtoextendinternetavailabilitythroughanetworkofpublicaccesspoints.Lowuserpenetrationintheearlypartofthecenturywaslargelyduetothehighcostofservices,exacerbatedbyunreliablenetworksandpoorqualityofservice.however,inrecentyears,internationalconnectivityhasincreaseddramatically:afifthsubmarinecablewhichenteredintoserviceearlierin2013hashelpedreducethecostofbandwidthtoatenthofwhatitwasin2007.Lowerpricinghasfiltereddowntoconsumers,withGhanaTelecombeingoneofseveraloperatorsthathaveinvestedinnationalnetworkstoextendbroadbandavailabilitydeeperintoruralareas12.
Themobilemarketiswellservedbysixcompetingplayers.ServicesbasedonhSPAtechnologyhavehelpedtoextendbroadbandavailability.Thishasimprovedthegrowthpotentialofm-commerceand
m-bankingservices.MTNGhana’sMobileMoneyserviceisverypopular,complementedbyitsnew‘ATMCashOut’service.ThelaunchofMobileNumberPortabilityinmid-2011hasalsobeenacatalystforcompetitionbetweenplayers,withthenumberofportingbymid-2013havingincreased21%year-on-year.Thetimetakentoportanumberremainsveryfastbyinternationalstandards.
4.1.3 fund backGROund
InMarch2003,theGovernmentcompletedtheformulationofacomprehensivenationalICTPolicyreferredtoastheGhanaInformationandCommunicationTechnologyforAcceleratedDevelopment(ICT4AD).Thisroadmapwasdevelopedtoenrichsignificantlytheeconomicandculturalwell-beingofthepopulacethroughtherapiddevelopmentandmodernisationofthecountryusinginformationandcommunicationstechnologiesasthemainengineforeconomicandsocialdevelopment.Underthispolicy,theGhanaInvestmentFundforTelecommunications(GIFTEL)wassetupasanagencyoftheMinistryofCommunicationstofacilitatetheprovisionofconnectivityandinfrastructuretotheCommunityInformationCentres(‘CICs’)thathavebeenconstructedatunderserved/unservedandremoteareas.GIFTELwasalsoassignedtoprovidetrainingtoallpersonalandorganisationsinchargeofmanagingtheCICs.TheElectronicCommunicationsAct775
USErS: 1.297m
(2009)hoSTS:
59,086 (2012)
internet11:
24
SSA USF STUDY
of2008,establishedtheGhanaInvestmentFundforElectronicCommunications–GIFEC-anindependentagencyoftheMinistryofCommunicationsinchargeofmanagingtheFund.GIFECismanagedbyaSecretariatunderthedirectionoftheAdministratoroftheFund(ChiefExecutive)anditoverseestheimplementationoftheFund’sprojects.Licensedoperators(fixed/mobileoperators,andrecentlylicensedMNPCRDBserviceprovider)contributeonepercent(1%)oftheirannualrevenue.(NetrevenueiscalculatedusinggrossrevenuelessvAT,nationalhealthinsurancelevy,communicationsservicetaxandinterconnectcharges).
OtherapprovedsourcesofGIFECfundinginclude:
• MoniesprovidedbyParliament.• MoniesthatmayaccruetotheFundfrom
investmentmadebytheTrusteesoftheFund.• Donations,grantsandgifts.• Anyothermoniesthatmaybecome
lawfullypayabletotheFund.
4.1.4 cuRRent status Of tHe fund
Asstatedabove,GIFTELwassetuptofacilitatetheprovisionofuniversalaccesstobasictelephonytotheunservedandunderservedcommunities.ProjectsthataresubsidisedthroughGIFECareprioritisedusingthefollowingcriteria:
• Provisionofbasictelephonyservicetoruralareas.
• Supportfortheestablishmentofaccesstovalue-addedservicesincludingtheintroductionofInternetPoints-of-Presence(PoPs)ineverydistrict.
GIFECwidenedthescopeofitsmandatetoincludetheprovisionofaccesstoelectronicservicesincludingICT,broadcasting,internet,multimediaserviceandbasictelephony,fortheunservedandunderservedcommunities.
Disbursementmainlytakestheformofnon-commercial,butcompetitive,grantsasfollows:
• Forpublictelephonyprojects,internetPoint-of-Presenceandtrainingcontractsbyopentender.
• Forapplicationsinunderserved/unservedruralareasorwheresupportissoughtforruralsolutionstoenhanceaccesstoservicesforpublictelephonykiosksortele-centres(atamountsbelowacertainUS$),bydirectdisbursementbasedonabusinessplandemonstratingfinancialviabilityorself-sustainability.
Infrastructuresubsidiesaretypicallyprovidedtothefirstentrantinanareaandthennewentrantssharethemast.
Theboardevaluatesproposalsfortheirtechnicalandfinancialviability.Criteriaforselectingtownsandvillagesfortheprojectdependonlocation,populationandsocio-economiccharacteristicse.g.,numberofschools,healthservices,economicactivities,telecommunicationssignalavailabilityandgeographicobstacles.
TenderingisconductedthroughtheNationalCompetitiveTenderingproceduresspecifiedinthePublicProcurementActoftheRepublicofGhana.AnycompanythatimplementsprojectstoprovideICTfacilitiestounderservedareasiseligibletoparticipate.
TheFundisgovernedthroughaBoardofTrustees:10trusteesthatincluderepresentativesfromtheNationalCommunicationsAuthority(NCA),theMinistryofCommunications,theparliamentaryselectcommitteeoncommunications,arepresentativefromeachlicensedtelecomoperatorandtheadministratorofthefund.TheMinistermaydirecttheTrusteesoftheGIFEConmattersofpolicy.
25
SSA USF STUDY
4.1.5 WHat tHe fund Has acHieved tO date
Bywayofexample,GIFEChasoverseenthefollowinginitiatives:
• CommonTelecommunicationFacilityProject:Commenced2006:Constructionoftowersforco-locationbytelecomoperatorstoextendtelecomservicestounderservedareas.41towerswereconstructed.
• LastMileInitiativeProject:Commenced2006,incollaborationwithUSAID/Ghana,pineappleandcitrusproducingareasaretargetedandprovidedwithaccesstotelecommunications/ICTservices.OnepilotprojecthasbeencompletedatNsaakyeintheEasternRegion.AsecondprojectwascompletedatGeorgefieldsintheCentralRegion.Thisisalsotobeextendedtocotton,mango,andriceproducingareas.
• CICProject:GIFEChasbeenimplementingthisonbehalfoftheMinistryofCommunications.Thisentailsestablishinghybrid,for-profittele-centresandnon-profitcommunityresourcecentrestargetingthegeneralcommunitymembers,schoolchildren,outofschoolyouth,womenandwomen’sgroups,privatebusinesses,non-governmentalorganisationsandlocalgovernmentauthorities.By2010,120CICswereatvariousstagesofcompletionin100districts/municipalities.Underacost-sharingagreementbetweentheMinistryofCommunicationandtheUnitedNationsDevelopmentProgramme,79CICshavebeenequippedwithICTequipment,networkinfrastructureandtrainedcentremanagers.
Theremaining70districts/municipalitiesweretohaveatleastoneCICasenvisionedinGIFEC’sstrategicplanfor2010-2012.
• LibraryConnectivityProject:EstablishmentofICT-basedMobileDigital-cottages(MD-Cs)andRegionalDigitalLibraryInformationCentres(RDLICs)inordertopromoteandfacilitateaccess.
• RuralPayPhoneProject:GIFECwastoprovide12,000ruralpayphonestounderservedcommunitiesduringthethreeyearperiod2010-2012(theEQUATELproject)–nofurtherupdatepublishedatthistime.
• EasyBusinessConnectivityProject:Toenhanceavailabilityofseedfinancingonflexibleandreasonabletermsforentrepreneursseekingtooperatee-powerede-businesscentres.
• PostOfficeConnectivityProject:ToselecttenpostofficeswiththerequisitephysicalinfrastructuretoenablethedeliveryofbasicInformationTechnologyandtelecommunicationsservicesinthepilotphase,followedbyseventyPostOfficesfortheSecondPhase(2011-2012).
• DisabilityEmploymentProject:ImplementedbyGIFECandNCPDaretheEasyBusinessCentresforPersonswithDisabilities.
• SecurityConnectivityProject:toestablishastateoftheartICTtrainingcentreatthePrisonsTrainingSchool.
• SchoolConnectivityProject:providingeducationalinstitutionswithhighspeedcomputers,printers,scanners,projectorsandserversandlinkingthemwithinternetaccess.Theprojectstartedonapilotbasisin2008.In2009,GIFECprovidedsupportto50schools.By2010,GIFEChadsupported263educationalandtraininginstitutions.TheplanwastoprovideICTequipmentandconnectivityto200educational,vocationalandtraininginstitutionsinthe2010-2012period.
26
SSA USF STUDY
• CommunityInitiativeProject:ToestablishstateoftheartICTtrainingcentresforruralcommunitiesacrossthecountryandprovidetrainingincomputerskillsandliteracy.
• FishingProject:IncollaborationwiththeFisheriesCommissionandtheNationalCanoeFishermenCouncil,tointroduceenhancedfishingtechniquesusingstate-of-the-arttechnologytoaddressthefishingneedsoftheartisanfishermen–wastoberolledoutin2012.
• ICTCapacityBuilding:2010-2012,GIFECplannedtofundtheprovisionofbasicICTtrainingtoover12,000peopleintheunderservedandunservedcommunitiesusingtheCICfacilities.
GIFECiscollaboratingwithallthemajortelecommunicationsoperatorsintheprovisionofCommonTelecommunicationsSiteFacilitiesinselectedareasacrossthecountryundertheUniversalAccesstoTelecommunicationsProgramme(UATP).ThecollaborationinvolvestheawardofsubsidiestowillingandeligibletelecommunicationsoperatorsfortheprovisionofCommonTelecommunicationsSiteFacilities.
Inarecentpressrelease(2014),theCEOofGIFECstatedthatasthefundhasprovidedfullyequippedandfurnishedICTlaboratoriesto38collegesofeducation,27technicalschools,10nationalyouthdevelopmentinstitutes,37nationalvocationaltrainingcentres,25communitydevelopmentschools,62nursingtrainingschools,293seniorhighand10juniorhighschoolsaswellasthreeopportunityindustrialisationcentresandeightfarminstitutes.Inaddition,avarietyoftelecommunicationsandICTequipmentwasprovided,amongstothers,tothePostOffice,theArmedForces,theGhanaPoliceandtheGhanaPrisonSystem.
MatOla
MaPutO
tanzania
zaMbia
ziMbabWe
sOutH afRica
sWaz.
MalaWi
General assessment14:Afairtelecommunicationssystemthatisshackledwithaheavystatepresence,lackofcompetitionandhighoperatingcostsandcharges.
domestic telecommunications15:Ischaracterisedby:stagnationinthefixed-linenetworkcontrastswithrapidgrowthinthemobile-cellularnetwork;mobile-cellularcoveragenowincludesallthemaincitiesandkeyroads,includingthosefromMaputototheSouthAfricanandSwazilandborders,thenationalhighwaythroughGazaandInhambaneprovinces,theBeiracorridor,andfrom
NampulatoNacala;extremelylowfixed-lineteledensity;despitesignificantgrowthinmobile-cellularservices,tele-densityremainslowatabout35per100persons.
• Approximately88,100fixed-lines(2012)16
• State-ownedTDMcontinuestobethesoleprovideroffixed-lineservices
Mobile(cellular)communications:• 8.1Msubscribers17(yE2012)• Wirelessmarketpenetration
(yE2013):48.4%18
4.2
MOzaMbique
13. CIA World Factbook 2014 14. Id.15. Id.16. Id.17. Id.18. GSmA Intelligence
27
SSA USF STUDY
4.2.1 cOuntRy OveRvieW
MozambiqueislocatedinSouthEastAfricaandisborderedbyMalawi,SouthAfrica,Swaziland,Tanzania,ZambiaandZimbabwe.Itsterrainispredominatelycoastallowlandwithuplandsinthecentre,highplateausinthenorthwestandmountainsinthewest.Mozambiquespansalmost800,000sq.km.andhasapopulationofover23millionwiththeurbanpopulationmakinguponlyabout38%ofthetotalpopulation.Thereareover1.5millionpeoplelivinginthecapitalcityofMaputoandover700,000inMatola.
4.2.2 cuRRent status Of telecOM MaRket
mozAmbIqUES’S gDp pEr CApITA (ppp) IS
US$1,200 (2013 ESTImATE).13$
28
SSA USF STUDY
ThreeMainOperators: •MCel,thestate-ownedfirstprovider
ofmobileservicesinthecountry,hadapproximately43.5%marketshareasofyE2013.
•vodacom,85%ownedbyvodacomSouthAfricaandoperatingsince2002,hadapproximately32.6%marketshareasofyE2013.
•Movitel,ownedbyaconsortiummadeupofviettelTelecom(vietnam)andMozambique’sSPI,wasawardedalicenceinNovember2010andasofyE2013had24%marketshare.
internet19:
Priortotheliberalisationofthetelecommunicationsindustry,MozambiquewasunderPortugueseruleandthePortuguesestate-ownedmonopoly,Correios,TelegrafoseTelefones(CTT)wasthesoleprovideroftelecommunicationsinthecountry.InJune1981,theCTTwasdissolvedandTelecomunicaçõesdeMoçambiqueE.E.(TDM)wascreated,becomingthesoleproviderofservicesinthecountry.In1992,
theindependentregulator,InstitutoNacionaldasCommunicacoesdeMozambique(INCM),wascreatedandTDMalsobecameapubliccompany.Thesecondmobilelicencewasawardedtovodacomin2002.TheTelecommunicationsLawof2004attemptedfurtherliberalisationbyintroducingacompetitiveregulatoryregime.
AlthoughMozambiqueisoneofthehighestgrowthpotentialtelecommarketsinAfrica,penetrationratesremainrelativelylowandthemainreasonforthisisthatproperinfrastructurehasnotbeenputinplace.Furthermore,themajorityofpopulationislowincomeandcloseto50%ofthepopulationareilliterate.
4.2.3 fund backGROund
TheTelecommunicationLawNo.8of21July2004,whichwasbasedonthe2004TelecommunicationsPolicy,laidthegroundfortheregulationofuniversalserviceandtheestablishmentofaUSF.ThefundwasadministrativelyestablishedbyDecreeNo.69ofDecember262006,whichsetoutdetailsoftheregulationoftheUniversalAccessandServiceFund.ThecollectionoffundsdidnotcommenceuntilaMinisterialDiploma79/2007of4July2007fixedtheannualcontributiontobepaidbythetelecomoperatorstotheUSAF.Thefundstartedtocollectcontributionsin2008.
TheUniversalAccessServiceFund,FundodoServiçodeAcessoUniversal(fsau, uasf) isaseparateinternalunitandaccountunderthenationalregulator,InstitutoNacionaldasComunicaçõesdeMoçambique(INCM)andismanagedbytheExecutiveSecretaryoftheUASFInternalUnit.TheExecutiveSecretaryoftheUASFreportsdirectlytotheBoardofDirectorsofINCMandworksincoordinationwithotherdepartmentswithintheRegulator.TheBoardofINCMoverseestheactivitiesanddecisionsoftheUSAF.
USErS: 613,600m
(2009)
hoSTS:89,737 (2012)
19. CIA World Factbook 2014
29
SSA USF STUDY
Alllicensedandregisteredentitiesprovidingpublictelecommunicationsservicesmustcontribute1%oftheirpreviousyear’snetoperatingincometotheUASF.OperatorswhooperateinternetcafesareexemptfromcontributiontotheUASF.Othersourcesoffinancingcanincludegovernmentcontributionsandgrantsfromdevelopmentpartners(internationaldonors).
Thefund’sobjectivesaretopromoteinvestmentintheprovisionofserviceinruralareasatafairandaffordableprice.Theshort-termtargetsfortelephonyaretoenabletheestablishmentofapubliclyaccessibletelephonewithinalllocaleswithmorethan1,000inhabitantsaswellaswithinfivekilometresofeveryruralinhabitant.Theshort-termtargetsforinternetservicesaretoextendinternetpointsofpresenceandpublicaccesstotheinternetthroughtele-centrestoallDistrictCentres.Theservicesinfocusare:
• Providingtelephonyandinternetservices• Publicandprivateinternetaccess
andservice• Infrastructuredeploymentand
serviceprovision
hospitalsandschoolslocatedinruralareascanalsobenefitfromthefund.
Tendersareawardedthroughacompetitivebidbasedontheleastsubsidyrequestedfromqualifiedbidders.ProjectsareselectedandspecifiedbytheUSAF/INCM.Operatorsdonotparticipateinthedecision-makingprocessnordotheyhaveanysignificantinfluenceoverthespecificationsoftheprojects.
4.2.4 cuRRent status Of tHe fund
Thefundismoderatelyactive.Itbeganitsoperationonlyrelativelyrecently,in2008,andhasbeenslowintermsofactivityandtake-up.Sofar,ithasnotbeenabletoachieveoperationsofscaleinextendingvoiceandInternetcoverage,whichispartlyduetotherealityofthelimitedcompetition
inthetelecommunicationsmarket,withonlytwoactivelargeplayersupto2011.InOctober2012,afterconsiderableinactivity,thefundannouncedtheallocationofanewproject:theprovisionofserviceto50localesinthreelots:North,CentralandSouthZonesbutnoawarddetailhasbeenprovidedtodate.
InMarch2014,itwasannouncedthatFSAUplansfor2014hadbeenapproved.Thisplanincludesimplementationoftelecomservicesaswellastrainingin62townsintheprovincesofMaputo,Gaza,Inhambane,Sofala,Manica,Tete,Zambézia,Nampula,NiassaandCaboDelgado.Noadditionaldetailhasbeenprovidedatthisstage.
TheestimatedamountheldintheaccountwasUS$3millionin2009.Noadditionalinformationregardingthecollectionanddisbursementoffundshasbeenreportedpubliclysincethattime.
4.2.5 WHat tHe fund Has acHieved tO date
TheUniversalAccessprogrammebeganwithtwopilotprojects:
• Atelephonypilotprojecttoextendtransmission,accessnetworksandUAservicestoonezoneofthecountry,coveringfivedistrictsintheprovinceofZambéziaandthreedistrictsintheprovinceofNampula.
• AninternetservicepilotprojecttoprovideanadvancedlevelofservicetofourDistrictCentresintheprovincesofZambéziaandNampulathroughtheprovisionofInternetPOPs,withaminimumserviceradiusof5km.fromtheDistrictCentre.
AbiddingprocessfortheUApilotprojectswaslaunchedinFebruary2007.Thetelephonytenderdidnotreceiveanybidsandwasthereforeunsuccessful.TheInternettenderwaswonbytheMozambicanbroadbandwirelessoperatorINTRALda.
30
SSA USF STUDY
US$200,000wasdisbursedin2008foraprojectentailingthetransmissionofmobiletelephonyviasatellite,covering5kmfromthecentreoftheMatchedjedistrictinthenorthofthecountryontheTanzanianborder.
Bytheendof2009,grantsfromtheWorldBankconstituted13%oftheoverallfinancingofthefund.TheWorldBankhasfinancedcertaintele-centrespilotprojectsandoneCommunityPublicInternetAccessPointproject(PublicandprivateInternetaccessandservice).
MCelwonatenderinJune2011tobuildBTSsitesin14locales,inaprojectworthapproximatelyUS$4million.MCelhadninemonthstobuildthesites.
4.2.6 OtHeR eleMents Of inteRest
Thelackofdynamiccompetitioninthecountry’stelecommunicationsmarket,whichisstilldominatedbythestate-ownedTDManditssubsidiaryMCel,combinedwithMozambique’schallenginggeography,with62%ofitspopulationsituatedinrural,andoftenremote,poorareas,isnotconducivetoarapidincreaseinvoicetelephonyorInternetcoverage,despitethesubsidiesgraduallybeingofferedthroughtheUniversalAccessServiceFund.
General assessment:Furtherexpansionandmodernisationofthefixed-linetelephonenetworkisneeded;networkqualityremainsaproblem.
domestic telecommunications is as follows21:Theadditionofasecondfixed-lineproviderin2002resultedinfastergrowthbutsubscribershipremainsonlyabout1per100persons;mobile-cellularservicesgrowingrapidly,inpartrespondingtotheshortcomingsofthefixed-linenetwork;multiplecellularprovidersoperatenationallywithsubscribershipapproaching60per100personsin2010.
• Approximately0.4Mfixed-lines(2012)22
• Wirelinemarketpenetration23(yE2012):0.5%• Mainfixed-lineoperators:Nitel(bankrupt)
andGlobacom
Mobile (cellular) communications:
• 112.8Msubscribers24(yE2012)• WirelessmarketpenetrationyE2013:75%25
• 4MainOperatorsand4smalleroperators26: •MTNwithapproximately44%market
share •GloMobile,ownedbyGlobacom,
withapproximately20%marketshare • Airtel,ownedbyBhartiAirtel,with
approximately20%marketshare •Etisalat,ownedbyEtisalatandMubadala,
withapproximately13%marketshare •Others’totalmarketshare–3%
20. CIA World Factbook 201421. Id.22. Id23. Global Wireless matrix 1Q201224. Id.25. Id.26. Id
31
4.3.1 cOuntRy OveRvieW
NigeriahasoneofthelargestpopulationsinAfrica.ItislocatedinWesternAfrica,borderingBenin,Cameron,ChadandNigerwith853kilometresofcoastlineontheGulfofGuinea.Nigeriaconsistsofavariedterrainwithsouthernlowlands,centralhillsandplateaus,mountainsinthesoutheastandplainsinthenorth.ThepopulationofNigeriaisestimatedtobemorethan177million,makingittheseventhmostpopulouscountryintheworld.Approximately50%ofthepopulationisurban,withthe50%ruralpopulationoftensituatedinremoteareas.Nigeria’smostpopulatedcitiesare:Lagos-10.2million;Kano-3.3million,Ibadan-2.8million;Abuja,thecapital-1.9million;andKaduna-1.5million.
4.3
niGeRia
4.3.2 cuRRent status Of telecOM MaRket
niGeR
caMeROOn
cHad
benin
Mali
abuja
kaduna
kanO
laGOs
ibadan
Gulf Of Guinea
NIgErIA’S gDp pEr CApITA (ppp) IS
US$2,800 (2013 ESTImATE).20$
SSA USF STUDY
32
SSA USF STUDY
internet27:
Inthepast10years,therehasbeenasurgeinInternetusageandwhere,in2000,usagewasat0.1%;by2011thiswasestimatedtobeatleast44%28.Dataserviceshavealsowitnessedstronggrowthoverthepast10years,Internetusersasapercentageofpopulationhavegrownfrom0.3%in2002to28%in2011.however,Internetpenetrationat28%isstillrelativelylowandthegrowthofthesectorisstilldependentoninvestmentoninfrastructure.29
Nigeriastartedliberalisationofitstelecommunicationsmarketin1992andistodayoneofthemostopentelecommunicationsmarketsinAfrica.TheNigerianCommunicationsCommission(NCC)wasestablishedin1992astheindependentregulatorybodyfortheNigeriantelecommunicationsindustry.Thetelecommunicationspolicywasputintoplayin2000,acceleratingasweepingliberalisationthathasledtohundredsofcompaniesprovidingvirtuallyallkindsoftelecomandvalue-addedservices.
Nigeriahasbeendominatedbytheincumbentstate-ownedoperatorNitel,whichhasnotyetbeenprivatisedinspiteofthreeattemptsinthepast(likelyduetoitsperilousfinancialstate).Theadditionofasecondfixed-lineprovider,Globacom,in2002resultedinfasterfixed-linegrowthbutsubscribershipremainsatonlyabout1%.Today,thereareapproximately80otherfixedlicenseesprovidingservices,mainlythroughfixedwirelessconnections.Further
expansionandmodernisationofthefixed-linetelephonenetworkisneededasnetworkqualityremainsasignificantproblem.
Althoughmobile-cellularserviceshavebeengrowingrapidly,therelativelyhighpenetrationisasaresultofmultipleSIMownership.ThegrowthhassloweddownsomewhatfollowingthemandatorySIMcardregistrationin2011.
4.3.3 fund backGROund
TheNigerianCommunicationsActof2003addressestheconceptofuniversalaccessanduniversalservice;providesguidancetotheNigerianCommunicationsCommission(NCC)onthedevelopmentofuniversalaccess/servicepolicies;anddirectstheestablishmentofaUniversalServiceProvisionFund.TheNigerianUniversalServiceProvisionFund(USPF)wasestablishedin2007,asaseparateentityinaccordancewiththe2007UniversalServiceandUniversalAccessRegulations.ThefundismanagedbytheSecretaryoftheUSPF.
The2007RegulationsalsoestablishedaUSPBoard(ChairedbytheMinisterwithrepresentationfromtheNCC)tosuperviseandprovidebroadpolicydirectionforthemanagementoftheUSPFaswellastoaidtheUSPFundmanagers.IthastheauthoritytoappointandremovetheUSPFundmanagersandauditorsinconsultationwiththeNCC.TheBoardisentrustedwith
27. CIA World Factbook 201428. Insights to the African telecom market 2011: Analysis, Forecasts and Commentary, by telecomsmarketresearch.com, in association with buddecomm, August 201129. Universal Service provision Fund – Strategic management plan (2013-2017) June 2012)
USErS: 44.0m
(2009)
hoSTS:1,234 (2012)
33
SSA USF STUDY
approvingstandingorderstoestablishandregulateactivitiesoftheUSPfundmanagers,aswellasapproveallprocesses,procedures,guidelinesanddecisionsnecessarytoimplementtheregulations.TheUSPfundmanagersreportonaquarterlybasistotheUSPBoardandtheUSPSecretariatonthestatusofthefund,includingareportdetailingthefinancialsituationandperformanceofthefund.
TheNCCplaysthefollowingrolesinrelationtotheUSPF:
• Considers,designsanddeterminesasystemwhichshallpromotethewidespreadavailabilityandusageofnetworkservicesandservicestounservedandunderservedpartsofthecountry.
• IsrepresentedontheUSPFBoard(USPFSecretariatislocatedwithinthepremisesoftheNCCheadOfficeinAbuja)andisconsultedontheappointmentofUSPFmanagers.
• SupportstheFundonstaffing.
• EnsuresthattheUSPFisatalltimestotallyseparatedfromtheCommission’sFundandtransparentlymaintained.
• Developsregulationsregardingcontributionsbylicensees,undertheNCA,2003,totheUSPFandanyothermattersrelatedorincidentaltotheUniversalServiceProvisionandtheestablishmentandoperationoftheUSPF.
BoththeActandtheRegulationsprovidethattheUSPFundshallbeauditedeachfinancialyear.TheActprovidesthatindependentauditorsshallbeappointedbytheBoardandthattheauditor’sreportshallbepresentedtotheNationalAssemblyandpublished.TheUSPBoardisrequiredtoprepareandsubmitanannualreporttotheNationalAssembly,throughthePresident,nolaterthansixmonthsaftertheendofeachfinancialyear.Inaddition,theUSPFundmust
maintainawebsiteandincludepostingoftheFund’squarterlyreports,theUSPBoardannualreportsandprojectsunderway.
BeforethecreationoftheUSPFin2007,anAnnualOperatingLevy(AOL),requiredbylicenceconditions,hadbeencollectedbytheNCC.Basedonthe2007Regulation,theNCCmakesfinancialcontributionstotheUSPFbasedonaportionoftheAOLpaidtotheCommissionbylicensees.OperatorscontinuetosubmitanAOLof2.5%ofnetoperatingrevenuestotheNCConaquarterlybasis.TheNCC,inturn,contributes40%oftheAOLtotheUSPFforitsactivities.The2007RegulationsprovidethattheinitialamountoftheUSPContributionsshallbeequaltoonepercentofnetrevenuesofthelicenseesfromwhichtheNCCcollectsannuallevies(thisiscurrentlythe40%ofthe2.5%AOL).NCChasthediscretiontoincreaseordecreasethecontributiontotheUSPFuponconsiderationoftheUSPFoperatingexpensesandbasedonrecommendationsmadebyUSPF.
TheUSPFisalsosupposedtobefundedfromothersources:
• SuchmoniesasmaybespecificallyappropriatedtotheUSPFfromtimetotimebytheNationalAssembly.
• Gifts,loansaidsandsuchotherassetsthatmayfromtimetotimespecificallyaccruetotheUSPF.
however,sectorcontributionshavemadeupmostoftheFund’scontributions.Theobjectiveofthe2003CommunicationsActistoencouragetheinstallationofnetworkfacilitiesandtheprovisionofnetworkservicesandapplicationstoinstitutionsinunservedandunderservedareasorforunderservedgroups.TheSecretariatdeterminesiftheUSPFundistobeusedtofinancethemaintenanceofexistingservicesandnetworkfacilitiesforareasoronlytheprovisionofnewnetworksandservices.
34
SSA USF STUDY
Accordingtothe2007Regulations,theprioritiesoftheFundaretoprovidefinancialsupportforensuringuniversalaccessanduniversalservicetospecificareasdefinedasfollows:
• Unservedareas,whicharegeographicareaswherethereisnolevelofaccesscurrentlyavailable.
• Underservedareas,whicharegeographicareaswheresomelevelofaccessmaycurrentlybeavailable,butnotacrosstheentireregionalsegment.
• Underservedgroupswithinacommunity,whichreferstoadesignatedpopulationsegmentthatsharesacommonsetofcharacteristicsand,unliketherestofthecommunity,doesnothaveuniversalaccess.
UniversalServicecoversthefollowingservices:
• Individualmobile-cellularservice• Publicmobilepayphoneservice• Broadband• Tele-centres• Schools(primary,secondary
post-secondary)• healthcentres• Emergencyservices• Specialservicesforpersonswith
disabilitiesandelderpersons• Communitycentres• Governmentoffices
TheUSPSecretariatisrequiredtoundertakeananalysistodetermineformallywherefundmoneyshouldbedirectedand,specifically,theservicescopetobeapplied.
Intheallocationprocess,theUSPFshallusecompetitiveselectionprocesses,whichmayincludeminimumsubsidyauctionsorsuchotherprocessesdesignedbytheUSPSecretariatinaccordancewiththeRegulations.TheUSPFhasusedthefollowingmethods:
• Competitive,combinationqualityandcostselection.
• Competitive,leastsubsidyrequestedfromqualifiedbidders.
• ProposalbyeligiblecandidatesandevaluationbytheUSPF.
TheindustryisinvitedtoparticipateintheconsultationprocessontheRFI/RFPbutthefinaldecisiononprojectsismadebytheUSPFboardontheadviceoftheNCC.
4.3.4 cuRRent status Of tHe fund
TheUSPFisoperationalandactive.Previously,thefundhasfourprogrammes,namelytheUniversalAccessProgramme,UniversalCoverageProgramme,UniversalServiceProgrammeandICTforDevelopmentProgramme.Thelatterincludedissuessuchasapplications,content,softwareandtraining,unliketheUniversalAccessandServiceProgrammes,whichdealprimarilywithfundingofservicesandnetworks.
Until2011,themainfocusofthefundhadbeenonBTSprojectscoveringunservedandunderservedareas,providingupto25%subsidiesfortowerbuilding.
Thelatestpublishedbids(publishedontheUSPFwebsiteon26September2011)included:
• ProvisionofBackboneTransmissionInfrastructure(BTRAIN)Project
• ConstructionofPassiveTelecommunicationsInfrastructureforPurposeofCo-LocationofTelecommunicationCompaniesinRural/UnservedCommunities
• EstablishmentofBaseTransceiverStations(BTS)in(Rural)Unserved/UnderservedAreasoftheFederation30
30. http://uspf.gov.ng/index.htm
35
SSA USF STUDY
ThecurrentamountintheUSPFaccountisnotpubliclyavailable.Thereportedbalancein2009,tobecarriedforwardto2010,wasNairaNGN23.6B31(US$145million).
Notwithstandingtheongoingactivitiesofthefund,thefundadministrators,aswellasthenewMinisterofCommunications,appeartorecognisethatthefundisnotperformingasitshouldandthatsomemajoradjustmentsarerequired.Tothatend,theyarecurrently(asofMay2012)32intheprocessofredefininghowtheFundshouldoperate.
4.3.5 WHat tHe fund Has acHieved tO date
Between2009and2012,thefundfocusedon:
• USPFBTSSupportProject• CommunityCommunicationsCentre• ComputerfortheGirlChild• LargeScaleICTProjects• ICTforAllNigeriansProject• AcceleratedMobilePhoneExpansion
Project• BackboneInfrastructureProject• SchoolandUniversityAccessProjectsto
DigitalLifestyles
Asmentionedpreviously,themainfocusofthefundwastheBTSSupportProjectforunservedandunderservedareas.Thisparticularfocushasbeenquitesuccessful,asoperatorshaveleveragedontheinitiativetoextendservicestolocationsconsideredtobecommerciallydisadvantageous.MajormobileoperatorsparticipatedintheBTSprojects,receivingasubsidyof25%ofthecostofbuildingabasestation(approximatelyN8,897,040.00–US$54,300).
TheotherprojectsthatdeliveredsomeresultshavebeentheSchoolandUniversityAccesstoDigitalLifestyleProject,whichbroughtinternetconnections,expectedtoimprovelearningandresearchbytheteachersandstudents,toFederalUniversities;
andtheComputerfortheGirlChildprojectfacilitatingaccesstoICTbypupilsinsecondaryschoolsacrossthecountry.
TheUSPF2007-2011StrategicPlancitedthesetypesofprojectseligibleforUSPFfinancing:
• LargescaleICTprojects.• Communitycommunicationscentres
(CCC)projects.• ICTsforallNigeriansproject.• Acceleratedmobilephoneexpansionproject.• Backboneinfrastructureproject.• Enablingenvironmentprojects.• Schoolanduniversityaccessprojectsfor
digitallifestyle.• Institutionaldevelopmentprojects.
Inthe‘ApprovedStrategicManagementPlan(2013–2017)fortheUniversalServiceProvisionFund’publishedinJune2013),thefollowingprojectswereidentifiedwithmoresubstantiveinformationprovided:
• Communitycommunicationscentres(CCC)projects:224CCCsestablishedacrossthesixgeopoliticalzones,achieving77%ofthesettarget(291).
• Acceleratedmobilephoneexpansionproject:Thefirsttargetwastohave490BaseTransceiverStationsby2011.TheUSPFawardedsubsidiesfor74BTS,62ofwhichhavebeenimplementedwhile12arestillinprogress.Thisrepresents12%ofthesettarget.Thesecondtargetwastoencourage/subsidisetheconstructionofsharedtelecominfrastructureforco-locationoftelecomoperators.Thetargetwas150CIPs.TheUSPFsubsidisedtheestablishmentof104CIPsachieving69%oftheplannedtarget.
• Backboneinfrastructureproject:(theBTRAINproject)aimedatacceleratingthroughsubsidiesthebuild-outofbackbonetransmissioninfrastructuretoalllocalgovernmentareasinNigeria.Thetargetwastoachieve1000km.offibrebackboneinfrastructure.TheUSPF
31. 2009 Annual report – last annual report that has been published on the USpF website32. http://www.piftikhar.com/2012/05/my-first-visit-to-nigeria/
36
SSA USF STUDY
hasrecentlyconcludedthattheprocessfortheBTRAINPilotProjectachievedthedeploymentof500km.offibreattheendof2012.
• Schoolanduniversityaccessprojectsfordigitallifestyle(TheSchoolAccessproject(SAP)aimedatprovidingpublicschools(1,858schoolstargeted)withICThardwareandfundingsubscriptionsforbroadbandinternetforatleastoneyear.TheSAPhasbeenrolledoutto766governmentschoolsrepresenting41%achievementofsettargets.TheTertiaryInstitutionAccessProject(TiAP)aimedatprovidingtertiaryinstitutions(374institutionstargeted)withICThardwareandfundingsubscriptionsforbroadbandinternetforatleastoneyear.TheTiAPhasbeenrolledoutto193oftheinstitutionstargeted.
• Institutionaldevelopmentprojects(TheE-Libraryprojectwastoprovideinternetaccesstopubliclibrariesinunderserved/unservedareas.Therewasnospecifictargetfortheproject.Attheendof2012,theE-libraryhasbeendeployedto74librariesacrossthecountry).
• RuralBroadbandInitiative(RUBI)projecttofacilitatetherolloutofbroadbandservicestounderservedandunservedareas.Thetargetwastoestablish109RUBIinitiativesacrosssenatorialzonesinthecountry.Theprojecthasbeenrolledoutto18areastofacilitateaccesstohighspeedinternet.
4.3.6 OtHeR eleMents Of inteRest
Thehighlycompetitivetelecommunicationsmarketisthemainreasonbehindtheachievementofthecountry’scurrentcoveragelevelsratherthanthefundinitiatives.Muchoftheremainingaddressablemarketisinthecountry’sruralareaswherenetworkrolloutsandoperationsareexpensivemainlyduetothepoorinfrastructureinplace,lackofreliableelectricity,securityrisksandunreliabilityoftheincumbent’sfixednetwork.GiventhatruralpenetrationinNigeriaisstilllow,withover40Minhabitantsstillresidinginruralareas,thereisaneedtodevelopmorecomplexincentivesthatwilladdresstheabovefactorsandhelptodecreaseoperators’capitalandoperatingexpenses.
General assessment35:ThesystemisthebestdevelopedandmostmoderninAfrica.
domestic telecommunications:Combinedfixed-lineandmobile-cellulartele-densityisroughly110telephonesper100persons;consistsofcarrier-equippedopen-wirelines,coaxialcables,microwaveradiorelaylinks,fiber-opticcable,radiotelephonecommunicationstations,andwirelesslocalloops;
• Approximately4.0Mfixed-lines(yE2012)36
• Wirelinemarketpenetration37
(yE2011):9.0%
• Onemainfixed-lineoperator:TelkomSouthAfrica
Mobile (cellular) communications:
• 68.4millionsubscribers38(yE2012)
• WirelessmarketpenetrationyE2013:138.0%39
• ThreeMainOperators40: • vodacomwithapproximately44%
marketshare •MTN,withapproximately35%
marketshare • Cell-C,ownedbyOgerTelecom,with
approximately18%marketshare •TelkomMobile,withapproximately
2.3%marketshare
4.4
sOutH afRica
33. CIA World Factbook 201434. Id.35. Id.36. CIA World Factbook 201437. Global Wireless matrix 1Q201238. Id.39. Id.40. Id
37
SSA USF STUDY
4.4.1 cOuntRy OveRvieW
TheRepublicofSouthAfrica,generallyreferredtoasSouthAfrica,coversamassivelandareaofover1millionsq.km.ThecountryissituatedatthesoutherntipoftheAfricancontinentandbordersBotswana,Lesotho,Mozambique,Namibia,SwazilandandZimbabwe.SouthAfrica’spopulationisestimatedtobeover48million.Urbanpopulationaccountsforover60%ofthepopulation.Populationinthemajorcitiesis:3.6millioninJohannesburg;3.3millioninCapeTown;3.1millioninEkurhuleni;2.8millioninDurban;and1.4millioninPretoria,thecapitalcity33.
bOtsWana
les.
sWaz.
MOzaMbique
ziMbabWe
naMibia
caPe tOWn
PRetORiajOHannesbuRG
duRban
4.4.2 cuRRent status Of telecOM MaRket
SoUTh AFrICA’S gDp pEr CApITA (ppp) IS
US$11,500 (2013 ESTImATE).34$
38
SSA USF STUDY
TheSouthAfricantelecommunicationsmarketisoneofthemostmodernandbestdevelopedmarketsinAfrica.In1996,theTelecommunicationsActwasamendedandformedthebasisofthemarketliberalisationandprivatisationofthestate-ownedfixed-lineproviderTelkom.TheIndependentCommunicationsAuthorityofSouthAfrica(ICASA)wassetupin2000andhasbeentaskedwiththeadministrationofgovernmentpolicy,issuinglicences,frequencymanagementandtheimplementationoftheTelecommunicationsAct.TheElectronicCommunicationsActof2005introducedaconvergedunifiedlicensingregimeandwitnessedthesurgeofhundredsofalternativeserviceproviders.
Today,therearefixed-linesprovidedmainlybyTelkom,thestate-ownedoperatorwhohadamonopolythroughto2006.Thesecondfixed-lineoperator,Neotel,majority-ownedbyIndia’sTataCommunications,hasonlyrecentlystartedtopickupandcurrentlyboostswithamarketsharebelow15%.
ThegovernmentismakingeffortstoenhancethebroadbandofferingthroughthenewlycreatedBroadbandInfraCo,anationalinfrastructurecompany,whichistoprovidecheapbackbonenetworkcapacitytoserviceproviders,fibretothehome.however,thisinitiativehasbeenveryslowtotakeoff.however,hopesareputinto3GmobilebroadbandwhichisslowlysurgingaheadofDSL.
4.4.3 fund backGROund
TheoriginalUniversalServiceAccessFund(USAF)wasoriginallysetupin1997inaccordancewiththe1996TelecommunicationsAct,asamendedin2001,andtheassociatedUSAFRegulationsof1999.TheElectronicCommunicationsActof2005(ECA)establishedtheUniversalServiceandAccessAgencyofSouthAfrica(USAASA),aseparatelegalentityresponsibleforpromotinguniversalserviceandaccessinthecountry,toadministertheUSAF.TheUniversalServiceandAccessFundContributionsRegulation(GovernmentGazetteNo.34010of10February2011)prescribetheannualcontributionstobepaidtotheUSAF.TheMinisterofCommunicationsappointstheUSAASABoard,whoretainsthefullandeffectivecontrolandmonitorstheexecutivemanagementanddecisionsoftheAgency.
howeverduetothewidespreadallegationsofcorruptionandmismanagement,seniormembersofthefundmanagementteamweresuspendedinSeptember2011,andaforensicauditwasordered.Subsequently,someofthesuspendedmembersunderinvestigationresigned;theMinisterappointedanewboardinSeptember2012andconductedasearchforanewCEO.
USAASAisfundedbycontributionsfromlicensedoperatorsofelectroniccommunicationservicesandnetworks.BroadcastinglicenseesalsocontributetotheFundoroffsetthecontributionagainst
41. CIA World Factbook 2014
USErS: 4.4m (2009)
hoSTS:4.8m (2012)
internet41:
39
SSA USF STUDY
acontributiontoabroadcastingsectorMediaDevelopmentandDiversityFund(“MDDA”).TheNRA,ICASAcollectsthecontributionsfromlicenseesandsendsthemtotheNationalTreasury.ICASAdeterminesthebasisofoperators’contributions,whichmaynotexceedonepercentoftheirannualturnover.Currently,basedonthe2011USAFContributionsRegulation,thecontributionissetat0.2%ofannualturnover,paidonanannualbasis,whichisdefinedastotalrevenuefromlicensedactivity,lessserviceproviderdiscounts,agencyfees,interconnection,facilitiesleasingcharges,governmentgrantsandsubsidies.Section88oftheECAstipulatesthatthefundshouldbeusedexclusivelyforpaymentofsubsidiesinthefollowingmanner:
• Toassistneedypersonstowardsthecostofprovisionto,ortheuseby,themofbroadcastingandelectroniccommunicationsservices.
• TopublicschoolsandpublicFurtherEducationandTraining(FET)Institutionsfortheprocurementofbroadcastingandelectroniccommunicationservicesandaccesstoelectroniccommunicationnetworks.
• Fortheestablishmentandoperationofbroadcastingservicesandfortheestablishmentandoperation,includingtrainingofandthepaymentofallowancestopersonnel,ofcentreswhereaccesstoelectroniccommunicationnetworkscanbeobtained.
• Toanybroadcastingservicelicenseeandelectroniccommunicationsnetworkservicelicenseeforthepurposeoffinancingtheconstructionorextensionofelectroniccommunicationsnetworksinunder-servicedareas.
Projectsareawardedthroughacompetitivebid.USAASAmanagesthefundsandidentifiessuitableprojectsintermsoftherequirementsofECAthatareeligibleforasubsidy.
Oneofthemainareashasbeentoprovideincentivestoelectroniccommunicationsnetworkservicelicenseestoconstructoperateandmaintainelectroniccommunicationsnetworksinunderservedareasthroughtheawardofprojectgrants.ForthedisbursementofUniversalServiceFundsunderthisapproach,USAASAappliesarangeofcriteriaincluding:
• Thescopeoftheelectroniccommunicationsnetworkservicelicensee’sproposal,includingtheelectroniccommunicationsnetworkproposedforconstructionintheunderservedareaandthespecifictechnologiesproposed;
• Anyelectroniccommunicationsservicestheelectroniccommunicationsnetworkservicelicenseeproposestoofferintermsofitselectroniccommunicationsservicelicenceorotherlicenceheldbytheelectroniccommunicationsnetworkservicelicensee;and
• Termsandconditionsrelatingtoanyproposedservices,includingwholesaleandretailpricing,consideringthelackofcompetitiveelectroniccommunicationsnetworksandservicesinthetargetedunder-servicedarea.
40
SSA USF STUDY
4.4.4 cuRRent status Of tHe fund
TheUSAASAiscurrentlyactiveafterahiatusperiodwhilstaforensicauditwasconductedandthefundmanagementwaschangedinitsentirety.DuringthattimeadetailedUSFoperatingandfundingmanagementmanualwasestablished.Thefundisnowfocusingonfourkeyareasorinitiatives42asfollows:
a. Rapid deployment
Thisprogrammeisintendedtoestablish30newschoolcyberlabsconnectedtotheinternet.USAASAhasinvitedlicensedserviceprovidersthroughacompetitivebiddingprocesstoconnectschoolsintheseunder-servicedareas.
b. connectivity
Thisprogrammeseekstoensure260accesscentresincludingschoolcyberlabsandtele-centresareconnectedtosubsidisedinternet.
c. broadband networks
Twounder-servicedmunicipalitiesinEmalahleniLocalMunicipalityintheEasternCapeandMsingaLocalMunicipalityinKwaZulu-Natalaretherecipientsofthebroadbandnetworkproject.ThestakeholderengagementforbothuMsingaLocalMunicipalityinKwaZulu-NatalandEmalahleniLocalMunicipalityintheEasternCapewasfinalised.Additionally,MTNwasappointedtocommencetherolloutandoperatethebackbonenetworkduringthefourthquarterof2014.Thisprojectentailsconnectingthreeschoolstobechosenbyeachmunicipality.AhospitalandmunicipalofficeswillalsobeconnectedandCustomerPremisesEquipment(CPE)suchasthe3Grouterwillalsobesupplied.
Inordertofurthermoveaheadthebroadbandinitiatives,thefundissuggestingathreephaseimplementationapproach:
• Phase 1:Constructthenetworktocoverthemaintownsfirst,providingservicestoGovernment,localbusinessandhouseholdsinthoseareas.
• Phase 2:Extendthenetworktoreachimmediatevillagesaroundthemaintowns.
• Phase 3:Extendthenetworktoreachallothervillagesandfarmsthroughoutthemunicipality.
d. digital terrestrial television
TheimplementationoftheDigitalTerrestrialTelevision(DTT)programmeishamperedbythelegalchallengestotheMinisterofCommunicationsduetotheimplementationoftheconditionalaccesscontrolimposedonthesubsidisedset-topboxesfordigitalterrestrialbroadcastinginSouthAfricathroughtheBroadcastingDigitalMigrationPolicy(GovernmentGazetteNo.31408dated8September2008).
TheslowpaceontheDTTproject,whichaccountsfor84%oftheUSAF,budgetimpactsonUSAASA’sresponsibilityareaonthisProgramme.USAASAisdependentontheDepartmentofCommunicationstocompletetheprocessofappointingthemanufacturersoftheset-topboxes(STBs)forittoimplementsubsidydisbursements.ThesubsidiesfortheDTTprojectareintendedforsubsidisationof4.5millionpoorhouseholdswhowouldfinditverydifficulttoaffordSTBs.
42. USAASA’s Status Update of the Universal Service and Access Fund Operational Activities march 2014
41
SSA USF STUDY
43. the relevance of public access services and universal service obligations in light of increased mobile market penetration – Dr. Kammy Naidoo Lirneasia November 2011
ThetotalamountcurrentlyheldintheUSAFisnotpublicallyavailableandvariousestimatescontinuetoexist.AccordingtotheUSAASA2009/2010AnnualReport,thelatestpublishedsurplusforyear2010wasR15.4M(US$1.8million).Estimatedoperatorcontributionsin2010fromothersourceswereintheneighbourhoodofR225.0M(US$27.1million).
ThefollowinggraphshowsoneassessmentoftherelationshipbetweenthelevelsofoperatorcontributionsreceivedversusthelevelofdisbursementsachievedbytheFund43.ThistranslatesintoanestimatedamountofbetweenUS$27.4millionandUS$30.4million.
Operator contributions expenditure
OPeRatOR cOntRibutORs veRsus usaasa exPendituRe
Source: Lirneasia
2004 2005 2006 2007 2008 2009 20100
50,000
100,000
150,000
200,000
250,000
r’0
00
42
SSA USF STUDY
Since2010,theoverallGovernmentalPolicyonUniversalServiceandAccessObligationhasbeenunderreviewandsubjecttoaconsultationprocesspublishedbyICASAon17August,2010.AttheheartofthedebateiswhetherSouthAfricashouldretainasystemofimposingUniversalServiceandAccessObligationsonlicenseesorwhetheritshouldadoptapurelycompetitiveprocessusingfundsfromtheUSAFandlettingoperators
voluntarilyassumeobligationsthroughselectedsubsidisedprojects.BasedonthelatestinformationavailablebythenewlyrejuvenatedUSAASA,availablefundsappeartoberatherlimitedasperthisrecentreportbelow44.Itisalsoimportanttonotethatwhilethisreflectscurrentstatus,thereisnoindicationregardingwhathappenedtothepreviouslycollectedfunds.
44. USAASA Strategic plan 2012-2015 – Final as published in the website
accRual
financial PeRfORMance data 2012/13 2013/14 2014/15
R. tHOusands MediuM - teRM estiMate
Revenue
INTeresT 112 124 136
deparTmeNT of commuNIcaTIoNs 273,977 289,046 291,988
tOtal Revenue 274,089 289,170 292,126
exPenses
adverTIsINg – – –
audIT cosTs 762 717 857
baNk cHarges 27 29 31
coNTracTors – – –
researcH aNd developmeNT – – –
Travel aNd subsIsTeNce 2,165 2,539 2,693
exPenses
sTraTegy documeNT & maNual 2,850 – –
HaNdover of eac
e- coNNecTIvITy 11,400 9,310 8,550
rapId deploymeNT 10,000 15,000 20,000
sTb subsIdIes 230,000 240,000 240,000
broadbaNd INfrasTrucTure 16,885 21,575 19,995
tOtal exPenses 274,089 289,170 292,126
43
SSA USF STUDY
4.4.5 WHat tHe fund Has acHieved tO date
TheUSAASAhasbeenactivewithmixedresults.Itstarteditsactivity,includingfundsdisbursementin1998.historically,USAASAhasbeenseenasa‘Tele-centre’AgencyandinvolvedonlyinsmallinitiativessuchasTele-centreandCyberlabprojectsandthefundingofUnder-servicedArealicensees.Thesedidnotachievethepenetrationlevelsexpected.45
under-serviced area licencesInNovember2001,amendmentstotheTelecommunicationsActcreatedanewlicencecategory,the“under-servicedarealicence”(USAL).Thegoalwastostirthegrowthoftelecommunicationsservicesinunderservedareas,whichweredefinedasareaswithlessthan5%tele-densityduringaperiodofthreeyears.Underthescheme,certainsmallandmedium-sizedenterpriseswereallowedtoapplyforlicencestoprovidetelecommunicationsservicesintheseunderservedareas.TheUSALallowedthemtoofferservicessuchasvoIP,fixedmobileserviceandpublicpaytelephones.USALlicenseeswereneverthelessrequiredtotransporttheirlongdistancetrafficthroughthetrunknetworksofanyofthenationalfixedandmobileoperatorsand,internationally,throughthreedesignatedinternationalgatewaylicensees.
AfixedsubsidyofR15million(approximatelyUS$2million)wasgiventoeachofthesevenwinningbiddersfortheUnder-ServicedAreaLicence(USAL),tobeusedoninfrastructuredevelopmentforaperiodofthreeyears46.USALshavenotproventobefinanciallyviable.Afterin-depthreview,itwasdecidedthatfundingbesuspendeduntilasustainablemodelonthebusinesscase,regulatory,financialsupportandpolicywasdevelopedandin2007,thegovernmentdirectedICASAtomergeUSALsandissueoneProvincialUnder-ServicedAreaNetworkOperator(PUSANO)licenceinprovinceswherethereismorethanonelicence.TheECAobligedtheUSALstoconverttheirlicencesintoone
ofthenewcategoriesestablishedundertheAct.OfthesevenoriginallyUSALSthatwerelicensed,onlyonewasstillprovidingretailservicesbytheendof2009.
tele-centres and cyber-labs:Tele-centresareintendedtoprovidecommunitieswithawiderangeofservicesincludingcomputerservices,telephones,fax,Internetaccess,email,typing,printingandphotocopyinganduseofvideofacilitiessuchasvideorecordersandDvDplayers.SchoolCyberlabsareexpectedtoprovideICTservicesandcomputerliteracytrainingtotheschoolcommunity.TheschoolownstheCyberlabandisresponsibleforallmaintenancecostsexceptInternetconnectivityforthefirst12months.Theintentionisthat,thereafter,theschoolbecomescompletelyresponsiblefortheCyberlab.TheUSAASAisresponsiblefortheinstallationofnetworkpoints,airconditionersandprovidessecurityforthefacility.
TheUSAFwasintendedtoprovidesupportforthedevelopmentofaCommunityDigitalhub.ThisisaconceptofcommunitycentresdeployedinruralareasandisanadvancedICTfacilitytoprovidetechnicalsupporttoremoteTele-centresandCyberlabs.Thesupportprovidedbythehubincludescontentdevelopmentanddeliveryofvariousapplications(suchase-governmentservices,e-education,e-health,e-businessdevelopment,e-agriculture,etc.).
however,projectshavebeendelayed,roll-outhasbeeninefficientandtele-centresandcyberlabshavenotbeenconceptualisedtoremainsustainableandself-efficient.Inits2008/2009AnnualReport,USAASAreportedthatithadspentmorethanR150million(US$17.9million)overthepreviousfewyearsintherehabilitationandmaintenanceofthesefacilities.Theassessmentshowedthataccesscentresfacevariouschallengesincludinglackoftechnicalandmanagementskills,difficultsustainability,shortageofresources,governance,publicawarenessandpooruptakeandusageofthefacility.
45. USAASA 2009/2010 Annual report 46. USAASA 2009/2010 Annual report
44
SSA USF STUDY
In2009,USAASAinitiatedastrategyforthehandoverofcommunityICTAccessCentresandschoolCyberlabstotherelevantgroupsandtheDepartmentofEducation.Thehandoverwasdelayedasaresultoflongerprocurementprocesses.Bytheendof2010,onlythepriorityprojectswerecompleted(auditof154AccessCentres,rehabilitationofobsoleteequipmentandhandoverof100schoolsand38AccessCentres).
Duringthecourseof2010,USAFengagedinthefollowing:
• DisbursementofInternetaccesssubsidiestofacilitatetheprovisionofInternetconnectivitytoschoolCyberlabsandCommunityAccessCentresate-rated47or(50%discounted)prices.
• TendersfortherapiddeploymentofnewcommunityAccessCentresinruralandunder-servicedareas(withatargetof100centres)havebeenputonholdanddelayed.
• TheUSAFalsoundertookaprojecttodevelopaUniversalServiceandAccessFundManualsettingdownproceduresandtoprovideguidelinestobeneficiariesonhowtoaccessthefund.
• SubsidiesviaUSAFwereprovidedto18FurtherEducationandTraining(FET)collegesin2008–2010tofacilitateconnectivity.
Overall,tendershavebeendesignedforandsubsidiesallocatedtomediumandsmallsizelicensees(companiessuchasBrentlanaTechnologies,Wi-LinkTechnologies,AnnixTelecommsorSolariaTechnologies).Forexample,by2009,theUSAFhadprovidedR38.4M(US$4.6million)48tosmallandmediumblackeconomicempowermententerprisesofwhichR7Mwasspentonwomen-ownedenterprises.Thefourmajoroperators(MTN,vodacom,Cell-CandTelkom)donotappeartohavebenefitedfromfinancingbytheUSAF.
SouthAfrica’ssuccessinachievinghighpopulationcoverageandpenetrationisduetofactorssuchasaliberalisedandcompetitivemobiletelecommunicationsmarketsince1996,originalroll-outandpublicaccessobligationsinthemobilelicencesandhighdensitypopulationconcentrationswithmid-levelpercapitaincome.
MajoroperatorswereobligedtoprovisionahighnumberofCommunityServiceTelephonesinUnder-ServicedAreasundertheiroriginalMobile-CellularTelephoneService(“MCTS”)licencesissuedundertheTelecommunicationsAct,1996(subsequentlysubstitutedorconvertedintoECActlicences).Inexchangeforthe3Gspectrum,obligationswereimposedtoprovideInternetaccesstoinstitutionsofpersonswithdisabilities,plusterminalequipmenttofacilitatesuchaccess,andInternetconnectivitytothousandsofpublicschoolslocatedinrural,underservedandnon-servicedareas,plusterminalequipmenttofacilitatesuchaccess.Inexchangefortherighttothe1800Mhzspectrum,operatorsweremandatedtoprovideanddistributemillionsofSIMcardconnectionpackagesinunder-servicedareas.
47. Special discounted prices for Internet connectivity offered to certain public institutions 48. USAASA 2009/2010 Annual report
SSA USF STUDY
45
Basedonthelatestinitiativesnowthatthefundhasbeenre-activatedbuttheexpenditureshavebeenmodesttodate,thecurrentresultsareasfollows:
PROJECTNAME
ANNUALTARGET
ORIGIONALBUDGET
ROLLOvERAMOUNT
NEWTARGET PROGRESS
ExPENDITURETODATE
rapId deploymeNT 30schools R15.18M R4,374M 40schools+1centrefordisability
39schoolscompleted
R14.6M(us$1.4 million)
coNNecTIvITy 260centres R6.4M R4,832M 281centres 279connected
R5.6M(us$0.5 million)
broadbaNd 2municipalities R21M – – MTNappointedandstartedwork.Paymentwillbeintranches
nil
dTT 300,000STBs R240M R450M – None nil
4.5
uGanda
SSA USF STUDY
4.5.1 cOuntRy OveRvieW
AlandlockedcountryinEast-CentralAfrica,UgandaborderstheDemocraticRepublicoftheCongo,Kenya,Rwanda,SouthSudanandTanzania.Itsareaismadeupofmainlyplateauswitharimofmountainsandmanylakesandrivers.Uganda’sestimated35.9millionpopulationismainlyruralwithonly13%livingincities,outofwhichKampala,thecapital,has1.5millioninhabitants.
4.5.2 cuRRent status Of telecOM MaRket
General assessment50:Mobile-cellularserviceisincreasingrapidly,butthenumberofmainlinesisstilldeficient;workunderwayonanationalbackboneinformationandcommunicationstechnologyinfrastructure;internationalphonenetworksandInternetconnectivityprovidedthroughsatelliteandvSATapplications
domestic telecommunications51:Intercitytrafficbywire,microwaveradiorelay,andradiotelephonecommunicationstations,fixedandmobile-cellularsystemsforshort-rangetraffic;mobile-cellulartele-densityabout40per100personsin2010.
• Approximately315,000fixed-lines(2012)• Twomainfixed-lineoperators:UTL
andMTN
Mobile (cellular) communications:
• 14.4millionsubscribers52(yE2012)• MarketpenetrationyE2013:51%53
• FiveMainOperators •MTNUganda,withslightlymorethan
45%marketshare •Airtel,with40%marketshare •UT,with11% •ThebalanceisdividedbetweenOrange
andothers
46
49. CIA World Factbook 201450. Id51. Id52. CIA World Factbook 201453. GSmA Intelligence54. CIA World Factbook 2014
sOutH sudan
kenya
tanzania
lake victORia
deM. ReP. Of tHe cOnGO
kaMPalaUgANDA’S gDp pEr CApITA (ppp) IS
US$1,500 (2013 ESTImATE).49$
47
SSA USF STUDY
55. Insights to the African telecom market 2011: Analysis, forecasts and commentary, by telecomsmarketresearch.com, in association with buddecomm, August 201156. the Communications (Universal Service) regulations of 200557. rCDF Statement 2011
AlthoughUgandaisoneofthesmallestmarketsintheregion,itisalsooneofthefastestgrowingmarketsinAfrica.Itstartedtoliberaliseitstelecommunicationsmarketintheearly1990swhenCeltel(nowAirtel),asthefirstmobilecompanyinUganda,obtainedaCellularTelecommunicationsOperatorlicencein1993andlaunchedservicein1995.TheUgandaCommunicationsCommission(UCC)wasestablishedin1998bytheUgandaCommunicationsAct(Cap106LawsofUganda)tofacilitateandenablethedevelopmentofamoderncommunicationssectorandinfrastructureinthecountry.MTNenteredthemarketin1998,followedbyUgandaTelecom(UTL)in2001,WaridTelecomin2008andhiTSTelecom,inwhichFranceTelecom’smobileunitOrangeboughtamajoritystakein2009.55
Despitetheintensifiedcompetitionleadingtopricewars,whichhaveacceleratedsubscribergrowth,themarketpenetrationisstillwellbelowtheAfricanaverage.
4.5.3 fund backGROund
The1997UgandaCommunicationsActoutlinedtheprinciplesofuniversalserviceandenvisagedfinancingthroughaUniversalServiceFund.TheseprincipleswerethenincorporatedinthefirstRuralCommunicationsDevelopmentFundPolicyof2001.ThecurrentRural
CommunicationsDevelopmentFund(RCDF)wasestablishedundertheCommunications(EstablishmentandManagementoftheRuralCommunicationsDevelopmentFund)Instrument,2002,andhasbeenfullyoperationalsince2003.The2005Communications(UniversalService)RegulationsoutlineacomprehensiveuniversalservicepolicyforUganda.56TheregulationsnotedthattheUgandaCommunicationsCommission(UCC)wastosupporttheprovisionofuniversalserviceobligationsbytheoperators,andthattheUCCshallimplementtheuniversalserviceobligationsthroughtheRCDF.
TheRuralCommunicationsDevelopmentFundisaninternalunitandaccountmanagedbytheManageroftheRCDFundertheUCCwhoisresponsiblefortheestablishmentandoveralladministrationofthefund.TheUCCappointsaBoardthatconsistsofrepresentativesoftheUCC,includingtheChairmanoftheBoardandtheExecutiveDirector,theUgandaPostalsector,UgandaConsumerProtectionAssociation,UgandaInstitutionofProfessionalEngineers,theUgandaInstituteofBankersandtheMinistryofICT.TheBoardisresponsiblefortheexecutionofthestrategyfortheRCDF.TheBoardreportstotheUCCandmanagestheFundinaccordancewithUCC’sapprovedpoliciesandprocedures.UCCalsoappointsaRCDFmanagerandallocatesitsstaff.ThekeyroleoftheRCDFmanagerandhisunit
USErS: 3.2m (2009)
hoSTS:32,683 (2012)
internet54:
48
SSA USF STUDY
istomanagetheRCDFprogrammeandactivities,toimplementandadministertheprogrammeandtherelatedactivitiesandtomanagethefinancesoftheRCDF.
OneofthemainobjectivesofUCCistheenablingofUniversalAccess(UA)tocommunicationsinUganda.Priortoliberalisationofthecommunicationssector,UniversalServiceObligationswereincludedinlicencesofoperatorsandserviceprovidersforareasandservicesthatwerenoteconomicallyviable.Undertheliberalisedenvironment,operatorsaregenerallyfreetochooseareasthattheyoperatein.Theseareasaremainlydeterminedbytheireconomicviability,whilethoseareasthattheychosenottooperateinbecomeunderservedorunserved.57
Theuniversalserviceobligationisdefinedinthe2005Regulationsasaminimumsetofservicesofspecifiedquality,whichisavailabletoallusersindependentoftheirgeographicallocationatanaffordableprice,inparticular:
• Connectiontoafixedcommunicationnetworkabletosupportvoicetelephony,faxanddatatransmission;
• ReasonablegeographicaccesstopubliccallboxesthroughoutUganda;
• Abilityofconsumerstoaccessemergencyandfreeservices,operatorassistanceanddirectoryenquiryservices;
• Abilitytomeettheneedsofpeoplewithdisabilities;
• Deliveryofaffordablebasiccommunicationservicestoallcustomersuponreasonablerequest;
• Providecustomerswithdisabilitieswiththesameorequivalentservicesasallothercustomerssoastohaveaccesstothesamelevelofuniversalservice;and
• Reasonablegeographicaccesstobasicpostalservicesacrossthecountry;aswellasreasonablelevelsofaccesstopayphonesforallinUgandaonanequitablebasis.
Currentlyalloperators,includingthepostalservicecouriersandISPs,contribute1%58oftheirGrossAnnualRevenue,netofinterconnectionpayments,totheRCDF.TheRCDFmayalsoreceivefinancingappropriatedbytheUgandaParliamentthroughthenationalbudget,aswellasdonationsandgrantsfromdevelopmentpartners,andgiftsandloansdeemedacceptabletotheMinisterofICTandtheFinanceMinister.TheWorldBankhasprovidedabout30%ofthefinancingthroughitsgrants59.
Accordingtothe2005Regulations,theUCCcandesignateanoperatorasauniversalserviceproviderwhowouldthenhaveanobligationtoprovideuniversalservicesonanation-widebasisorinaspecifieduniversalserviceareaandoughttoestablishamechanismforsharingthenetcostsofsupportingtheuniversalserviceobligation(i.e.,differencebetweenthenetcostofoperatingforanoperatorwiththeuniversalserviceobligationandoperatingwithouttheuniversalserviceobligation)suchthattheuniversalserviceobligationdoesnotrepresentanunfairburden.UCCdeterminessubsidiesforeachuniversalserviceareawithrespecttoeachserviceobligation.
TheRCDFdevelopsappropriateICTprojectsfortheunderservedandunservedareas.RCDFthenformsPublicand/orPrivatePartnershipstoimplementthoseprojects.Normally,theRCDFcontributestechnicalsupportandasubsidyintothepartnership.Thepartnercontributesownershipandfinancialsupportamongstotherthings.ThepartnersareselectedonacompetitivebasisinaccordancewithprovisionsofthePublicProcurementandDisposalActof2003andtheprojectsarenormallyoperatedforaperiodoffiveyears.60Operatorscanaccess
58. UCC Determination based on the 2005 Communications (Universal Service) regulations outline a comprehesive universal service policy for Uganda59. ICt regulation toolkit, www.ictregulationtoolkit.org/en60. rCDF Statement 2011
49
SSA USF STUDY
thefundsthroughacompetitivepublicopenbiddingprocesswhenarequestforabidisissuedbytheRCDF.Thebidsareawardedmainlybasedontheleastsubsidyrequestedfromqualifiedbidders.AlthoughoperatorsarenotincludedinthegovernancestructureoftheRCDF,inpractice,theprojectselectionissharedwithoperators,e.g.,forrolloutrequirements,operatorscanindicateareasthatarealreadycoveredorthattheyplantocover.
4.5.4 cuRRent status Of tHe fund
Thefundhasbeenveryactiveandisoftencitedasanexampleofawell-functioningFundintheemergingmarkets.BuildingonthesuccessrealisedinPhaseIoftheRCDFPolicy(2003-2009),PhaseIIoftheRCDFPolicy(2010-14)isnowunderwayandaimstoincreasethescopeofprojectsimplementedunderRCDFPolicyI:enhanceinternetconnectivityacrossthecountryandthedeliveryofcontentusingICTthroughoutthecountry.ThisincludesprogrammessuchasICTtrainingcentresandtheinternetcafesprogramme.
Theactualfund’sexpenditureonRCDFprojectsfortheperiod2002/3to2010/11hasbeenapproximatelyUS$40million(includingtheprovisionfor2010/2011).61Thisrepresentsapproximately85%ofthetotalFund’srevenue.Aspreviouslystated,theWorldBankfinancingcomprisesabout30%ofthetotalfinancing.
AccordingtothelatestRCDFreport,itsbudgetfor2014,includingrolloverfromthepreviousyearisUS$20million.Thisbudgetisintendedtoaddressthefollowing:
• 3DTTBregionalsites• IntegrationofICTinto30healthfacilities• IntegrationofICTinto120schools
expectedtoincludesomeprivateschools• CommunityICTtrainingin50schools
expectedtotrainabout15,000peopleacrossthecountry
• virtuallaboratorysciencecontentinstallationin250schools
• Providinginternetconnectivityincludingsatelliteconnectivitytoabout240projectsacrossthecountry
• ExtendingbothvoiceanddatanetworksinnorthernUgandaundertheERT/ICT,WorldBankfundedprogramme.
4.5.5 WHat tHe fund Has acHieved tO date
TheRCDFhasfinancedprojectstoprovidetelephony,Internetaccess,InternetPOPs,andInternetexchangepointsandcontentdevelopment.Fundshavebeenavailableforareaswhereserviceprovisionisnotfeasibleorunlikelytobeprovidedbytheoperatorsinthenextonetotwoyearswithoutasubsidy.Infact,154underservedsubcountiesofUgandahavebeenidentifiedanddividedintothreeuniversalaccessareas.Between2003and2009,thefocusofRCDFprojectswasonensuringaccesstoICTservicesfortheunderservedareas.Subsequently,theRCDFprojectfocusshiftedtoensuringusageofICTservices.
Approximately5,482projectshadbeenaccomplishedbytheendof2010/1162:
• 106Internetcafes• 175healthICTfacilities• 78ICTtrainingcentres• 76InternetPOPs• 13multi-purposecommunitytele-centres
(MCTs)• 45postaltele-centres• 708schoolICTlabs• 78webportals• 4,099publicpayphones• 90GSMsites• 6contentdevelopmentinitiatives• 2localgovernance(provisionofICTto
residentDistrictCommissionersandconstituencyMembersofParliament)
• 6uniqueprojects(establishmentofICTlabsinuniversitiesandtertiaryInstitutionsoflearninginUganda)
61. rCDF Annual report 2009/201062. rCDF Annual report 2009/2010
50
SSA USF STUDY
Intheeducationalsector,therewere823ICTlaboratoriescompleted,with76morelaboratoriesunderway;335internetconnectionscompleted,with488moreunderwayand665teachersre-trained,with135underwaybyMarch2011.ByMarch2012,therewere252completedsolarpoweredICTlaboratoriesforschoolsand195underinstallation;and252completedgridpoweredICTlaboratoriesand72underinstallation.
FundshavebeendistributedtoUTL,MTN,someInternetServiceProvidersandindependentcompaniesthroughcompetitivebidding.Forexamplebetween2003and2011,some174InternetconnectivityfacilitieshavebeenestablishedbyUCC/RCDFinpartnershipwithMTNthroughoutthecountry.MTNhadincreasedthevalue-addedservicesofsuchfacilitiesbyaddingmobile-money,dealershipandforeignexchangebureauservicestotheprovisionofInternetandICTtraining.63In2011,UCCcontributedUS$12,000towardstheestablishmentoftheMpondweICTTrainingCentreplusafacility,worthUS$24,000thataimstoextendtheuseofinternetservicesinruralUganda.MTNwonthebidtoestablishthesecafesthroughacompetitivebiddingprocess.Also,MTNhasledtheMTNvillagePhoneproject,builtonthefoundationofmicrocreditandsynergiesofdifferentpartnersincludingtheGrameenFoundation,MFIsandvillagePhoneOperators.9,000ofthemwereinstalledbetween2003and2007,whichwas3,000abovetheplanandthesearenowfullyprofitableandself-sustainingbusinesses.
Overall,theRCDFhascontributedtobringingcommunicationsfacilitiesandserviceswithinthereachofthelocalcommunitiesbyenlistingprivatesectorplayerstoinvestintheunderservedareas.SomeofthelocalpopulationhasbeenabletoreceiveICTtraining,leadingtobothdirectandindirectemploymentopportunitiesforthelocalpopulation.
AccordingtotheRCDFAnnualReport2012/2013,thefollowingprojectswerecompleted:
• 2DigitalTerrestrialTransmissionBroadcasting(DTTB)regionalsitesdeveloped
• 32newdistrictwebportalswithregionaltranslations
• Over200ICTlaboratoriesestablishedinschoolsincluding6Universities,7healthcolleges,5collegesofcommerceand159governmentsecondaryschools
• CommunityICTtrainingin62schoolsforover13,000peopleacrossthecountry
• Telemedicineinstallationsin53hospitalswereactivated
• virtuallaboratorysciencecontentwasinstalledin106schoolstakingthetotalnumberofschoolICTlaboratoriesupto300
• Internetconnectivityincludingsatelliteconnectivitywasprovidedtoover300projectsacrossthecountry
Nonetheless,theFundhasbeenfacingnumerouschallenges:
• verylowincomesofthemajorityoftheruralpopulation
• Lackoforinsufficientpowersupplies
• IlliteracyandignoranceofthebenefitspresentedbyICTs
• highconnectivitycostsandlackoflocalcontentfortheInternet
63. rCDF Statement 2011
51
SSA USF STUDY
64. UCC Annual report 2009/2010 and rCDF Annual report 2012/2013
Theimpactofthefund’sprojectsisregularlyevaluatedandattemptshavebeenmadetoaddressthesechallengesbyusinglowenergy(solar-powered)computers,sharingtechnologiesorRCDF-supportedInternetPointsofPresence.RCDFhasalsobeenrecognisedamongallotherUSFsintheworldforbeingtheonlyUSFthathasbeenabletoabsorballfundsatitsdisposal(forseveralyearsrunning)andtoattractthebiggestamountofdevelopmentpartnerfunds(US$15million).64
4.5.6 OtHeR eleMents Of inteRest
Althoughhighlysuccessfulincollectionanddisbursementwithitsleastcostsubsidyauctionstrategystimulatingextensivenationalnetworkrollout,thereisalackofevidenceofasystematicimpactofitsactivities,asruralpenetrationremainsverylowandmostpeopleinruralareasstilldonothaveaccesstobasiccommunications.Also,despitetheintroductionofcompetitionthroughtheunifiedlicensingregime,theUgandantelecommunicationsmarketremainshighlyconcentratedwithMTNUgandahavingover60%ofthemobilevoicemarketshareandTelekomUgandaLimitedthemajorityofthefixedvoicemarkettherebyleavingthesetwooperatorsastheonlymaincontendersintheuniversalserviceprojectbids.
InitseffortstoprovideMemberStateswithguidelinesforthesuccessfulimplementationofuniversalaccess/servicepolicies,theEconomicCommunityforWestAfricanStates(ECOWAS)adoptedtheSupplementaryActonUniversalAccess/Servicein2007.The15ECOWASmemberstatesare:Benin,BurkinaFaso,Capeverde,Gambia,Ghana,Guinea,GuineaBissau,IvoryCoast,Liberia,Mali,Niger,Nigeria,Senegal,SierraLeoneandTogo.TheActprovidesguidelinesonthefollowing:
• Creationofanappropriateregulatoryandpolicyenvironmentthatfostersuniversalaccess/service.
• Measuresthatcanbetakentodevelopanationalpolicywithrealisticuniversalaccess/serviceobjectives.
• Roletobeplayedbynationalregulators,policymakersandoperators.
• Telecommunicationsservicestobeincludedinuniversalserviceobligations.
• Fundingmechanisms.• Co-operationintheareaofuniversal
access/service.
4.6.1 univeRsal seRvice/ access leGal fRaMeWORk and scOPe
TheECOWASSupplementaryActA/SA.6/01/07onUniversalAccess/Service(“TheAct”)wasadoptedbyECOWASheadsofStateinJanuary,2007.TheActdefinesuniversalserviceasallcitizenswithintheterritoryoftheECOWASMemberStateshavingaccesstoabasicgroupofservicesataffordablerates,regardlessoftheirgeographiclocation.65
TheActcallsuponMemberStatestotakeallnecessarymeasuresinorderto:
• Formulateanationalpolicythatidentifiesappropriateandrealisticuniversalaccess/serviceobjectivesandconsidersthedifferencesbetweenuniversalaccess
(publicaccesstoICTs)anduniversalservice(privateorhouseholdaccesstoICTs);
• Asfrequentlyaspossible,conductpublicconsultationswithstakeholderstoidentifytheirneedsandmodifyuniversalaccess/servicepolicies,regulationsandpracticesaccordingly;
• Designuniversalaccess/servicepolicies,regulationsandpracticestocreateincentivesfortheprivatesectortoextenduniversalaccesstocommunicationsservices;
• Useamulti-prongedapproachtoaddressinguniversalaccess/servicechallengesandopportunities,relyingoncomplementarystrategiestomeetthetargetsthathavebeenset;and
• EstablishafairandtransparenttelecommunicationsregulatoryframeworkthatpromotesuniversalaccesstoICTs,whileallowingthemarkettoaddressuniversalaccess/servicetothegreatestextentpossible,interveningonlywherethemarkethasfailedorseemslikelytodoso.
Creatingtheappropriateregulatoryframeworkentails:
• Promotingtechnology-neutrallicensingpracticesthatenableserviceproviderstousethemostcost-effectivetechnologyinprovidingservicesforendusers;
• Adoptingatransparentandnon-discriminatoryinterconnectionframeworkinwhichinterconnectionratesarelinkedtocosts;
• Reducingregulatoryburdenstolowerthecostsofprovidingservicestoendusers;and
• PromotingcompetitionintheprovisionofafullrangeofICTservicestoincreaseaccess,affordability,availabilityanduseofICTs.66
4.6
ecOWas
65. eCOWAS Supplementary Act A/SA.6/01/07 on Universal Access/Service at Art. 1 (2)66. eCOWAS Supplementary Act A/SA.6/01/07 on Universal Access/Service at Art. 1 (2)
SSA USF STUDY
52
53
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Inaddition,theActdeterminesthatwhereitisnecessaryforregulatorsandpolicymakerstointervenetofacilitatethedeliveryofuniversalaccess/service,thefollowingshouldbeaddressed:
• Publicaccessstrategiesshouldbeexploredinadditiontoprivateuniversalservicestrategies.
• Bothpayandplaystrategiesshouldbeemployed,butwherepossible,operatorsshouldbeencouragedtoinvestinrural,remoteandlow-incomepopulationsandareas.
• Countriesmayuseregulatoryreformasthefirststepinachievinguniversalaccess,recognisingthatfurtherstepsmaybenecessarytoachieveubiquitousaccesstoICTs,e.g.,inruralareasorforuserswithspecialneeds.
• Appropriatelicensingschemesforruralserviceproviderscouldbesetuptomeettheneedsofunservedandunderservedareas.
Furthermore,theActestablishesthatnationalregulatoryauthoritiesmustensurethatuniversalserviceisprovidedtoeveryoneataffordablerates.Theymay,attherequestoftheministerinchargeofthesector,requiredesignatedcompaniestomakeavailabletolow-incomeorspecial-needsusersprices,optionsorschemesthatdifferfromthosenormallyprevailinginacommercialoperation,particularlywithaviewtoensuringuniversalservice.Theconditionsunderwhichsuchfacilitiesaregrantedmustbeproportional,transparent,non-discriminatoryandpubliclypromulgated.67
AccordingtotheAct,MemberStatesshouldalsoaimtoestablishinnovativeregulatorypoliciestopromoteuniversalservice,including:
• Promotingaccesstolow-costbroadbandinterconnectivityfromthelocalleveltotheinternationallevel,involving
governmentauthorities,companiesandnon-governmentalorganisations;
• Adoptingregulatoryframeworksthatsupportapplicationssuchase-educationande-government;
• Adoptingpoliciesaimedatincreasingaccesstotheinternetandbroadbandservices,basedontheirownmarketstructure,suchthatthepoliciesreflectdiversityinculture,languageandsocialinterests;
• Ensuringthatnationalregulatoryauthoritiesworkwithstakeholderstoexpandbroadbandcoverageandusethroughmulti-stakeholderpartnerships,inconjunctionwithgovernmentinitiativesthatpromotefinanciallysustainableprogrammes,particularlywithaviewtobridgingthemarketgapthatmayexistinsomecountries;
• Adoptingregulatoryregimesthatfacilitatetheuseofalltransportmedia,whetherwireline,powerline,cable,wirelessoranyothernewtechnology;
• EnsuringthatnationalregulatoryauthoritiesputforwardinitiativesforencouragingpublicaccesstobroadbandandInternetservicesinschools,librariesandothercommunitycentres;and
• EnsuringthatnationalregulatoryauthoritiesimplementharmonisedspectrumallocationsconsistentwiththeITUradiocommunicationconferenceprocessandeachcountry’snationalinterest.68
TheActalsoprovidesthatcooperationintheareaofuniversalservice/accessmustbeexploredonseverallevels:
• Betweentheprivatesectorandcommunities,sothatwherepossiblethemarketcandeliveruniversalaccess/service;
67. Id.
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SSA USF STUDY
• Betweencommunities,governmentandtheprivatesector,toensurethattheaccessgapisdealtwithinamannerthatisrelevanttocommunities;and
• Withingovernment,wherethefullbenefitsofICTsmaybereapedwhenitextendsbeyondinfrastructureandtechnology,toincludeICTaccessinhealth,education,agricultureandothersectors.69
Intermsofenforcement,theActprovidesthatMemberStatesshallensurethatthecompaniesentrustedwiththetaskofprovidinguserswithservicesundertheuniversalserviceregimeprovidethenationalregulatoryauthoritywitharegularaccountoftheiractivitiesandresultsachieved.Nationalregulatoryauthoritiesshallalsoestablishperformanceobjectivesforcompaniesassuminguniversalserviceobligations.70
PursuanttotheECOWASSupplementaryAct,individuallicencesmayspecifyresultstobeachievedfortheprovisionofuniversalaccess/service.71Alicensee’spersistentfailuretoachievethespecifiedperformanceobjectivesandqualitylevelsmayentailtheapplicationofsanctionsbythenationalregulatoryauthority.Nationalregulatoryauthoritiesarealsoentitledtorequireindependentverificationofanoperator’sperformanceoftheobligationsimposedonit.72
Mandatoryservicesincludedirectoryandinformationservices,emergencyservices,publicpayphonesandservicestopeoplewithdisabilitiesorspecialneeds.however,theActstatesthatwithintheirrespectivenationalterritories,MemberStatesmaydecidetomakeadditionalservicesaccessibletothepublicbeyondthoseservicesalreadydefinedintheActasuniversalserviceobligations.73Intermsofemergencyservices,theActprovidesthatMemberStatesshallensurethatemergencycallscanbemade
freeofchargefromanyfixedormobiletelephone,includingtelephonebooths.74
TheActalsostatesthatinordertoenablethosewhodonotsubscribetoatelephoneservicetohaveaccesstotelephoneservices,MemberStatesmustensurethatpublicpayphonesareinstalled,underreasonableconditions,intermsofquantityandgeographicdistribution.Withoutprejudicetomoregenerousdomesticlegislationthatmayexist,MemberStateswererequiredtoensurethatnationalregulatoryauthoritiesareinapositiontoimposeschedulesforthedeploymentofpublicpayphones,withtheaimofhavingatleastonepublicpayphoneineachlocalitynumbering500inhabitantsormoreby31December2010.ECOWASwillmonitortheimplementationofthismeasureonanannualbasis.75
Inaddition,theActprovidesthatwheretheneedexists,MemberStatesshalltakespecificmeasurestoensurethatuserswithdisabilitiesorspecialsocialneedshaveequivalentandaffordableaccesstopubliclyavailabletelephoneservices,includingemergencyanddirectoryservicesatanaffordableprice.76
TheActmandatesthatinmonitoringandreviewingpolicies,MemberStatesmust,ononehand,adoptmeasurabletargetsforimprovingconnectivityandaccesstoICTuse,whichcanbebasedondistance,populationdensityorlengthoftimeneededtohaveaccesstoICTs.Ontheotherhand,MemberStatesmustholdperiodicreviewsofuniversalaccess/servicepolicies,regulationsandpracticesinordertoadapttotheevolvingnatureofICTservicesandend-userneeds.MemberStatesarerequiredtoreviewperiodicallythescopeoftheuniversalservice,focusingonproposalsforitsmodificationorredefinition.ThefirstsuchreviewistobeheldnolaterthantwoyearsfollowingthedateoftheAct’sentry
68. eCOWAS Supplementary Act A/SA.6/01/07 on Universal Access/Service at Art. 1 (2)69. Id.70. Id.71. eCOWAS Supplementary Act A/SA.3/01/07 on the Legal regime Applicable to Network Operators and Service providers72. eCOWAS Supplementary Act A/SA.6/01/07 on Universal Access/Service at Art. 17(3)73. Id.74 Id.75. eCOWAS Supplementary Act A/SA.6/01/07 on Universal Access/Service at Art. 11.76. Id.
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SSA USF STUDY
77. eCOWAS Supplementary Act A/SA.6/01/07 on Universal Access/Service at Art. 13. 78. Id. at Art. 20.
intoforce,andthereafterareviewshallbeheldeverythreeyears.Thereviewshallconsidersocial,economicandtechnologicaldevelopments,andshallhaveparticularregardtodatamobilityandtransferratesforthetechnologiesmostwidelyusedbythemajorityofsubscribers.MemberStatesarerequiredtoinformtheExecutiveSecretariatofECOWASofanychanges.77
4.6.2 fundinG MecHanisM
Toassistnationalregulatoryauthoritiesindeterminingwhetherprovisionofuniversalserviceplacesanunjustifiedburdenonthecompaniesdesignatedasproviders,theActestablishesthatMemberStatesshallcommittoprovidefortheadoptionofamethodforcalculatingthecostsoftheuniversalservice,basedonnetcosts.Thenetcostcorrespondstothedifferencebetweentheinvestmentandoperationalcostsassociatedwithprovisionoftheuniversalserviceandtherelevantrevenues.Relevantrevenuesarethedirectandindirectrevenuesgeneratedbytheuniversalservice.Thenetcostofanyspecialprice-schemeoffersmadebyanoperatortocertaincategoriesofsubscriberstoensuretheiraccesstotheuniversalservicearetobedeductedfromthatoperator’scontributiontotheUSF.ThecalculationofthenetcostoftheuniversalserviceobligationsmustbesubmittedforauditingbyanentitythatisnotconnectedwiththebodyresponsibleformanagingtheFund.Theresultofthenetcostcalculationandtheauditconclusionsaretobemadepubliclyavailable.
Fundingandsubsidiesmustbetargeted,andthesearetobedeterminedanddeliveredinamannerthatistransparent,non-discriminatory,inexpensiveandcompetitivelyneutral.Subsidiescanbeprovidedusingseveralmeans,including:
• AUniversalServiceFund,whichshouldbedevelopedasamechanismwithinabroadermarketorientedapproachtoachievinguniversalaccess;and
• USFmaybefinancedbyabroadrangeofmarketplayers,managedbyneutralbodiessuchasregulatorsandmayalsobeusedtokick-startpublicaccessprojectsthatmeettheneedsofthelocalcommunity.
Governmentsmayalsoconsiderafullrangeofotherfinancingmechanisms.CompetitiveminimumsubsidyauctionsareoneoptionthatmaybeusedtoreducetheamountoffinancingnecessaryforpublicaccessprojectsfinancedbyaUniversalServiceFund.Publicaccessprojectscanbedesignedtoachievelong-termfinancialself-sustainability,especiallywhereconsiderationisgiventoinnovativelow-costtechnologies.78
4.6.3 WHat Has tHe ecOWas act acHieved sO faR
DespitethemanysolidguidelinesforeffectivecreationandmanagementofUSFs/UASFsthatarecontainedwithintheAct,thereislittleevidencethattheMemberStateshavemadeanynoticeableprogressinadoptingandcarryingouttheseguidelines.
Best practices in the management of the UsF
AttheoutsetoftheintroductionofUSFs,governmentsandtelecomorganisationsalikeviewedUSFsasanewandinnovativeapproachtoaddressinguniversalservicerequirements,especiallyinlightofvariousconcernsregardingthepracticalityofUSOframeworksinanincreasinglyliberalisedglobaltelecommunicationsenvironment.TheICTRegulationToolkit,thefollowingdescriptionwasappliedtotheUSFconcept:“Where UAS Funds are used, they have proved effective when disbursement is coupled with competitive bidding or auctions for these financial incentives, requiring operators to compete for the minimum subsidies needed to fulfill the UAS target.”79
however,USFshavenotproventobetheexpectedpanaceatouniversalservicefundingand,unfortunately,thereareextremelylimitedexamplesofbestpracticeswithrespecttoUSFmanagement,particularlyinSSA,andeventhosethatcanbecitedasbeingbestpracticeexampleshavetheirindividualdrawbacksandshortcomings.BasedontheanalysisconductedaspartofthisSSAUSFstudy,theauthorshaveconcludedthatalthoughtherearesomeexamplesofwell-conceivedandwellimplementedFunds,itisextremelydifficulttopointtomanyFundsthatembodyallofthepositiveelementsthatwouldcontributetoahighlysuccessfulandeffectiveFund,creatingasustainableeconomicvalueintermsofeconomicdevelopment.
05.
5.1
intROductiOn
79. http://www.ictregulationtoolkit.org/en/Section.3116.html
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ThissectionexplorestheelementsneededtoensureasuccessfulUSFfund.These12essentialelementsforthesuccessfuldesignandadministrationofafundare:
1. Asoundandflexiblelegalandregulatoryframework
2. Afundmustbeautonomousandindependentinnature
3. Clearpolicyarticulation4. Consultationwithstakeholders5. Cleardelineationofresponsibilities
betweenUSFsandotherexternalorganisations
6. Definedandmeasurableobjectives7. Flexibilityandneutralityinservice
development8. Fairandobjectiveprojectallocation
process9. Capacitybuildingandsustainability10. Innovationandincentives11. visibility,transparencyand
accountability12. Digitalinclusion
Eachelementisexploredinmoredetailbelow.Whereverpossible,SSAexampleshavebeenutilised.Whensuchexamplesarenotavailable,referencesaremadetosuccessfulexamplesinotherregions.
5.2.1 sOund and flexible leGal and ReGulatORy fRaMeWORk
OneofthefundamentalsuccessfactorsnecessarytoprovideasolidanddevelopmentallyorientedfoundationforUSFsisalegalorregulatoryframeworkthatisflexibleenoughsoasnottoimpedeevolutionandchangeasneedediscriticaltothesuccessfulongoingfunctioningofaUSF.Therearesomecountriesthathavebeenabletochangethescopeand/ordirectionoftheUSFbecauseofthisunderlyingflexibility.
InGhana,thelegislativeflexibilityallowedGIFECtobroadenitsmandatetoincludetheprovisionofaccesstoelectronicservicesincludingICT,broadcasting,internetandmultimediaservice.AnotherexampleisNigeriawhere,basedonanassessmentofthefundperformance,theadministratorsareintheprocessoftransitioningandenhancingmanyaspectsofthefundbecausetheunderlyingframeworkenablesthemtomakechanges.
5.2.2 autOnOMy and indePendence
Withintheportfoliooffundsexamined,therearesomefundsthathavebeenstructuredtooperateinafullyautonomousmanner.Anexampleofhowthisfunctionsisasfollows.Innigeria,thefundisaseparateentity–theUSPF;theBoardofDirectorsisformedwithrepresentativesofboththeprivateandpublicsectors.ThisautonomyhasallowedtheBoardtoundertakeanin-depthexaminationofsomeperformanceissuesandtoaddressthisthrougharevamping/re-orientationofthefund
5.2.3 POlicy aRticulatiOn
AlthoughthetelecommunicationsorICTlawprovidesdirectionforthecreationofaUSF,thisisgenerallyatahighlevel.ThishighleveldirectiveneedstobecomplementedandsupportedbyacleararticulationoftheoverallUSFvisionandpolicyinadditiontotheactivitiesneededtocarryoutthepolicy.Inordertodoso,someofthefundamentalquestionstobekeptinmindare:Whatisthefundseekingtoaccomplishandhowshoulditsresourcesbeallocatedtoachievetheseobjectives?Thispolicyarticulationisoneofthefundamentalelementsofasuccessful
5.2
basic eleMents and cHaRacteRistics Of a successful usf
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USF,someexamplesofwhichareasfollows.TheregulatorinBurkinaFasoregularlypublishesUSFstrategiesandgoalsthatincludenationalcoveragegoals.80InUganda,theUSFpolicyclearlydefinesthephasesoftheUSF,theobjectivesandhowtheseobjectivesshouldbeattained.
5.2.4 cOnsultatiOn WitH stakeHOldeRs
Theconceptofstakeholderconsultationisrecognisedasextremelyvaluableinthatitisoftentheoperatorsandothertelecomplayersthathavein-depthknowledgeand,assuch,areabletooffervaluablesuggestionsandguidanceasregardsfundfocusandexecution.ThisalsofostersthenotionthattheUSFmanagementistransparentwithwellentrenchedconsultativeprocesses.InthecaseofGhana,theBoardofTrusteesforthefundincludesarepresentativefromeachmajortelecomoperator.
InMorocco,operatorshaveanumberofoptionsregardingthemannerinwhichtheycanfulfiltheirUSFobligations.Theseinclude:
• Takethe‘traditional’USFrouteandpay2%ofgrossrevenuesperannum.
• RespondtotendersissuedbytheUniversalTelecommunicationsServicesManagementCommittee(CGUST).
• DevelopandproposetheirownUniversalServiceprojects.
AlloperatorsarefreetorespondtotendersissuedbytheCGSUTandtoparticipateinacompetitivebiddingprocess.AnyoperatorthatwouldliketodevelopandexecuteitsownuniversalserviceprojectsmaysubmitaproposaltotheCGSUTforreviewandapprovalatwhichtimetheCGUSTwill:
• Dictatethetermsandconditions;and• Prepareatermsheetintheformof
anauthorisationorlicence(cahierdescharges).
Forthoseoperatorsthatelecttoparticipateinthe‘play’approach,attheendofeachfinancialyear,theoperatorspaythedifference(ifany)betweenthefullUSFamountthatwouldhavebeencollectedfromthem(i.e.,thetwopercentlevy)versustheamountexpendedbytheminfulfillingtheUSFprojects.Althoughthisapproachmaynotbeperfect,thePayorPlayconceptdoesachieveseveraldesirablegoals:
• Operatorshavetheopportunitytoactivelyparticipateinthedesignofuniversalserviceprojects.
• Thereisanopportunitytoactuallyseetheprojectstowhichthefundsarebeingdirected.
• Thereistheabilitytoreducealevythatindirectlygetsallocatedtootheroperatorsandtomakesurethattheoperatorthatcontributesisabletobenefitdirectlyfromthatcontribution.
5.2.5 delineatiOn Of ResPOnsibilities betWeen tHe usf and OtHeR exteRnal ORGanisatiOns
Clarityisimportantinanyundertaking,especiallywhenattemptingtorespondtotheoftenurgentrequirementsofaUSFprojectcandidate.Therefore,guidelinesandproceduresforworkingwithothergovernmententitiesorfundingsourcesassistintheadministrativeeffectivenessofthefund.InSouthAfrica,adetailedUSFoperatingmanualhasjustveryrecentlybeenpreparedwherebyitdefinesandallocatesrolesandresponsibilities,includingwithotherorganisationssuchastheSouthAfricaBroadbandForum.
5.2.6 defined and MeasuRable Objectives
TheUSFpolicyarticulationreferencedaboveinsection5.2.3abovemustbebolsteredbythedevelopmentofdefined
80. It is important to note that although the strategy publication is commendable, there is no evidence to date that any of the recommendations have ever been implemented.
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andmeasurableobjectives.Withoutclearlydefinedobjectives,itisextremelydifficult,ifnotunachievable,toascertaintheextenttowhichthefundhasbeeneffectiveincarryingouttheoverallpolicyandvisionasregardsthefundingofuniversalservicerequirements.Thisinstilsgreaterconfidenceinthestakeholdersandencouragesoverallsupportoftheprogramme.SpecificexamplesofthiswerenotevidentinSSAwheredefinedobjectivesaretypicallyconfinedtoalistingofprojectstobeundertaken;thereforethefollowingexamplesarecited:
• colombia:Thefundproducesafouryearplanwithtargets,detailedprojectdescriptionsandtheprojectedassociatedcostoftheprojects.
• Peru:FITELproducesanannualreportonfundperformancewithrespecttoprojectallocationandprojectperformanceversustarget;thisreportalsoliststheprojectsandrelatedtargetstobeaddressedinthesubsequentfiscalyear.
5.2.7 flexibility and neutRality in seRvice dePlOyMent
Oneofthekeysuccessfactorsthatcannotbeoverlookedistheunderlyingneedforatechnologyneutralapproachinservicedeployment.Today,technologyandservicesevolveatsucharapidpacethatnoentitycanbeexpectedtoaccuratelypredicthowthemannerinwhichtechnologywillevolveandatwhatpace.Therefore,theguidingphilosophyshouldbethatanytechnologycanbeutilisedanddeployedprovidedthatitcorrespondstoaninternationalrecognisedstandardandcansatisfytheserviceand/orcoveragerequirements.Theflexibilityofatechnologyneutralapproachhasbeenparticularlyinstrumentalinthedeploymentofbroadbandgiventhehugeandburgeoningglobaldemandforthisservice.
5.2.8 faiR and Objective PROject allOcatiOn PROcess
AnequitableprojectallocationprocessneedstobeprecededbyanequitablefundcontributionprocesswiththeunderstandingthatthosewhocontributetoaUSFcanalso,wherefeasible,havethepotentialtobidand/orapplyforprojectsthatwillbefinancedviatheUSFmechanism.Thefundadministrationmustestablishclearandunderstandablecriteriaforproposedprojectsandforevaluatingprojectproposals.Thisshouldbefollowedbyaformalproposalsolicitationandevaluationprocesstoapproveselectedbidsandtodistributefunds.InordertoensurethegreatestpossibleparticipationinaUSFprojectallocationprocess,projectandbidannouncementsneedtobewidelydisseminatedsoastoencouragethemaximumnumberofinterestedparticipants.Oneofthemostsuccessfulapproacheshasbeentheuseofawell-publicised,competitiveandtransparentbiddingprocesssuchasthatusedinNigeria(leastcostsubsidywithsuccessfulbidderspostedonthefund’swebsite).
5.2.9 caPacity buildinG and sustainability
Inadditiontoprovidingbasictelecommunicationsinfrastructureandservices,fundsmusttakeintoaccounttheneedforsustainabilityasdemonstratedbelow.Sustainabilityisunderpinnedbytargetedandcomprehensivetrainingandothereducationalprogrammesdesignedtoensureself-sufficiencyinareassuchastheoperationoftele-centresorcommunitycentresand,inaddition,tofacilitatetheuseoftelecommunicationstechnologiesbypopulationsegmentswhohavepreviouslyhadlittleornoaccesstotelecommunicationsofanykind.Theconceptofsustainabilityshouldalsoencompassthedevelopmentofcontentand/orapplicationsthathavethepotentialtoassistthoserequiringaccesstospecialisedtelecommunicationsservices–
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servicesthataredesignedtoimproveandenrichthelivesofthosewhorequirethem.InLesotho,forinstance,contentdevelopersareeligibleforfundingviatheUSFwhereasinUganda,thefundpermitstheadditionofsupplementaryservicestostimulateuseoftele-centresandvillagephones,content,etc.
5.2.10 innOvatiOn and incentives
Inordertoencourageeffectiveprojectexecution,somefundsprovideincentivesforefficientdeploymentand/orinnovationandcost-minimisationwherefeasibleinsteadofdirectandimmediatereimbursement.Thisalsorequireseffectivefundadministrationandprojectoversighttoensurethattheincentivesarewarranted.The‘payorplayconcept’inMoroccoasdiscussedinsection5.2.4above,isoneofthefewexamplesofspecificattemptstomotivateoperatorsprovidingaUSFservicetoidentify,helpplanandultimatelydeliverthefacilitiesand/orservice.
5.2.11 visibility, tRansPaRency and accOuntability
GiventhesignificantamountofthecontributionscollectedfrommostoperatorsandconsideringthattheunderlyingregulationsgoverningindividualUSFsfrequentlyrequireregularreportingoffinancialresults,visibilityandtransparencyareparamount.ExamplesinSSAarelimitedbutthenewlyrevampedUSAASAinSouthAfricaistryingtoadoptthispracticeasexemplifiedbytheprojectbudgetsnowbeingpostedonitswebsite(pleaserefertoexamplesinsection4.–DeepDiveAnalysis).
5.2.12 diGital inclusiOn
Anumberoffundshaveattemptedtoaddressthespecialcircumstancesorrequirementsoftargetpopulationsectorssuchasthepersonswithdisabilities,theelderly,indigenouspeopleandwomenandgirlswhereasothersalsoattempttoaddresstheconnectivityneedsofanchorinstitutions.Althoughtherearequiteafewexamplesofanchorinstitutionconnectivity,therearefewerexamplesofsuccessfactorsinfundsthathavetranslatedpolicyintoactionasregardsinclusionofpersonswithdisabilities.TheexamplesofsuccessfactorsasregardsdigitalinclusionofgirlsandwomenareforthetimebeingextremelylimitedgloballyandevenmoresoinSSA.however,ofnoteisGhanawhereGIFECisestablishinghybridfor-profittele-centreandnon-profitcommunityresourcecentrestargetingthegeneralcommunitymembers,schoolchildren,youthoutofschool,womenandwomen’sgroups.Therearealso‘EasyBusinessCentres’forPersonswithDisability.AnotherexampleisinMauritaniawherethefundintroducedanInformationandTelecommunicationsCentreforpeoplewithdisabilitiesinwhichtrainingandservicesarealsotobeprovided.
Common challenges in the administration of UsFs in ssA
ItshouldcomeaslittlesurprisethatthereareavarietyofchallengesassociatedwithadministeringUSFsinSSA.Somemaybedirectlyattributabletotheflawsorshortcomingsintheunderlyinglegalandregulatoryframeworkbutothersmaysimplybeareflectionoftheconditionsprevalentinthecountryinwhichthefundisoperatingorthechallengescouldalsobetheresultofthefundamentaleconomicunviabilityofthefunddesign.Alistofsomeofthemostcommonlyencounteredchallengesandpitfallsareprovidedinthesubsequentsection.
Theunderlyinglegalframeworksformanyfundsseemtohavenotbeenwellthoughtoutorconceivedfromtheoutset(e.g.,nottechnologyneutralorserviceflexible,excessivelybureaucratic,insufficientoversight,etc.)andthishasresultedinanumberofineffectiveorseverelyconstrainedfunds.Inanumberofcases,forinstance,theframeworkisdesignedtosupportfundingonlyoffixed-lineservices.however,insomecases,thiscanbeattributedtothefactthatatthetimeatwhichsomeoftheUSFswerecreated,manydidnotanticipatetheexplosivedevelopmentofmobiletechnology,norindeedothertechnologies.Thesesameissueswithrespecttounderlyinglegalframeworksalsoposeamajorchallengetotheintroductionofruralandnon-commerciallyviablebroadbandthroughtheUSFfundingmechanismbecausemanyoftheframeworksrequirelegalorregulatorychangesinmanycasesinordertoincludetheprovisionofbroadband.
Basedontheageofmanyfunds,somewhatunderstandably,verylittleornoconsiderationwasgivenatthetimeoftheirinceptiontothepossibilityofancillaryandcomplementaryservicesortoolsthatmightneedtobeprovidedinconjunctionwithorinadditiontotheUSFfundedproject(e.g.,improvedpowersources,theneedforaccessroads,requirementfortraining,equipmentneededtocomplementbasictelephonyintele-centres,theneedtodevelopspecificcontentandapplications,etc.).
06.
6.1
OveRvieW
6.2
undeRlyinG leGal and ReGulatORy fRaMeWORk
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Inanumberofcases,thelaworregulationisverygeneralinnatureandrequirestheissuanceofasupportingdecreeorregulationinorderforthefundtobecomefullydefinedandoperational.Forreasonsthatseemquiteunclearinthemajorityofcountrieswheresuchasituationexists,therewouldappeartobelittleornosubsequentefforttoprepareorissuetherequireddecree,rulesorinstructionsthatwillgoverntheoperationofthefund.Thishasresultedinanumberoffundswherethelevyisestablishedandcollectedbutnorelatedfundactivityisinitiated,therebyresultingincollectedmoniespresumablyremainingdormantandnotbeingputtotheuseforwhichtheywereintended.
Asaresultofeithertheabove-referencedrestrictionsoroversightsinthelegalandregulatoryframeworkorduetoagenerallackofabilityorsometimesthewillonthepartofregulatorsandfundadministrators,manySSAfundsintheircurrentstatecannotbeadaptedtonewconditionsandrequirementsorcannotevolveinaccordancewithtechnologicalorsocietalchange.Therefore,suchfundsarelessflexiblethanneededandtheseconstraintscanstiflethelevelofresponsivenessandusefulnessofthefundasregardstheneedsoftheunservedand/orunderserved.Ithasbeenclearforanumberofyearsthatmanyfundsintheircurrentstate,basedonthedefinitionoftheoverallobjectivesandthestipulatedfocusareas,havebecomelesseffectivethanwouldbedesiredandwouldrequirestructuralchange.however,todate,onlyalimitednumberofcountriesfacedwiththeseconstraintshaveattempted,whetherthroughlegislative,regulatoryorpolicychanges,torevamporre-orientthefundmission,structureandadministration.Itisanticipatedthatthiscouldbeaproblemgoingforwardevenforsomeofthefundsthathaveamorefuture-orientedframeworkandpolicygiventhatoutlooksandwhatisviewedasforwardthinkingatonestagecanbecomerapidlyoutdatedinthefaceofrapidsocietalchangeandtechnologicalevolution.81
Ingeneral,evenforthemosteffectivefunds,theleviesandtaxesestablishedformostUSFcontributionsappeartohavebeenestablishedwithoutconductingsubstantiveanalysisregardingtheactualservicefunding/subsidylevelsneededand,asaresult,manyfundsreceivecontributionsthatappeartobefarinexcessoftheactualuniversalservicefundingneedsorcapabilities(pleaserefertosection3.2.4above),withnoconcreteplansregardinghowtoaddressthis‘overfunding”.Inothercases,thefundsseemtohavedifficultiesindevelopingenoughprojectstoutiliseadequatelytheleviescollected.Inmanyinstances,thisisduetotheabsenceofaccessgapevaluationsaswellasmeaningfuldemographicsurveys.Ineithercase,thiscanresultinsubstantial,undisbursedsurplusesinthefunds.
6.3
difficulty tO adaPt tO cHanGinG RequiReMents and fOcus
6.4
cORRelatiOn betWeen usf levies and deMand
81. For instance, in ItU trends in telecommunications 2003, considerable effort and emphasis were devoted to what constituted an ideal USF. However, the vision at the time did not take into account many factors that are considered very important in 2014 (e.g., e-applications, sustainability, etc.
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Manyfundsareconstrainedbecauseofbasicstructuraldeficienciesthatcanbemanifestedinmanydifferentforms.however,ingeneral,deficienciescouldincludeitemssuchasacleardefinitionofrolesandresponsibilitiesordetailedguidelinesregardingthemannerinwhichleviesshouldbecalculatedandsubsequentlyappliedandcollected.Otherexamplesmayincludetheweakorambiguousdefinitionsofwhatthefundscanaddress,resultinginconstrainedapproachestoprojectidentificationandallocation.Inthefundsinwhichsomedegreeofstructuraldeficienciesexists,someofthedifficultiesandchallengesbeingencounteredare:
ManyUSFsdonothaveacleararticulationofeitheroverallUSFstrategyorobjectives.Inadditiontocausingthedifficultiesmentionedwithrespecttooversightandgovernance,thelackofaclearstrategyhasresultedinanumberofissuesandobstacleswithanumberoffundssuchasaninabilitytoadequatelysettargetsoraninabilitytodemonstratewhatthefundhasachievedintermsofcoverageorinmeetingoverallobligationsofthefund(inmanycases,theseelementshaveneverbeenstatedinthefirstplace).
ManyfundshavebeenhamperedorevengreatlyimpactedbythechoiceofmanagementpersonnelwholacktherequisiteskillsandbackgroundrequiredfortheeffectiveadministrationofaUSFandthissituationresultsinineffectiveoveralladministration.ThereappearstobeseveralbasicreasonsforthissituationincludinginappropriatedefinitionofboththevariousUSFmanagementrolesandtheskillsetandexperienceneededtofulfiltheroles.Inadditiontotheseshortcomingsatthefundmanagementlevel,similarsituationsoccurattheprojectlevelwheretheprojectdescriptionanddefinitionsdonotnecessarilytakeintoaccountalloftheexperience,skilllevelsortimecommitmentsneededforsuccessfulprojectexecution.Furthermore,inanumberofcases,theresourceswithinthefundmanagementteamarenotinapositiontobeabletocloselymonitorand/oroverseesuccessfulprojectexecution.
6.5
stRuctuRal deficiencies
6.6
definitiOn Of usf stRateGy and Objectives
6.7
ManaGeRial, OPeRatiOnal and caPacity issues
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Thereisasignificantabsenceoffinancialreportingamongsttheexistingfunds.Ofthecountriesincludedinthisstudy,over75%havenoformalpublicreportingprocessinplaceregardingtheuseandmanagementoffundsormanyhavenotfollowedtheprescribedreportingprocesseventhoughinmanysuchcasestheydopublishsomeadhocprojectreports.Consequently,itisfrequentlydifficulttoascertainstatusofprojectsinprogressandinmanycases,thereareunclear,contradictoryornon-existentrelationshipspresentedbetweenfundscollected,fundsdisbursedandremainingbalance.Theperceivedtransparencyissueissevereenoughthattherehavebeenvariousallegations(andevencorroboration)offinancialmismanagementassociatedwithanumberoffunds.
Eveninfundswherethereisadegreeofautonomyandindependence,therearecaseswherepoliticalinterventionorinterferencefromothergovernmentagenciesaffectthefund’sperformance.Inothercases,thegovernanceprocessasestablishedhasneglectedtotakeintoaccounttheexternalfactorsthatimpedeoversightandgovernancesuchas,forinstance,delaysinbudgetapprovalswhenthesearerequiredfromParliamentortheNationalAssembly(orsimilar),orwheremultipleapprovalsarerequiredfromanumberofdifferentcommitteesandgovernmentorganisations.Incaseswherethegovernanceprinciplesandruleshavenotbeenadequatelyarticulated,legaldisputesormajordelayshavefrequentlyensued.
Theprojectallocationprocessisoneoftheotherareasinwhichfundperformancecanbesignificantlyaffected.Lackofqualifiedand/orinterestedvendorstobidonprojectsorflaweddesignofeconomicincentivesforvendorstobidareallelementsthatcanimpactUSFprojects.Overallshortcomingsoroversightsinthestructuring,allocation,administrationandmonitoringofprojectswillonlyresultininferiorprojectinceptionandimplementationor,insomecases,inunsuccessfulandabandonedprojects.Evenwhenmanyoftheactivefundsappeartohavetransparentprojectallocationprocesses,theballoftenstartstodropintermsofprojectmonitoring,trackingandreporting.
6.8
tRansPaRency, visibility and accOuntability in usf RePORtinG
6.9
OveRsiGHt and GOveRnance
6.10
PROject allOcatiOn PROcess
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AlthoughthischallengeisalreadyalludedtointheexaminationoftechnologyandservicelimitationsstemmingfrommisstepsintheformulationofUSFlegislationandregulation,theconstraintstobroadbanddeploymentrepresentoneofthemostsignificantdrawbackstomanyfundsinSSA.Withtheever-escalatingglobaldemandforrapidandeasyaccesstoinformationandthegrowingevidenceoftheeconomicandsocialbenefitsgeneratedbybroadbandimplementation,therestrictionsofmanyUSFsasregardsfinancingofbroadbandisamajorhurdle.TheBroadbandCommissionhascalledfortheincreaseduseofUSFstofundbroadbandbutthiscallfailstoconsiderthemanyconstraints.Therearemanyfundsthathaveadequatefinancialresourcestohelpfinancebroadbanddeploymentbutthefundssitidlebecausetheycannotbedisbursedforthispurpose.
ItisimportanttokeepinmindthattheoftenremoteanddifficulttoserveareasrequiringsupportfromUSFsarealsolackinginotherbasicnecessities;notjustadequatecommunications.Inmanycases,theUSFprogrammesfailtoconsidertheneedforpowersources,accesstowater,ongoingmaintenance,securityandothersustainabilityrequirements.Teleandcommunitycentresareoflimiteduseiftheycannotbeadequatelymaintainedwithreliablepowersourcesorifthereislackofpotablewaterorsanitation,tonamebutafewexamples.Thesehurdlesaresometimesencounteredbecausethefundmanagementhasnotcarriedoutanypre-projectsurveysandthustheseconditionsarenotconsideredintheoverallprojectdefinitionandstructure.
Inmanyinstances,theprogrammesandtargetsestablishedforthedeploymentoftele-centres,communityinformationcentresandcyberlabshavefailedtotakeintoaccountissuesrelatedtotrainingandeducationthatneedtobeaddressedduetowidespreadilliteracyandgenerallackofknowledgeamongstmanysegmentsofpooranddisadvantagedpopulations.Providingaccesstoadvancedinformationtechnologiesrequireswidespreadeducationandawarenessoftheiravailability,aswellasbuildingtheknowledgeandskillsnecessarytousetheserviceseffectively.TrainingandeducationrequirementsarenotconfinedtorecipientsoftheUSFprojects.ThesuccessfulexecutionofmanyUSFprojectsalsohasbeenhamperedbythelackofadequatelytrainedstafftomaintainservicessuchastele-centres.Thissamescarcityofresourcesappliestotheneedtohaveaccesstoindividualswiththerightskillsetandknowledgetoassistinandorcarryoutdevelopmentoftheapplicationsandcontentoftenneededtosupplement/reinforcetheservicestobeprovided.
6.11
cOnstRaints tO bROadband dePlOyMent
6.12
undeRlyinG infRastRuctuRe and facilities
6.13
availability Of ResOuRces and knOWledGe
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ThenatureoftheremoteandoftendifficultareastobecoveredbyUSFsmeansthattherearelocalsituationsthatimpedeortotallypreventUSFprojectsfrommovingforward.Theseincludefactorssuchashostileterrain,andprecariouspoliticalsituations(e.g.,politicalunrest,civilunrestorinsurgentactivity,etc.).Insuchsituations,thereislittletobedoneotherthanto‘waititout’untilthesituationbecomeslessproblematic.
TheoverallconceptofdigitalinclusionhasbeenoverlookedbythemajorityofSSAfundsincludedinthisstudy.Onceagain,inmanycases,therootofthisexclusionstemsfromanoversightorexclusioninthecraftingoftheinitialUSFlegalandlegislativeframeworkandthus,digitalinclusioncannotbeaddressedwithoutchangestothisunderlyinglegislationand/orframework.however,thisisnotalwaysthecase,anditisalsoimportanttonotethatwhileanumberoffundshavearticulatedapolicywithrespecttospecificelementsofdigitalinclusionsuchasservicesforpersonswithdisabilities,manyofthesesamefundshavesofarnottranslatedthearticulatedpolicyintospecifictargetsandactions.AlthoughmanyoftheSSAfundsintheorynowsupportthecreationoftele-centres,eitherthepolicyorthedefinedtargetsfortele-centreshavenottakenintoaccounttheaccessibility,assistanceforpersonswithdisabilitiestheneedtotargetandsupportservicesforgirlsandwomen.
6.14
lOcal cOnditiOns and Related secuRity
6.15
cOnsideRatiOn Of diGital inclusiOn
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RecommendationsAsdemonstratedintheprecedinganalysesandasfurtherreinforcedinsection8below,thecurrentperformanceofmostUSFsinSSAfallsfarshortofachievingtheuniversalservicegoalsthatweretheinitialcatalystsfortheformationoftheseUSFs.Withonlyafewnoteworthyexceptions,governmentsandadministrationsinSSAhavesofarbeenunabletoaddressandresolvethemanyshortcomingsprevalentinsomanyofthefundseventhoughthesedeficiencieshavebeenknownforquitesometime.Giventhenumberofinactivefundsorfundswithverylittleactivityoveralongperiodoftime,itislikelythatmorecouldbeachievedbyclosingthecompletelyinactivefundsandreturningtotheoperatorstheleviesthathavebeencollectedbutneverutilised.Thefundscouldbereturnedwiththestipulationthattheybeutilisedtohelpdevelopservicestoruralandotherunderservedareaswithparticularemphasisonthedeploymentofmobilebroadband.however,theapproachofclosingfundswithalmostimmediateeffectcouldbechallengingtoimplement.Insuchcases(orevenincaseswherefundscollectmoremoneythantheycanreasonablyspend)anotherpossiblesolutionistograduallyreducetheleviesandphaseouttheUSFovertime.
Inaddition,theGSMAstronglyrecommendsthatgovernmentsthatarecurrentlyconsideringbuthavenotyetimplementedUSFsexploreallotherpossibleuniversalservicecoverageandfundingmechanisms(e.g.,PPP,licenceconditions,etc.)beforemovingforwardwiththecreationofanynewUSFs.
however,incaseswheretheeliminationorgradualphasingoutofUSFsseemsunlikelyorwhereithasalreadybeendecidedtomoveforwardwiththecreationofanewUSF,thereisapressingandurgentneedtoaddress,modifyandcorrecttheunderlyingstructuraldeficiencies,overallconditionsandgovernanceneededtoensurethattheUSFs
canbeaswell-managedandeffectiveaspossibleinrespondingtotheuniversalservicetechnologies,servicesandapplicationsinneedoffunding.Inordertoeffectthesemuchneededimprovementsandmodificationstothefunds,thefollowingelementsmustbeincorporated.
1. Creationofawell-articulatedpolicywithrespecttohowUniversalService(US)goalswillbeachievedandhowtheUSFwillbeputtousetoassistinattainingthesegoals
2.Developmentofanappropriateandwell-definedunderpinninglegalandregulatoryframework
3.EstablishmentoftheUSFasseparate,independent(autonomous)entityfreefrompoliticalinterference
4.Cleardefinitionanddelineationoffundresponsibilities
5.Developmentandcleararticulationofmeasurableoverallfundobjectiveswhichcansubsequentlybetrackedandmonitored
6.highleveloftransparency,visibilityandaccountabilitytoallstakeholders
7.Activeparticipationinandinputfromallconcernedstakeholdersregardingfundobjectivesandadministration
8.Guidelinesandproceduresforworkingwithotherfundingsources
9.Ensurethatthefullrangeofsustainabilityelementsandcomplementary/ancillaryservicesaretakenintoconsiderationinbothpolicyformulationandprojectdefinitions
10.Creationofafairandunbiasedprocesstoallocateprojectsandsubsidies
11.Developmentofincentivesforprojectparticipants
12.Implementationofpoliciesthatincorporatedigitalinclusion
07.
UsF overview tables
Thissectionpresentskeyinformationcountrybycountryintableformat.Theinformationsummarisedinthetablesisintendedtoprovideanoverviewofthestructure,governanceandperformanceofthefundsincludedinthisstudy.Whereavailable,arecapispresentedofthemostrecentUSFprojectsineachcountry.
08.
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8.1
buRkina fasO
buRkina fasO
year fund established: 2000 legal and administrative establishment. 2001: commencement of levy collection.
OverallFundStructureandOperation
Fondd’AccèsauServiceUniversel:thefundismanagedbyARCE(Autoritéderégulationdescommunicationsélectroniques).ARCEisresponsibleforcollectingfundswhereastheresourcesoftheFundaretobemanagedbyaCouncilcomprisedofrepresentativesoftherelevantMinistriesandpresidedoverbytheMinisterofCommunications.
ContributionTypeandFrequency
2% of annual revenue netofinterconnectionpaymentsfromalloperatorshavinganindividuallicence,paidonamonthlybasisandcalculatedonthepreviousmonth’srevenues.TheGovernmentandlocalauthoritiescanalsocontributetothefund.Thelawprovidesforallocationofsomeoftheneworrenewallicencefeesforthebenefitofthefund.
ServicesCurrentlyAuthorisedUndertheExistingFramework
•Fixed-lineprivateresidentialservice•Fixed-linepublicpayphoneservice•Individualmobile-cellularservice•Publicmobilepayphoneservice•Broadband•Tele-centres•Schools(primary,secondarypost-secondary)•healthcentres•Emergencyservices•Specialservicesforpersonswithdisabilitiesandelderpersons•Directoryservices,andotherservicesdefinedbytheregulator
Theaimoftheuniversalservicestrategywastocompletecoverageofthenationalterritory,includingcoverageof5,200villagesby2010.
The2003NationalStrategyidentifieszonestobecoveredbytheuniversalserviceprojectandmandatestheMinistry,throughtheregulator,tocarryoutthestrategy.TheStrategyalsodividedthecountryinto13regions,eachrepresentingaprojectarea(eachareaisequivalenttoanadministrativeregion).The2005UniversalServiceStrategyidentifiedanumberoftargets:•Providepublicvoicetelephonyservicetoanaverageof70%ofselectedrurallocalitiesinagiven
region;•95%ofselectedlocalitiesmustbewithin5kmofonepublicaccesspoint;•Privateservicemustbeavailableinruralareaswithpricesnomorethan25%abovepublishedfixed
andmobiletariffs;and•InternetPOPsineachprovincialcapitalineachtenderedregion.TheICTstrategyfor2006-2010includesgoalsfortheUniversalServiceFund,includingbroadeningtheareascoveredbythefundtoincludetheproductionofmultimediacontentinnationallanguages,theintroductionofICTinhealthandeducation,universalpostalservice,trainingandpromotionofe-jobs.
FundAllocationProcess
OperatorsandothertelecomserviceprovidersareeligibleexceptforoperatorswhodonotcontributetotheFund(thesebecomeeligibleonlyifnocontributingcandidateisselected).Originally,foreachregion,localesnotcoveredbytheincumbent’slicencewereidentifiedwiththeintentionofgrantinglicencestoruraloperatorsthroughatenderprocess.Onlytheincumbent,OfficeNationaldesTélécommunications(ONATEL),andexistingmobileoperatorscanapplyforsuchlicences.Inthefirststage,apilotareawasdefined,workingwiththeincumbentfortheprovisionofservicetothisarea.Underthe2011Decree,theallocationmechanismisthefollowing:•TheRegulatorsetsupalistofvillagesthatareinneedofuniversalservice;•TheinterestedvillagessendalettertotheTelecomsMinisterexplainingtheirrequirements;•TheRegulatorpreparesacomparativestudyoftheprojectsandinvitesoperatorstoapplyfora
project;•OnlyprojectswhicharenotprofitablecanbefinancedthroughtheFund;and•Thefundsaredisbursedonlyaftercompleteexecutionoftheproject.
Governance SupervisioniscarriedoutbytheCouncil.FundsareauditedannuallybytheInspection Générale des Finances,andARCEmustsubmitcertifiedfinancialaccountstotheMinistryofFinanceatthelatestsixmonthsaftertheendofeachfinancialyear.Inaddition,ARCEmustpublishanannualactivityreportbyMarch30ofeachyear.however,noneofthisisdone.
LevelofActivity
inactiveno financial reporting
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8.2
caMeROOn
8.3
cOte d’ivOiRe
cOte d’ivOiRe
year fund established: 1998: legal establishment; 2006: administration and collection
OverallFundStructureandOperation
TheNationalTelecommunicationsFundisanAccountoftheRegulator:Coted’IvoireTelecommunicationsAuthority(CITA).TheaccountwascreatedattheNationalInvestmentBank(BNI).
TheFundismanagedbyaManagementCommittee,nominatedbythevariousMinistries-10members:MinistryofEconomicInfrastructure,PlanningandDevelopment,NationalTreasury,CITAandchairedbyMinistryofFinance&EconomywhichcanbereplacedbytheMinistryofTelecoms.TheManagementCommitteeisassistedbyaTechnicalCommitteecomposedof:•MinistryofFinance&Economy•MinistryofEconomicDevelopment•NationalOfficeforTechnicalandDevelopmentalStudies•CITA•Coted’IvoireTelecom•Onerepresentativeofanotheroperator
caMeROOn year fund established: 2012
OverallFundStructureandOperation
TheTelecommunicationsRegulatoryBoardofCameroon(ART)isinchargeoforganisingandsupervisingtheFund.TheMinisterinchargeisassistedinthedaytodayactivitiesbya:•Technicalsecretariatandacommitteethatselectsthebestprojects;•Financecontrollerwhovalidatesexpenses;and•Accountingofficerwhopaysallexpenses.
ContributionTypeandFrequency
3% of untaxed annual turnoverofoperators;grants(whenprovidedbythegovernment),percentageoffeesforthesale/renewaloflicencesaswellasinternationaldonations,grants,etc.
ServicesCurrentlyAuthorisedUndertheExistingFramework
ThelawrequiresthattheFundprovidesbasictelecommunicationservicestoallatacertainpricinglevel.Italsoincludes:routingemergencycallsfreeofchargeandprovisionofinformationserviceandasubscriberdirectory.TheFundalsopaysallfinancialcontributionstoTelecom/ICTinternationalbodies.
FundAllocationProcess
Competitivebidinaccordancewithpublicprocurementrules.
Governance TheFundismanagedusingpublicaccountingrulesandisauditedbytheMinistryinchargeoftheSupremestatecontrolandaccountingbranchoftheSupremeCourt.TheMinisterinchargeofTelecommunicationsistheONLyauthorisedofficeroftheFund,andreportsregularlytothePrimeMinisteronthemanagementoftheFund.
LevelofActivity Moderate activity.TheFundhascontributedtotheWestAfricanSubmarineCable,financedtheinterconnectionofministerialdepartmentsand,isintheprocessofconstructinganumberoftele-centres.Itisalsoplanningtofinancetheconnectionoflowincomehouseholdsusingfibreoptics,andisparticipatinginconnectingall10regionalheadquartersthroughfibreoptics.no financial reporting to date but the fund is still relatively new.
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ContributionTypeandFrequency
2% of Gross annual Revenues from mobile operators only.Accordingtothe1998Decree,othersourcescanbeused,suchas:•LoansbytheFund•RevenuesfromFund’sinvestments•ContributionsfromStatebudget•Gifts•Othertaxesontelecommunication•Anyothersource
ServicesCurrentlyAuthorisedUndertheExistingFramework
Accordingtothe1998Decree,ruralinfrastructureprojectsarethefocus.Universalserviceisdefined:•Fixed-lineprivateresidentialservice•Fixed-linepublicpayphoneservice•Dial-upInternetaccess•Emergencyservices•Directoryservices.
FundAllocationProcess
Basedoncompetitivebids.
Governance EconomicandFinancialsupervisioniseffectedbytheMinistryofFinance&Economy;technicalsupervisionbytheMinistryofEconomicInfrastructure.
LevelofActivity
Operational. low activity.no known financial reporting.
8.4
deMOcRatic RePublic Of cOnGO
deMOcRatic RePublic OfcOnGO
year fund established: 2002 legally created, not yet functional.
OverallFundStructureandOperation
The2002TelecommunicationsActprovidesthattheFundistobemanagedbytheregulator,butdoesnotmentionanyperiodicreviewsofthefundoruniversalserviceobligations.Sectorcontributions,intheformofalicencefee,godirectlytoPublicTreasury.
ContributionTypeandFrequency
The2002TelecomsActstatedtheintentiontofinancetheprovisionofcoveredservicesthroughafundconstitutedofcontributionsassessedagainstalloperators,providersofservices,andmanufacturersorimportersoftelecommunicationsmaterials.NoamounthasbeencollectedascontributiontotheFundsyet.
Somelicencesprovidethat2% of Gross annual Revenues will also contribute to the usf, those amounts are, in fact, paid only as licence fees.
ServicesCurrentlyAuthorisedUndertheExistingFramework
UniversalserviceisdefinedintheDRC2002TelecommunicationsActastherightofeveryCongolesetobenefitfromvoicetelephone,telex,andpublictelephoneservice,inrural,urbanandisolatedareas.
FundAllocationProcess
N/A
Governance Notknownyet
LevelofActivity inactiveno financial reporting
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SSA USF STUDY
8.6
GHana
8.5
GabOn
GabOn year fund established: legally in 2001: not yet set-up administratively.
OverallFundStructureandOperation
FondsSpécialduServiceUniversel(SpecialFundforUniversalService)isadministeredbytheregulator,AgencedeRégulationdesCommunicationsElectroniquesetdesPostes(ARCEP).TheUSFissupposedtobeaseparateaccountfromARCEP’saccountatthePublicTreasury.TheDirectorGeneralofARCEPwillberesponsiblefortheFund’sreceivablesanddisbursementsunderthesupervisionofthePresidentofARCEP’sRegulatoryBoard
ContributionTypeandFrequency
2% of net revenue per year from fixed and mobile operators.Thefundcanalsobefinancedbyotherfinancialsourcessuchasaidfrompublicorprivatefinancialorganisationsandterritorialgroups.
ServicesCurrentlyAuthorisedUndertheExistingFramework
The2001Lawestablishesthatuniversalservicehastobeprovidedtoeverypersonwhorequestsbasictelecommunicationsservices.Basictelecommunicationsservicesincludeinternational,nationalandlocalfixedtelecommunicationsservicesfortelephone,facsimile,telex,andtelegraph,provisionofemergencycallservice,auniversaldirectory,informationserviceandserviceinthenationalterritorythroughtheinstallationofpublictelephoneboothsalongpublicroads.
FundAllocationProcess
Alltelecomoperatorsareeligible.ARCEPisresponsibleforimplementingtheuniversalserviceprogramme,whichwillallocateFundresourcestooperatorsthroughacompetitivebiddingprocess.ARCEPdetermineswhichcommunitiesareinneedofserviceandthelevelofsubsidiesnecessarytoachievecoverage,andsubmitsaplantotheMinistryforapproval.
Governance FinancialaccountsoftheFundmustbereportedtotheMinistryofTelecommunicationsnolaterthantheApril30ofeachyear,togetherwithamanagementandadministrationreport.AcopyshallalsobesenttotheMinisterofFinance.TheFund’saccountsareauditedbyARCEP’sChiefAccountantandsubsequentlysubmittedtotheAccountingCourtforrevision.
LevelofActivity inactiveno financial reportingOperatorshavebeenrefusingtopaytheUSFleviessince2009orearlierbecausethePresidentialdecreesettingouthowthefundshouldbeoperatedhasneverbeenissued.however,inlate2013,theregulatorissuedademandforbackpaymentandhasalsoissuedaninvoicefor2014-2015.Operatorsarestillrefusingtopay,citingthelicenceconditions.
GHana year fund established: launched in 2004, started in 2005 anddistributed since 2006. Replaced in 2008.
OverallFundStructureandOperation
GIFTELwassetupasanagencyoftheMinistryofCommunications.ItwasestablishedasanindependentagencythatmanagestheFund.GIFECfundsaretobepaidintospecificbankaccounts.GIFECisservicedbyaSecretariatunderthedirectionoftheAdministratorofthefund(ChiefExecutive)anditoverseestheimplementationoftheFund’sprojects.
ContributionTypeandFrequency
Licensedoperators(fixed/mobileoperators,andrecentlylicensedMNPCRDBserviceprovider)contribute 1% of their annual revenue (NetrevenuemeansGrossRevenuelessvAT,NationalhealthInsuranceLevy,CommunicationsServiceTaxandInterconnectCharges).
OtherlegalsourcesofGIFECfundinginclude:•MoniesprovidedbyParliament•MoniesthatmayaccruetotheFundfrominvestmentmadebytheTrusteesoftheFund•Donations,grantsandgifts•AnyothermoniesthatmaybecomelawfullypayabletotheFund.
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SSA USF STUDY
ServicesCurrentlyAuthorisedUndertheExistingFramework
GIFTELwassetuptofacilitatetheprovisionofuniversalaccesstobasictelephonytotheunservedandunderservedcommunities.ProjectsthataresubsidisedthroughGIFECareprioritisedusingthefollowingcriteria:•Provisionofbasictelephonyservicetoruralareas;•Supportfortheestablishmentofaccesstovalue-addedservicesincludingintroductionofInternet
Points-of-Presence(PoPs)ineverydistrict.GIFECwidenedthescopeofitsmandatetoincludetheprovisionofaccesstoelectronicservicesincludingICT,broadcasting,internet,multimediaserviceandbasictelephony,fortheunservedandunderservedcommunities.
FundAllocationProcess
Disbursementmainlytakestheformofnon-commercialbutcompetitivegrants:•Forpublictelephonyprojects,InternetPoint-of-Presenceandtrainingcontractsbyopen
tender;and•Toapplicationsinruralareas,whichdonothaveservices,orseekingsupportfor‘ruralpackages’
toenhanceaccesstoservicesforpublictelephonykiosksortele-centresbutareseekingamountslessthanacertainUS$threshold,shallbebydirectdisbursementbasedonabusinessplandemonstratingfinancialviabilityorself-sustainability.
Byendof2009,projectshadbeenallocatedbasedonacompetitiveprocess:leastsubsidyrequestedfromqualifiedbidders.Infrastructuresubsidiesaretypicallyprovidedtothefirstentrantinanareaandthennewentrantssharethemast.
Theboardevaluatesproposalsfortheirtechnicalandfinancialviability.Criteriaforselectingtownsandvillagesfortheprojectdependonlocation,populationandsocio-economiccharacteristicse.g.,numberofschools,healthservices,economicactivities,telecommunicationssignalavailabilityandgeographicobstacles.
TenderingisconductedthroughtheNationalCompetitiveTenderingproceduresspecifiedinthePublicProcurementActoftheRepublicofGhana.Anycompanywhichimplementsprojectsto
Governance BoardofTrusteesofGIFEC:10trusteesthatincluderepresentativesfromtheNationalCommunicationsAuthority(NCA),theMinistryofCommunications,theparliamentaryselectcommitteeoncommunications,arepresentativefromeachlicensedtelecomoperatorandtheadministratorofthefund.TheMinistermaydirecttheTrusteesoftheGIFEConmattersofpolicy.
LevelofActivity High activityThefundhasbeenactivelydisbursingfundssince2006.no consistent financial reporting.UnderitsUniversalAccesstoElectronicCommunicationsProgramme,GIFECoversawthefollowinginitiatives:•CommonTelecommunicationFacilityProject:Since2006:Constructionoftowersforco-location
bytelecomoperatorstoextendtelecomservicestounderservedareas.41towersconstructed.•LastMileInitiativeProject:Since2006,incollaborationwithUSAID/Ghanaandpossibly
UNDP,pineappleandcitrusproducingareasaretargetedandprovidedwithaccesstotelecommunications/ICTservices.OnepilotprojecthasbeencompletedatNsaakyeintheEasternRegion.AsecondprojectisconstructedatGeorgefieldsnearKasoaintheCentralRegion.Thisistobeextendedtocotton,mango,andriceproducingareas.
•CommunityInformationCentresProject:project,whichGIFEChasbeenimplementingonbehalfoftheMinistryofCommunicationswithfundingfromthehIPCInitiative.Establishinghybridfor-profittele-centreandnon-profitcommunityresourcecentrestargetingthegeneralcommunitymembers,schoolchildren,youthoutofschool,womenandwomen’sgroups,privatebusinesses,non-governmentalorganisationsandlocalgovernmentauthorities.By2010,120CICsareatvariousstagesofcompletionin100districts/municipalities.Underacost-sharingagreementbetweentheMinistryofCommunicationandtheUnitedNationsDevelopmentProgramme,79CICshavebeenequippedwithICTequipment,networkinfrastructureandtrainedCentreManagers,makingthemoperational.Theremaining70districts/municipalitieswilleachhaveatleastoneCICasenvisionedinGIFEC’sstrategicplanfor2010-2012.
•LibraryConnectivityProject:EstablishmentofICT-basedMobileDigital-cottages(MD-Cs)andRegionalDigitalLibraryInformationCentres(RDLICs)inordertopromoteandfacilitateaccess.
•RuralPayPhoneProject:GIFECintendstoprovide12,000ruralpayphonestounderservedcommunitiesduringthethreeyearperiod2010-2012(theEQUATELproject).
•EasyBusinessConnectivityProject:toenhanceavailabilityofseedfinancingonflexibleandreasonabletermsforentrepreneursseekingtooperatee-powerede-businesscentres.
•PostOfficeConnectivityProject:toselect10PostOfficeswiththerequisitephysicalinfrastructuretoenablethedeliveryofbasicInformationTechnologyandtelecommunicationservicesinthepilotphase,then70PostOfficesforSecondPhase(2011-2012).
•DisabilityEmploymentProject:implementedbyGIFECandNCPDistheEasyBusinessCentresforPersonswithDisability.
•SecurityConnectivityProject:toestablishstateoftheartICTTrainingCentreatthePrisonsTrainingSchool.
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SSA USF STUDY
8.7
lesOtHO
•SchoolConnectivityProject:providingeducationalinstitutionswithhighspeedcomputers,printers,scanners,projectorsandserversandlinkingthemwithinternetaccess.Theprojectstartedonapilotbasisin2008.In2009GIFECprovidedsupportto50schools.By2010,GIFEChadsupportedtwohundredandsixty-three(263)educationalandtraininginstitutions.TheplanwastoprovideICTequipmentandconnectivitytotwohundred(200)educational,vocationalandtraininginstitutionsbetween2010-2012.
•CommunityInitiativeProject:ToestablishstateoftheartICTTrainingCentreforRuralCommunitiesacrossthecountryandprovidetrainingincomputerskillsandliteracy.
•FishingProject:incollaborationwiththeFisheriesCommissionandtheNationalCanoeFishermenCouncil,tointroduceenhancedfishingtechniquesusingstate-of-the-arttechnologytoaddressthefishingneedsoftheartisanfishermen–toberolledoutin2012.
•ICTCapacityBuilding:2010-2012,GIFECintendstofundtheprovisionofbasicICTTrainingtoover12,000peopleintheunderservedandunservedcommunitiesusingtheCICfacility.
GIFECiscollaboratingwithallthemajortelecommunicationsoperatorsintheprovisionofCommonTelecommunicationsSiteFacilitiesinselectedareasacrossthecountryundertheUniversalAccesstoTelecommunicationsProgramme(UATP).ThecollaborationinvolvestheawardofsubsidiestowillingandeligibletelecommunicationsoperatorsfortheprovisionofCommonTelecommunicationsSiteFacilities.
lesOtHO year fund established: 2009
OverallFundStructureandOperation
LesothoCommunicationsAuthority(LCA)UniversalAccessFundisperatedbytheRegulator.TheSecretariat,anon-votingmemberoftheoversightCommittee,executesthedecisionsoftheCommitteeandisresponsibleforthedaytodayrunningoftheFund.LCAservesastheTreasureroftheCommittee.
ContributionTypeandFrequency
• 1% of net Operating income of licensed operators on an annual basis.•25%ofNRAoperatingsurplus.•FundreceivedUS$1.25millionseedcapitalfromtheRegulatorin2008.•FundcanalsoreceiveGovernmentcontributionsandgrants.•UniversalServiceFundCommitteeisresponsiblefordesignatinglicenseesrequiredtomake
contributionanddeterminestheamount.
ServicesCurrentlyAuthorisedUndertheExistingFramework
Policyandregulation,theprimaryobjectiveisbasicaccessforeveryonethroughuniversalnetworkcoverage,althoughtheStrategy2007alsorecognisestheconcernsofpeoplewithdisabilitiesordisadvantagedgroups.
Allvillageswithatleast150householdsmusthavenetworkcoverageandcommunicationsserviceaccesspointsandallpeoplemusthaveacommunicationsservicepointwithina4kmradius.
TheCommunicationsAct2012delegatesauthoritytotheFundtoensureaccesstobasicdomesticandinternationaltelephonyservicesandinternet,diverserangeofradioandtelevisionbroadcastingservices,basicpostalservices.USFCmayalsodecidetousefundtowardsinfrastructureforunserved/underservedareas,tele-centres,internetexchangepoints,acquisitionofsatellitecapacityforbroadcasting,publicbroadcastingservices,electrificationofpostoffices,universalpostalservices.
FundAllocationProcess
CompetitiveBid.TheUniversalServiceFundCommitteedecidesonfundsallocation.Thefundrecipientresponsibleforprovidingperformancereports.LCAidentifiesUSFsitesandthenissueRFPs.AlllicensedoperatorsparticipateintheRFP(RequestforPricing)process.
Otherentities,suchasbroadcasters,serviceproviders,contentdevelopers,publicaccessICTtele-centres,schools,hospitals,ruralclinicsandotherswillbeeligibletoreceivefundsfromtheUSFdependingupontheprogrammesandinitiativesselectedeachyearbytheFundAdvisoryCommitteeinconjunctionwiththeMCST.
Governance ThereisanindependentlyconstitutedoversightCommitteeoftheBoard(representativesofMinistriesofCommunication,LocalGovernmentandFinance)whichisresponsibleforstrategicandpolicylevelmanagementofthefundandfunctions.TheUSFaccountsareauditedbytheAuditorGeneralandpublishedintheLCA’sAnnualReport.Alltelecomoperatorsareeligible.
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SSA USF STUDY
8.8
MadaGascaR
MadaGascaR year fund established: 1999 legal and administrative establishment: 2002 collection and disbursement.
UnderlyingFrameworkforFund
•Actno.96-034of27January1997.•DecreeNo.99-191relatingtoModalitiesforImplementationandFundingofAccessto
TelecommunicationsServices(March10,1999)establishedtheFund.•DecreeNo.2003-1068onExtendingtheObjectivesoftheTelecommunicationsDevelopmentFund
(Nov.4,2003)andDecreeNo.2004-329AmendingtheProvisionsofArticleIofDecreeNo.20031068(March16,2004).
•ActNo.2005-023of17October2005ontheRevisionofLawno.96-034of27January1997ontheInstitutionalReformoftheTelecommunicationsSectoridentifiesuniversalaccessandtheloweringofcostsasaprinciplegoal,anddirectstheministerinchargeoftelecommunicationsandICTstoestablishafunddedicatedtothedevelopmentoftelecommunicationsandICT,andsupportareasthatareotherwiseunserved.
OverallFundStructureandOperation
FondsdeDéveloppementdeTélécommunicationsetTIC(TelecommunicationsandICTDevelopmentFund)administeredbytheregulator-OfficeMalagasyd’ÉtudesetdeRégulationdesTélécommunication(OMERT)asaseparateaccount.
ContributionTypeandFrequency
TheFundistobefundedfrom:•Annualcontributionsofoperators,whichareequalto2% of their gross revenuesearnedfrom
operatingpublictelecommunicationsnetworksandtheprovisionofpublictelecommunicationsservices
•Thegovernment’sgeneralbudget;•Publicorprivatecontributionstothefund;and•Localcommunitiesseekingtoimprovetelecommunicationsintheirareas.
ServicesCurrentlyAuthorisedUndertheExistingFramework
Includedinuniversalserviceare:•Providingaccesstoapublictelephonynetworklocatednomorethan10kmfromthecentreofa
ruralcommunityof500ormorepersons;•Providingapublicaccesspointinanurbanareathatiswithin2kmofallhabitations;•Ensuringthefreeroutingofemergencycalls;and•Dial-upInternetaccessanddirectoryservices.The2003and2004Decreesextendtheuseofthetelecommunicationsdevelopmentfundsforthestudythepossibilityofinternationalconnectivitytounderseafibreandanationalbackbone.
FundAllocationProcess
Thefundsaredistributedonacommunity-by-communitybasis,withthespecificprojectsbeingdefinedbyOMERTwhichdetermineswhichcommunitiesareinneedofserviceandthelevelofsubsidiesnecessarytoachievecoverage,andsubmitsaplantotheMinistryforapproval.
Thelistofprojectsisthensubmittedtothenationalfixedoperatorstoenquirewhetheranyofthemwillservetheareas.Ifnoneoftheoperatorsaccepttotakeontheprojectwithoutfunding,theprojectsaretobeattributedviaatransparentandcompetitiveselectionprocessamonginterestedoperators.OMERTfirstrunsarestrictedtenderprocess.Projectsforwhichnoqualifiedapplicantswerefoundaresubjecttoanopencompetitiveprocess.
LevelofActivity low activitysome financial reportingTherewere4networkcoverageinfrastructureprojectscompletedin2010/2011:•Threesitesathloahloeng(Mohale’shoek);•OnesiteatLitsoetse(ThabaTseka)•TwositesatMakhunoane(Botha-Bothe)and•TwositesatTsatsane(Quthing).Intermsofimpactthe2010/11projectsprovidedcoverageto
morethan16,000peoplefrom87villagesinthedistrictsmentioned.TheInternetExchangePoint:thisinitiativeoftheFundistofacilitatetheestablishmentoftheInternetExchangePoint(IxP).Thisprogrammeinvolvedtheprovisionofinternetservicestoallinstitutionsofhigherlearning.For2012/13,theFundisexpectedcontinuetofocusoncoverage,althoughithasbeenindicatedthatthereareplanstorolloutinternetaccesscentresbutnoactivityhasbeenreportedsincethe2011annualreport.
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SSA USF STUDY
8.9
Mali
Governance OverseenbytheTelecommunicationMinistry.Fundaccountsmustbeverifiedbyanindependentaccountant.
LevelofActivity Moderate activityno financial reportingBytheendof2009,theUSFhadfinanced:•1vSATforunderservedcommunities;•Publicaccessandprivateservicetovoice-theincumbentfixedoperator;iseligible•1AccessRegion;•DistrictsandCommunes;and•PublicaccesstoandPrivateServiceforvoiceandInternet.PartoftheUSOisusedtofundpartofthePICOMproject(aspecificentityhandlingTelecommunicationMinistryinfrastructureprojects,alsofundedbytheWorldBank).ItisestimatedthatthemajorpartoftheFundhasbeendistributedtoTelmaunderthesubsidiesprocess.OtherexampleincludesthevillagePhoneProject,wherebasedonanagreementbetweenAirtelandtheTelecommunicationsMinistry,theMalagasyGovernmentissupposedtocontributeabout40%ofthevillagePhone(similartotele-centre)equipmentthroughtheFund.
Mali year fund established: 1999
UnderlyingFrameworkforFund
TelecommunicationsOrdinanceNr.99-043onSeptember301999,definedUniversalServiceinArt.8,andinArt.12statedthatfuturedecreeswoulddefineservicescoveredbyaUniversalServiceFund.TelecommunicationsOrdinancesNr.2011-023andNr.2011-024onSeptember282011providedtheframeworkfortheactivitiesandorganisationoftheFund.
OverallFundStructureandOperation
L’AutoritéMaliennedeRegulationdesTelecommunications/TICetPostes(AMRTP),anindependentlegalentitywithfinancialandadministrativeautonomy,administersandmanagestheFund.
ContributionTypeandFrequency
1% of annual revenues from licensed operators
ServicesCurrentlyAuthorisedUndertheExistingFramework
TheFundwasestablishedtoallowtheofferingofbasictelecommunicationsservicestoall,including:nationalandinternationalaccess,text,facsimileandinternetaccess.TheservicesmustmeettherequirementsassetbytheRegulator.Also,thetelecomcompaniesshouldprovideaccesstoaprintedorelectronicdirectoryandtoemergencynumbersfreeofcharge.Servicesshouldbeprovidedinremoteareasatacostaccessibletoall.healthservices,educationandhandicappedindividualsshouldbeconsideredpriorities.
FundAllocationProcess
Publicbiddingprocess.
Governance AMRTPisformedbya:•BoardofDirectors:sevenmembersnominatedbytheCouncilofMinistriesbasedontechnical,
legaland/oreconomicalknowledgeofthetelecommarketaswellasnewtechnologies.ThePresidentoftheRepublicselectsthreemembersfromthosenominatedbytheMinisters;thePresidentoftheGeneralAssemblyselectstwomembers;andthePresidentoftheFinancial,CulturalandSocialCouncilselectstheothertwo.
•GeneralDirector:fivemembersinchargeofthedaytodayoperationsoftheAMRTP.ThemembersareselectedfromapublicapplicationcallbytheCouncilofMinistries.
LevelofActivity inactiveno financial reportingTheFundhasnotbeenusedtodate.ThereisadisputecurrentlyunderwaybetweentheAMRTPandtheGovernmentregardingtheAMTRP’splanstoallocatethefundstonon-telecomrelatedexpensesincurredintherecentinsurrections/civilunrest.
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8.10
MauRitania
MauRitania year fund established: 2002
UnderlyingFrameworkforFund
telecommunication lawofJuly111999regulatesthetelecommunicationsmarketandservicesinMauritania.Thelawalsoprovidesinits“GeneralDispositions”thedefinitionfortheprovisionofUniversalAccessServicestothepeopleofMauritania. decree nr.2001-06onJune272001createdtheUniversalAccessServicesAgency.Thedecreealsoestablishestheaccounting,financialandlevysystemsfortheFunds.decree nr. 2002-06ofFebruary72002,establishedtheorganisationandfunctioningoftheFund.
OverallFundStructureandOperation
TheoverallFundisadministeredbytheAgencyforthePromotionofUniversalAccessServices–APAUS(Agencedepromotiondel’Accèsuniverselauxservices)whichisinchargeofimplementingaprogressivegeneralisationofessentialservices(water,electricity,telecommunicationsandICTs).
ContributionTypeandFrequency
APAUSreceivesmoneyfromthenationalbudget,contributionsprovidedbyinternationalagenciesandothergovernments,andcontributionsfromthetelecomsector:3% of the gross revenuespaidannually.Telecomcontributionsaretobeusedonlytofundtelecomprogrammes.
ServicesCurrentlyAuthorisedUndertheExistingFramework
TheUSFforTelecommunicationswasoriginallyestablishedtoprovidebasictelecommunicationsservicestoallinhabitantsofMauritaniathroughtheestablishmentofcallcentresandcommunitytelephonestoavoidlongwaitingperiodsandtravellinglongdistancestoaccesstheservices.Later,theservicesincludednotonlybasictelecombutICTsaccesstobeachievedby2015(MillenniumDevelopmentGoals).TheFundhasconcentrateditseffortsonprovidingservicesto3,040villageswithpopulationsover100,000andruralareaswithapopulationof1,000inanareaof1,000,000km2inthedesertareas.
FundAllocationProcess
Public,openbiddingprocess.
Governance APAUSisanindependentlegalentitywithfinancialautonomy,formedby:•GeneralBoard–formedbyonerepresentativefromMinistryofTelecommunications,onefrom
theMinistryofFinances,onefromtheTelecommunicationRegulatoryAuthority,oneprofessionalrepresentingtheProfessionalAssociation,andrepresentativesofallsectorsinvolved(nonumberisprovided).TheBoardMembersserveforthreeyears.TheBoardselectsitsPresidentfromalistprovidedbytheCabinet,andnameanddestitutetheGeneralManager.
•TheGeneralManager–managesandcoordinatesalltheworkoftheAgency,ensuresalllaws,decreesandnormsarefollowbytheAgencyandmanagestheUAF.
•Technicalmanagers:namedandselectedbytheBoardfromlistsubmittedbytheGeneralManageraspertheneedsoftheAgency.
LevelofActivity Moderate to low activityno financial reportingThetelecommunicationssectoroftheUAFisprovidingthefollowingservices82.however,noactivityappearstohavebeenreportedsince2012.•ImplementationofanInformationandTelecommunicationsCentreforpeoplewithdisabilities–
trainingandservices.•Multifunctionplatformsproject–nationalreach(coverage)•Cybercitiesproject–projectstoprovideICTservicestothecitiesofAtar,Selibabi,andAkjoujt
(alreadypartiallyworking).•FibreOpticNationalNetwork–projecttolinkregionalcapitalsandprovideinternational
connectivity(AfricanCoasttoEurope-ACEcable).ThisprojectisinpartnershipwiththeWorldBank.
82. www.access.mr
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8.11
MauRitius
MauRitius year fund established: 2008
UnderlyingFrameworkforFund
•InformationandCommunicationTechnologiesAct2001.•FundformedundertheInformation&CommunicationTechnologiesAuthority,ICTAand(Universal
ServiceFund)Regulations2008(asamended)(GN206/2008).
OverallFundStructureandOperation
•AdministrativeunitandaccountmanagedbytheExecutiveDirectorofNRA(ICTA).•TheFundAdministratoroverseesFundactivities.•TheProjectManagerisresponsibleforanalysingmarketconditions,developingproposedproject
plansandactingasliaisonwithUSFfundingrecipientsintheimplementationandevaluationofapprovedprojects.
•Liaisonofficers:withintheAuthority(Engineers,attorneys,accountant,economist,etc.)areresponsibleforextendingprofessionalsupportandresourcesintheirfieldsofresponsibilitytothemanagement.
ContributionTypeandFrequency
Eitherapercentageofturnoverorapercentageofthepriceofeveryincomingcalloneachoperator’snetwork.Fromalloperators,bothfixedandmobile:•Annualcontributiontobepaidinmonthlyinstalmentsbyoperator-5% of gross revenue generated
by operator from provision of international roaming service forthatmonthand•us$ 0.025 on every minute of international calls terminatedbyoperatorinthatmonth.ICTAhasalsogivengrantstotheFund(29%oftheoverallvaluebytheend2009).ICTAiscurrentlyinvolvedinlegalproceedingswithoperatorswhohavefailedtopay.
ServicesCurrentlyAuthorisedUndertheExistingFramework
PublicaccesstovoiceandInternetIncreasedbroadbandpenetrationSpecialistservicesforpeoplewithdisabilities.Itisenvisagedthatspecialisedservicesatspecialtariffsshouldbeprovidedtopeoplewithdisabilitiesatnoextrachargesorevenatbelowcost83.
FundAllocationProcess
Competitivebiddingprocessopentoalloperators.BiddingprocessopentoalllicensedISPstoprovideuniversalserviceandaccesstoInternet-toinstall,provideandmaintainWi-Fiaccess.ThebiddingexerciseisoverseenbyICTA.
Governance BoardofNRA,uponrecommendationofUASFAdvisoryCommittee.
LevelofActivity Moderate activityno financial reporting at present duetoongoingdiscussionswithoperatorswhoarerefusingtopaythelevy.Bytheendof2009,fundshavebeeninvestedforfourCommunityPublicAccessPoints.Ongoingproject:UnderWi-FiMauritius,deploymentofWirelessFidelity(Wi-Fi)Networktoincludeworkstationswithfreeinternetaccessforcitizenswithoutthenecessaryterminalequipmentacross10Wi-FizonesinfivemunicipalcouncilsandfourdistrictcouncilsinMauritiusaswellasanadministrativebuildinginRodrigueswasachievedinMarch2012.The2013USFBudgetincludesprovidingvisuallyimpairedstudentswithBraillepersonalcomputersfreeofcharge.
83. ICtA – Consultation paper February 2004
79
SSA USF STUDY
8.12
MOzaMbique
MOzaMbique year fund established: 2004/ 2006 legal established. 2008 collection.
UnderlyingFrameworkforFund
•TelecommunicationsLawNo.8of21July2004.•DecreeNo.69of26December2006approvedtheregulationofUniversalaccessandService
Fund.TelecommunicationPolicy2004.•MinisterialDiploma79/2007dated4July2007ontheannualcontributiontobepaidtothe
UniversalServiceAccessFundbythetelecomoperators.
OverallFundStructureandOperation
TheUniversalAccessFund,FundodoServiçodeAcessoUniversal(FSAU,UASF)isaninternalunitandaccountundertheregulatorInstitutoNacionaldasComunicaçõesdeMoçambique,regulatoryagency(INCM)managedbytheExecutiveSecretaryoftheUASF.ThemanageroftheFundreportstotheBoardofDirectorsofINCM.
ContributionTypeandFrequency
•Alllicensedandregisteredentitiesrenderingtelecommunicationspublicservicesmustcontribute1% of net operating income of the previous yeartotheUASF.
•OperatorswhoareoperatingInternetCafesareexemptfromcontributionstotheUASF.•Government.DevelopmentPartner(internationaldonors)grants.
ServicesCurrentlyAuthorisedUndertheExistingFramework
Servicescovered:•TelephonyandInternetservices.•PublicandPrivateInternetaccessandservice.•Infrastructuredeploymentandserviceprovision.hospitalsandschoolslocatedinruralareascanalsobenefitfromthefund.TheFund’sobjectivesaretopromoteservicetoruralareasatafairandaffordableprice(publiclyaccessibletelephoneswithinalllocaleswithmorethan1,000inhabitantsaswellaswithin5kmofeveryruralinhabitantandInternetpointsofpresenceandpublicaccesstotheInternetthroughtelecentresinallDistrictCentres).
FundAllocationProcess
CompetitiveBid–least-subsidyrequested.
Governance BoardofINCMoverseestheactivitiesanddecisionsofUSAF.
LevelofActivity limited activityno financial reporting.•MozambiqueundertookanInternetservicepilotprojecttoprovidefourDistrictCentresin
theprovincesofZambéziaandNampulawithInternetPOPs.TheinternettenderwaswonbyMozambicanbroadbandwirelessoperatorINTRALda.
•Asimilartelephonypilottenderdidnotreceiveanybidsandwasthereforeunsuccessful.•US$200,000wasdisbursedin2008foratransmissionviasatelliteprojectofmobiletelephony
covering5kmfromthecentreofadistrictofMatchedjeontheborderwithTanzania.•TheWorldBankfinancedcertaintele-centrespilotprojectsandaCommunityPublicInternet
AccessPointsproject.•McelwonatenderinJune2011tobuildBTSsitesin14localities,inaprojectofapprox.US$4
million.
80
SSA USF STUDY
8.12
niGeRia
niGeRia year fund established: 2003 legal establishment. 2004 collection. 2007 administrative disbursement.
UnderlyingFrameworkforFund
TheNigerianCommunicationsActof2003addressestheconceptofuniversalaccessanduniversalserviceandprovidesguidancetotheNigerianCommunicationsCommission(NCC)onthedevelopmentofuniversalaccess/servicepoliciesanddirectstheestablishmentofaUniversalServiceProvisionFund.The2007UniversalServiceandUniversalAccessRegulationsestablishedtheUSPFund(USPF).
OverallFundStructureandOperation
Since2007,theNigerianUniversalServiceProvisionFund(USPF)isaseparateentitymanagedbytheSecretaryofUSPF.
ContributionTypeandFrequency
OperatorsdonotcontributedirectlytotheUSPF.Operatorsarerequiredbyalicenceconditiontopay 2.5% of net operating revenue, (annual Operating levy, aOl) to the ncc on a quarterly basis. the ncc, in turn, contributes 40% of the aOl to the usPf for its activities. Accordingtothe2007Regulation,theUSPfundistobefinancedbasedon1% of net revenues (netofinterconnectionpayments)ofthelicensees.NCChasthediscretiontoincreaseordecreasecontributiontotheUSPFuponconsiderationoftheUSPFoperatingexpensesandbasedonrecommendationmadebyUSPF.TheUSPFmaybefundedfromothersources:•MoniesappropriatedtotheUSPFbytheNationalAssembly;•Gifts,loansaidsandsuchotherassets.
ServicesCurrentlyAuthorisedUndertheExistingFramework
Theobjectiveofthe2003ComsActisencouragingtheinstallationofnetworkfacilitiesandtheprovisionofnetworkservicesandapplicationstoinstitutionsinunservedandunderservedareasorforunderservedgroups.Universalservicecoversthefollowingservices:•Individualmobile-cellularservice•Publicmobilepayphoneservice;•Broadband•Tele-centres•Schools(primary,secondarypost-secondary)•healthcentres•Emergencyservices•Specialservicesforpersonswithdisabilitiesandelderpersons•CommunityCentres•Governmentoffices
Currently,theFundhasfourprogrammes:•UniversalAccessProgramme•UniversalCoverageProgramme•UniversalServiceProgramme•ICTforDevelopmentProgramme
FundAllocationProcess
TheUSPSecretariatisrequiredtoundertakeananalysistodetermineformallywherefundmoneyshouldbedirectedandspecificallytheservicescopetobeapplied.Projectsareallocatedthroughacompetitivebiddingusingdifferentmethods:•Competitive•Combinationqualityandcostselection•Competitive,leastsubsidyrequestedfromqualifiedbidders•Proposalbyeligiblecandidates&evaluationbyUSPF.
Governance USPFBoard(ChairedbytheMinisterwithrepresentationfromNCC)supervisesandprovidesbroadpolicydirectionforthemanagementoftheUSPF.ItappointsandremovestheUSPFundmanagersandauditorsinconsultationwiththeNCC.TheUSPFundmanagersreportonaquarterlybasistotheUSPBoardandtheUSPSecretariatonthestatusofthefundincludingareportdetailingthefinancialsituationandperformanceofthefund.DuetoanumberofoperatingchallengesandperceivedinefficienciesintheFund(asidentifiedbythefundadministratorsthemselves),aprocessiscurrentlyunderwaytorevampthewayinwhichtheFundoperatesandseveralpilottrialsareunderway.
81
SSA USF STUDY
LevelofActivity High activityno consistent financial reporting.ApproximatelyUS$140millionperannumindisbursementsfromlevies.however,disbursementhasbeenheldupinsomeyearsduetodelaysinParliamentarybudgetapprovalUSPSActivitiesandProjectsin2009•CommunityCommunicationsCentreProject•AcceleratedMobilePhoneExpansionProgrammes•Co-locationInfrastructureProject•BaseTransceiverStationProject•Solar-PoweredGSMforRuralNetworkProject•RuralBroadbandInitiativeProject•BackboneTransmissionInfrastructureProject•SchoolsAccessProject•TertiaryInstitutionAccessProject•GISmappingofICTsInfrastructure,GapAnalysisandSubsidyEstimatesinNigeria
8.14
niGeR
niGeR year fund established: 1999
UnderlyingFrameworkforFund
Decreeno.99-45issued26October1999,amendedbyOrdinanceno.2010-89of16December2010createdaUniversalAccesstoServiceFund(TheTelecommunicationsDevelopmentFund).
OverallFundStructureandOperation
AlthoughoriginallyanaccountoftheRegulator-l’AutoritédeRégulationMultisectorielle(ARM),anautonomousentityhasbeenrecentlyestablishedtomanagethefundbutisnotyetfunctioning.
ContributionTypeandFrequency
•After2003:4% of annual net (gross) revenuefromalllicensedoperators(somehavefailedtocontribute).
•Inthefirsttwoyearsofthelicence,mobileoperatorswererequiredtomakecontributionsof35millionCFAfortheyear2002and70millionCFAfortheyear2003.
•Inaddition,ajointfundingsystemhasbeenestablishedbytheITU,theWorldBank,theUnitedNationsDevelopmentProgramme(UNDP),theOrganisationInternationaledelaFrancophonie(OIF),theGovernmentofNigerandseveralnon-governmentalorganisations.
ServicesCurrentlyAuthorisedUndertheExistingFramework
Telecommunicationsinfrastructureandapplicationsinruralareas.
FundAllocationProcess
Thereisnovisibilityonthefundallocationrules.Allcontributors(i.e.,licensedoperators)areeligibletoparticipate.AccordingtoDecreeno.99-45,theregulatoryauthoritylaysdownoptimumstandardsfortheselectionofoperatorsthatwillprovideuniversalaccesstoservices.Bypublictender,theregulatoryauthorityallocatesthetasksofimplementinguniversalservicestoselectedoperators,whoarepaidfromtheFund.
Governance MinistryofCommunications.
LevelofActivity inactiveno financial reporting
82
SSA USF STUDY
8.15
sOutH afRica
RePublic Of sOutH afRicat
year fund established: 1997
UnderlyingFrameworkforFund
•TelecommunicationsAct,1996.TelecomsAmendmentActof2001•AssociatedUniversalServiceandAccessFund(“USAF”)Regulationsof1999•ElectronicCommunicationsAct,2005•USAFContributionsRegulationof10February2011•DraftBroadbandPolicy,2009
OverallFundStructureandOperation
USAFisadministeredbyUniversalServiceandAccessAgencyofSouthAfrica(“USAASA”),aseparatelegalentityresponsibleforpromotinguniversalserviceandaccessinthecountry.
ContributionTypeandFrequency
•USAASAisfundedbycontributionsfromlicensedoperatorsofelectroniccommunicationservicesandnetworksandbroadcasters(thelattermayoffsettheircontributionagainstacontributiontoabroadcastingsectorMediaDevelopmentandDiversityFund).
•ICASAdeterminesthebasisofoperators’contributions,whichmaynotexceed1%oftheirannualturnover.
•Currently,thecontributionissetat0.2% of annual turnover(totalrevenuefromlicensedactivity,lessserviceproviderdiscounts,agencyfees,interconnection,andfacilitiesleasingcharges,governmentgrantsandsubsidies).
•ICASAcollectsthecontributionsandsendsthemtotheNationalTreasury.
ServicesCurrentlyAuthorisedUndertheExistingFramework
ECAstipulatesthattheFundshouldbeusedexclusivelyforpaymentofsubsidiesto:•Assistneedypersonstowardsthecostofbroadcastingandelectroniccommunicationsservices•PublicschoolsandpublicFurtherEducationandTrainingInstitutionsfortheprocurementof
broadcastingandelectroniccommunicationservicesandaccesstoelectroniccommunicationnetworks;
•Establishandoperatebroadcastingservicesandoperation,includingtrainingofandthepaymentofallowancestopersonnel,ofcentreswhereaccesstoelectroniccommunicationnetworkscanbeobtained;
•Anybroadcastingservicelicenseeandelectroniccommunicationsnetworkservicelicenseeforthefinancingoftheconstructionorextensionofelectroniccommunicationsnetworksinunder-servicedareas.
FundAllocationProcess
•CompetitiveBid.•USAASAmanagesthefundsandidentifiesprojects.•Anyareawithlessthan5%penetrationisdeemedunderservedandiseligibleforUSALproviders.
Governance TheMinisterofCommunicationsappointstheUSAASABoard.TheBoardretainsfullandeffectivecontrolandmonitorstheexecutivemanagementanddecisionsoftheAgency.howeverduetothewidespreadallegationsofcorruptionandmismanagement,seniormembersofthefundmanagementteamweresuspendedinSeptember2011andaforensicauditwasordered.Subsequently,someofthesuspendedmembersunderinvestigationresigned;theMinisterappointedanewboardinSeptember2012andasearchforanewCEOwascompleted.
LevelofActivity Moderate activity althoughmostactivitiesweresuspendedforalmostayeardatingfromSept.2011whentheboardwassuspended.limited financial reporting(reportsarepublishedbutlackfullfinancialdetail).Thisappearstobechanging.Projectshaveconsistedoftele-centres,cyberlabs,multi-purposecommunitycentres/Thongservicecentresandunder-servicedarealicences(USALs).Therewere27underservedareasandUSALprojectsinsevenoftheseareasbytheendof2007.USAASAissuedlicencestobidderswinningUSAFsubsidies.Someprogrammesfocusonpeoplewithdisabilities,forexample,theaccesscentreinTembisa.Thefollowingprojectswereearmarkedforfundingfromthe2010allocation:•ImplementationofhandoverstrategyforCommunityICTAccessCentresandE-SchoolCyberlabs•FacilitationofInternetconnectivitytoschoolsandAccessCentres•ImplementationofRapidDeploymentofnewAccessCentresstrategy•DevelopmentofaUniversalServiceandAccessFundManual•SubsidiseinternetconnectivityattheFETcolleges
83
SSA USF STUDY
RWanda year fund established: 2004
UnderlyingFrameworkforFund
TheUniversalAccessPresidentialOrder05/01of13/03/2004establishedtheUAF(UniversalAccessFund).
OverallFundStructureandOperation
TheUniversalServiceFundisanadministrativeentityandwithanaccountadministeredbytheregulator,RwandaUtilitiesRegulatoryAgency.
ContributionTypeandFrequency
2% of Gross annual revenues,netofinterconnectionpaymentsfromalloperators.TheFundhasreceivednumerousgrantsfrominternationaldonors,mainlytheWorldBank.Theircontributionsformed68%ofthetotalfundingbytheendof2009.
ServicesCurrentlyAuthorisedUndertheExistingFramework
•Publicvoiceaccessandprivatevoiceservice•PublicaccesstoInternet,PrivateInternetservice•2008focuswasonloweringbandwidthcostsandtheextensionofICTsinruralandpoorurban
areas.NetworkextensionisbeingaccomplishedthroughconnectingkeyRwandaninstitutions.
FundAllocationProcess
Competitivebiddingprocessbasedonleastsubsidyrequestedfromqualifiedbidders(operatorsandISPs).FundsalsoallocatedthroughtheMinistryofEducation(toPCprovidersfortheOneLaptopperChildProgramme).
Governance BoardoftheNRA.
LevelofActivity Moderate activityno financial reportingBytheendof2009thefollowingprojectswereunderway:•RuralTelephonyProject•LowpricesforInternetconnectivityandPublicaccesstoInternet•OneLaptopperChildProgrammeMorerecentprojectsinclude:•vSATconnectivitysubsidytoalldistrictsinremoteandruralareas;•Bandwidthconnectivityof30Tele-centresmanagedbytheRwandaDevelopmentBoard;•Connectivityofsecondaryschoolsinremoteandruralareas;•Connectivitysubsidyto45sitesforthepoliceinruralandremoteareas;and•Connectivityofsomeprivateinstitutionsandlocalbusinessoperatinginruralandremoteareas;DuetothehighcostofvSATconnectivityandavailabilityofafibrenetworkbackbone,since2012thetrendistoswitchfromvSATtofibreopticnetworks,whenevertheyareavailableintheruralareas.AsofJune2012alldistrictsinruralareas,immigrationservicesattheborderposts,police,militarybarracksandsomehighschoolsandalltele-centreshadalreadyswitchedtofibre(112outof180subsidisedsites).
Recentplanneddigitalinclusionprojectsinclude:•Connectivityofalluniversities,publicandprivate,usingRWEDNET(RwandaEducationNetwork•Connectivityofalltechnicalsecondaryschoolsandalltechnicalcolleges•Connectivityoforphanagesintwodistricts
8.16
RWanda
84
SSA USF STUDY
8.17
seneGal
seneGal year fund established: Pre fund: 2001 fund: 2007
UnderlyingFrameworkforFund
TelecommunicationLawin2000establishedthegeneralframework.In2001,theTelecommunicationsandPostsRegulatoryAgency(ARTP)wascreatedandaUniversalDevelopmentFund(UDF)wasputinplacetoincreasetelecomcoverageinremoteareas.In2004,thegovernmentbegantheliberalisationofthetelecommunicationsmarket.APresidentialDecreein2007(2007-593),establishedthetelecommunicationsUniversalServiceFundsanddefiningtherulesgoverningandthemechanismsforoperatingthefund.
OverallFundStructureandOperation
TheUniversalDevelopmentServiceFundforTelecommunications(FDSUT)isadministeredbytheRegulatoryAuthorityunderthesupervisionofaSteeringCommittee.
ContributionTypeandFrequency
AspecialtaxcalledContributiontotheDevelopmentofTelecommunicationsUniversalServiceandEnergySector(CODETE)setsthecontributionat3% of sales excludingtaxesfromallenergyandtelecomplayers.Thiscontributionissharedbetweentelecommunications(5%)andenergy(95%).Thefundalsoreceivescontributionsfromoperators’ licences (0.15% of their turnover).
ServicesCurrentlyAuthorisedUndertheExistingFramework
Affordabletelephoneserviceeveninthemostremoteareasofthecountry,directoryenquiryservices,telephonedirectories,freeofchargeroutingofcallstoemergencyservices,andtheinstallationofpublicphoneboothsthroughoutthecountry.Majoreffortswillbededicatedtoruralandlowincomelevelregions.
FundAllocationProcess
Openbidding
Governance SteeringCommittee(13members)chairedbyarepresentativeofthePresidentoftheRepublicselectaGeneralDirectorwhoisinchargeofthedaytodayactivitiesoftheFund.
LevelofActivity inactiveno financial reportingThereisnoprojectrelateddisbursementasof2010.Bridgingtheaccessgapinnetworksandtelecommunicationservices(telephoneandinternet)throughoutthenationalterritorywasthegoal.
85
SSA USF STUDY
8.18
sWaziland
sWaziland year fund established: 1990 legal establishment.2001: operational.
UnderlyingFrameworkforFund
•TheGovernmentestablishedaUniversalServiceObligationFundunderthelicenceawardedtoSwaziMTN.
•UniversalServiceObligationFundistobeestablishedbyElectronicCommunicationsBill2009.•Nopolicyinplace.
OverallFundStructureandOperation
UniversalServiceObligationFundisadministeredbytheUniversalServiceObligation(USO)CommitteeundertheRegulator,SwazilandPosts&TelecommunicationsCorporation(SPTC)/theSwazilandCommunicationsCommission(SCC)asanindependentregulatoryauthority.AccordingtotheElectronicCommunicationBill2009,thecommitteeisreferredtoas‘Commission’,responsiblefordevelopingimplementationstrategyofUSFinconsultationwiththeMinister.
ContributionTypeandFrequency
Contributionsfromageneral levy on all operators’ revenue.AspertheElectronicCommunicationsBill2009,CommissionshallcontributeallremainingunusedfundsorrevenuetotheUniversalService/AccessProgramme.
ServicesCurrentlyAuthorisedUndertheExistingFramework
AccordingtotheElectronicCommunicationBill2009,thefundistoprovideaffordabletelecomtothepublic,telephonedirectory,publicpayphonesbasedongeographicalenduserneeds,andspecificmeasuresfordisabledusersandlowincomeusers.
TheproceedsoftheoriginalFundweretobeutilisedbySwaziMTNfor:•Installationandmaintenanceofpayphones;•Implementing;•handsetsubsidies;and•Installationofbasestationsinfourremotelocationsinthecountry.
FundAllocationProcess
AccordingtoElectronicCommunicationBill2009,theCommissionshalldeterminethemostefficientandappropriateapproachforensuringtheimplementationofuniversalservice.
Governance MinistryofInformation,Communications,andTechnology
LevelofActivity inactiveno financial reportingus$6 millionhadbeendisbursedby2009.Sincethen,theFundhasbeeninactive.
86
SSA USF STUDY
8.19
tanzania
tanzania year fund established: 2009 legal establishment.2010: operational.
UnderlyingFrameworkforFund
PoliciesenvisagingaUniversalServiceFund:•NationalTelecommunicationsPolicyof1997.•TanzaniaDevelopmentvision2025andRuralDevelopmentStrategy2001.•NationalICTPolicyof2003.TheUniversalCommunicationsServiceAccessAct2006establishedtheguidelinesforthecreationoftheUniversalCommunicationsServiceAccessFund.UniversalCommunicationsServiceAccessFundRegulations,2009.
OverallFundStructureandOperation
None
ContributionTypeandFrequency
0.3% of yearly gross operating revenuefromallcommunicationsserviceoperators(includingISPs,postandcouriercompanies).Sofar,theFundhasnotbeensuccessfuloncollectionsfromoperators.OthersourcesfortheFund:•Governmentandtheregulator;•Parliamentaryallocation;and•Developmentpartnergrants:currentfundsincludeaWorldBankloan.
ServicesCurrentlyAuthorisedUndertheExistingFramework
Themandateunderthelawistoidentifytheruralandurbanunderservedareasanddesignateuniversalserviceareas.
FundAllocationProcess
CompetitiveTenderingandreverseaction.Allnetworkfacilityoperatorsareeligible.
Approvedprojectsneedtosatisfythattheywilladequatelydealwith:•Peoplewithdisability;•Peoplewithspecialneeds;•Deliveryofqualitycommunicationsservices;•Pricingofservicesintermsofaffordability;•Makingavailableandaccessiblecommunicationservicestoallpeople.
Governance n/a
LevelofActivity low activityno financial reportingTheGovernmentofTanzaniareceivedacreditfromtheInternationalDevelopmentAssociationtowardsthecostofTanzaniaCommunicationsInfrastructureande-GovernmentProjecttocovereligiblepaymentsundertheContractforRuralTelecommunicationsServicePilotProject2011:•EnablingEnvironment(US$14million)–policies•Connectivity(US$60million)-extensionofcoverageandaccesstoICTservicesinruralareas•e-GovernmentApplications(US$22million)•ProjectManagementSupport(US$4million)
TheFundisworkingonpilotprojectsfinancedbytheWorldBankfunds;itiscollectingandverifyingcoverageinformationandtheoperators’twoyearprojectionsinordertoidentifyunderservedareasthatwillbeusedforthepilotproject(2012).
InJanuary2012,UCAFannouncedabidtocovercertainremoteareas.ThetenderdidnotgoforwardasbiddersdeemedthemaximumsubsidyofUS$820,000inadequate(inadditiontoalackofgeo-marketingandtechnicalsurveythatwouldhavebeenneeded84)inviewofboththeinitialcapitalexpendituresandongoingoperatingexpensesrequiredtomaintainsitesthatmaynotbeeconomicallyviable,giventhelownumberofPOPsintheseareasandlackofaccessroads.
84. typically, if fund managers do not have the requisite in-house expertise to carry out such activities, they would be required to hire consultants to assist.
87
SSA USF STUDY
tOGO year fund established: 2001 legal establishment.2002: operational.
UnderlyingFrameworkforFund
•DecreeNo.2001-195/PRofSeptember162001describesthemechanismsforusingaspecialaccountfortheuniversalservice.
•Decree2001-007/PRof07February2001onfeespayablebyoperatorsandprovidersoftelecommunicationsservices.
•Replacedby:DecreeNo.2006-041/PRonfeespayablebyoperatorsandprovidersoftelecommunicationsservices.
OverallFundStructureandOperation
OperatorsareallowedtosubmittheirbidsaspartofprogrammesselectedbytheMinistryandcannegotiateagreementsregardingtherealisationoftheUS.ThenewvisionsetbytheGovernmentinitspolicystatementinMay2011intendstoinvolvestakeholdersinmanagementprocesses.
ContributionTypeandFrequency
2% of annual gross revenuesnetofinterconnectionpaymentsfromalloperators(whichcorrespondsto66.66%oftheannualchargesleviedonalloperators,whichare3%oftheirrevenues).
InthesectorialpolicydeclarationadoptedbytheGovernmenton18May2011,itisexpectedthatrelianceonotherfundingsourcesisnecessarytoacceleratetheachievementofuniversalservice.
ServicesCurrentlyAuthorisedUndertheExistingFramework
ThesumsallocatedtotheUniversalServiceshouldbeused:•fordevelopmentofruraltelephony(aminimumgrantisawardedbytheRegulatoryAuthorityto
thebidderfollowingatender);•tocoverlossesrelatedtotheimplementationofservicetocommunitiesnotyetservedbyan
operator(communitieswithlowdensity);and•FortheinstallationofpublictelephonesinareasconsideredtobedisadvantagedbytheMinister
afterconsultingtheRegulatoryAuthority.
FundAllocationProcess
Togoemploysa‘payorplayregime’.TheRegulatorrunsanannualsurveyinordertodetermine‘unservedareas’.ProjectsareawardedfollowingaproposalbyeligiblecandidatesandevaluationbyNRAbasedontheleastcostsubsidy.OperatorsprovidingUniversalServicecanbecompensatedfor:•Netcostoftheroutingofcallsbetweentelephonesubscribers;•Netcostofprovidingpayphonesnationwide.
Thefreeroutingofemergencycallsisnoteligibleforcompensation.Onlythecostsincurredfortheimplementationofanemergencycallcentre,ifaskedtodosobytheState,ischargedtotheUSaccount.TheMinisterforTelecommunicationsafterconsultingwiththeRegulatoryAuthoritycandecidetocompensateforotherspecialUSobligations.
Governance MinistryforTelecommunications.
LevelofActivity Moderate activityno financial reporting•Aspartofthe2008Programme,TogocelsignedanAgreementwiththeRegulatortoprovide
serviceinseveralunservedzonesforpublicandprivatevoiceandInternetaccessandservice.•ThreeprogrammesservingruralcommunitieshavebeenpublishedbytheMinistryof
Telecommunications.Thecompensationwasawardedtooperatorsagreedtocarryouttheseprograms.
•Spontaneousinvestmentsmadebyoperatorsforprojectseligibleundertheuniversalservicebetween2002and2005werecompensated.
•About190ruralcommunitieswerealreadycoveredunderspontaneousinvestmentsbytheoperatorsbetween2002and2005andunderthe2008and2009-2010programmes.
•183otherlocationsareplannedtobecoveredbasedonthreeagreementssignedbetweentheMinistryandtheoperatorson3May,2012underthe2011-2012programme.
•The2013programmewastobepublishedattheendof2012,takingintoaccounttheareasremaininguncoveredaftertheachievementsof2012.however,asofApril2013,thisreporthasnotyetbeenpublished.however,theARTPdidpublishatwopagesynthesisoftheImplementationoftheUniversalServicePlan,mentioningtheexpansionofservicestoruralcommunitiesandunder-servicedareasbutwithnospecificforecastortargets.
8.20
tOGO
88
SSA USF STUDY
8.21
uGanda
uGanda year fund established: 1997. 2001: legal establishment.2003: operational.
UnderlyingFrameworkforFund
•The1997UgandaCommunicationsAct.•RuralCommunicationsDevelopmentFund(RCDF)establishedundertheCommunications
(EstablishmentandManagementoftheRuralCommunicationsDevelopmentFund)Instrument,2002.
•The2005Communications(UniversalService)RegulationsoutlineacomprehensiveuniversalservicepolicyforUganda.
•In2002,theUCCadoptedaRCDFManualofOperatingProcedurestoguidehowtheBoardshouldmanageandadministerthefund.
OverallFundStructureandOperation
RuralCommunicationsDevelopmentFundisaninternalunitofUCCmanagedbytheManageroftheRCDF,appointedbytheUCC.ABoardappointedbyandreportingtotheUCCisresponsiblefortheexecutionofthestrategyforRCDF.
ContributionTypeandFrequency
1% of gross annual revenue,netofinterconnectionpayments,fromalloperators,includingthepostalservicecouriersandISPs.TheRCDFmayalsoreceivefinancingfromtheUgandaParliament,aswellasdonationsandgrantsfromdevelopmentpartners,andgiftsandloans.
Accordingtothe2005Regulations,UCCshouldestablishamechanismforsharingthenetcostsofsupportingtheuniversalserviceobligation(i.e.,differencebetweenthenetcostforanoperatorofoperatingwiththeuniversalserviceobligationandoperatingwithouttheuniversalserviceobligation)suchthattheuniversalserviceobligationdoesnotrepresentanunfairburden.
ServicesCurrentlyAuthorisedUndertheExistingFramework
RuralCommunicationsCoverageandInternetServices.Fundsareavailableforareaswhereserviceprovisionisnotfeasibleorunlikelytobeprovidedbytheoperatorsinthenext1-2yearswithoutsubsidy.Theuniversalserviceobligationsinclude:•Emergencyandfreeservices•Operatorassistanceanddirectoryenquiryservices•Servicesforpeoplewithdisabilities•Basicpostalservices;•ReasonablelevelsofaccesstopayphonesforallUgandansonanequitablebasis
FundAllocationProcess
Operatorscanaccessthefundthroughcompetitivepublicopenbiddingwhenarequestforabidisissued–usuallybasedonleastsubsidyrequested.UCCalsoentersintoPublic/PrivatePartnershipstoimplementselectedprojects.
Governance BoardoftheRCDF:consistsofrepresentativesoftheUCC,theUgandaPostalsector,UgandaConsumerProtectionAssociation,UgandaInstitutionofProfessionalEngineers,theUgandaInstituteofBankers,andtheMinistryofICT.
LevelofActivity High activityfinancial reportingFundshavebeenavailableforareaswhereserviceprovisionisnotfeasibleorunlikelytobeprovidedbytheoperatorsinthenext1-2yearswithoutsubsidy.154underservedsubcountiesofUgandahavebeenidentifiedanddividedinto3universalaccessareas.Between2003and2009,thefocusofRCDFprojectswasonensuringaccesstoICTservicesfortheunderservedareas.Subsequently,theRCDFprojectfocusshiftedtoensuringusageofICTservices.
Approximately5,482projectshavebeenaccomplishedbytheendof2010/11:•106Internetcafes•175healthICTfacilities•78ICTtrainingcentres•76InternetPOP•13Multi-PurposeCommunityTele-centres(MCTs)•45PostalTele-centres•708SchoolICTLabs•78Webportals•4,099Publicpayphones•90GSMsites•6Contentdevelopment•2Localgovernance•6Uniqueprojects
89
SSA USF STUDY
zaMbia year fund established: 1996-2009 establishment.2009 operational.
UnderlyingFrameworkforFund
•ICTAct2009,Section70•Nosecondarylegislationenactedyet•DraftUniversalAccessPolicy2009•Previously,theTelecommunicationsActof1994addressedtheconceptofuniversalaccess
totelecommunicationsservicesbymandatingtheCommunicationsAuthoritytotakeallreasonablestepstoextendtheprovisionoftelecommunicationsservicesthroughoutallruralandurbanareasofZambia,includingemergencyservice,publiccallboxservices,anddirectoryinformationservices.howevernosecondarylegislationwasenactedtosupportmanagementandadministrationoftheFund.
OverallFundStructureandOperation
•OriginallyundertheRegulatorCommunicationsAuthorityofZambia(CAZ),nowcalledtheZambiaInformationandCommunicationsTechnologyAuthority(ZICTA).
•ICTAct2009establishesanIndependentAgencyforUSF.•TheFundshallbemanagedandadministeredbyaFundManagerappointedbyZICTA.•TheFundManagershalleachyearpublishdetailsoftheactivities,thecontributionsto,and
allocationsfromtheFundwithinthreemonthsattheendofthefinancialyear.
ContributionTypeandFrequency
•Priorto2009,CAZwasraisingmoneyfortheFund(BoardResolution)throughannuallicencefeesremittancefromalloperators(holdersofIndividualNetworkandServiceLicencesandholdersofClassNetworkandServiceLicences).
•OperatorswouldpayRegulatoryFees:individual network licence [2%] and individual service licence [3%] on annual Gross turnover (less interconnect and vat).
•Since1998CAZhasbeenretaining 10% of its revenue from the annual licensing fee aspartofUniversalServiceDevelopmentFund.
•InFebruary2009ZICTAcreatedaseparateBankAccountfortheuniversalaccessfunds.•PolicyandRegulationsonceinplacewilldeterminebreakdownfromRegulatoryfeestobeallocated
touniversalaccessfundpool.•CurrentpoolofuniversalaccessfundsareallocatedfromRegulatoryfeesbydecreeoftheZICTA
Board.Othersources:•AnymoniesappropriatedbyActofParliamentforthepurposesoftheFund.•AnyothermoniestowhichtheFundmaybelawfullyentitledmayalsobeused.
ServicesCurrentlyAuthorisedUndertheExistingFramework
Mainobjectivesofuniversalaccess:•PromoteaccessibilitytoICTfacilitiesandservicetoallresidentsinZambia•PromoteaffordabilityofICTservicestoallcitizensintermsofpricing•PromoteavailabilityofICTfacilitiesandservicesnationwide
Theoverallobjectiveofthe2009ICTActistopromotethewidespreadavailabilityandusageofelectroniccommunicationsnetworksandservicesthroughfundingtobeprovidedforbasicservicestounservedorunderservedpopulationsegments:•Ruralconnectivity•Roadaccessibility•Renewableenergy/solarprojects•Ruralelectrification•Payphonerollouts
FundAllocationProcess
•Allocationprocessnotyetdetermined.•TenderbidandFunddirectfinancingthroughpurchaseofICTequipmentforprojects.
Governance TheMinistershallcauseanannualstatementoftheincomeandexpenditureoftheFundtobepreparedandlaidbeforetheNationalAssembly.
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LevelofActivity inactiveno financial reportingFundnotactiveyet,thoughanumberofprojectshavebeenimplementedbyCAZandZICTAundertheguiseofuniversalaccess.FundshavebeenallocatedinthepastatZICTA’sdiscretion.FirstdisbursementtoLinkNetdonebytheRegulator.US$65,000hasbeendisbursedin2009-ZMK1Bwasgiventofinancethreeruralmultipurposetele-centres.ProjectsimplementedbyZICTAhasincluded:•Theplannedconstructionofover200CommunicationTowersinruralandunservedareasof
Zambia.(Thishasnotbeendoneandthetenderwascancelledinpreferenceforacollaborativeapproachwithoperators.Forexample,Airtelhassincedeployed174ruralsites.ZICTAhassupportedthisthroughleaseacquisitionsandpaymentofratesandrentasapplicable.);
•EstablishmentofMulti-purposeCommunityTele-centresinover15selectedareasinthecountry;•ProvidinglastmileOpticFibreconnectiontotheCopperbeltUniversity,UniversityofZambiaand
MulungushiUniversityundertheZambiaResearchandEducationNetwork(ZAMREN).ZICTAiscurrentlyfocusingonthefollowingprojects:
•Multi-purposeCommunityTele-centres(MCTs)toprovideaccesstobasicICTsandtelecommunicationsserviceinvariousruraloutpostsinZambia;
•GSMservicesincludingfundingnetworkexpansiontoidentifiedruralareasofeachoperator.TheAuthorityisexpectedtofundsharableinfrastructuresuchastowersandsiteenergy.(Thishasnottakenoff)
•PoPstoextendInternetserviceprovisioninruralareas.(Thishasnottakenoff);and•Computerlabsinschools.
In2011,ZICTAsetasideZMK59billion(overUS$10million)fromtheUniversalAccessFundsfortheinstallationofcommunicationtowersthroughoutZambiathatwillalsobeusedtoconnectschools.ZICTAhasnotinvitedsubmissionsafterMarch2011.however,Airtel,forexample,iscurrentlyaccessingfundsthroughanadhocarrangement-the350UniversalAccessrolloutproject.
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ziMbabWe year fund established: 2001
UnderlyingFrameworkforFund
•PostalandTelecommunicationsActof2000providedforthesettingupoftheUniversalServiceFund.
•PolicyonUniversalService2001.•Regulationsof2001,requiredoperatorstomakeacontributiontowardstheUniversalService
Fund,asapercentageoftheirGrossTurnover.•PostalandTelecommunications(UniversalServiceFund)Regulations,2005.
OverallFundStructureandOperation
UniversalServiceFund(USF)asaninternalunitandaccountattheRegulator,thePostalandTelecommunicationsRegulatoryAuthorityofZimbabwe(Potraz),ismanagedbytheBoardofTrusteesofFundaspartoftheRegulatorandDeputyDirectorGeneralofNRA.
ContributionTypeandFrequency
2% of Gross annual Revenues fromalloperators.PotrazcancontributethroughmoneyappropriatedbyanactofParliamentandsurplusfundsattheendoftheregulator’sfinancialyear.
ServicesCurrentlyAuthorisedUndertheExistingFramework
In2001,UniversalServiceObligationswereimposedoneachOperator:•Rollouttargetsinunder-servicedareas;•Provisionofpublicpayphones;•Provisionofaccesstopublicemergencycallserviceanddirectoryinformationservice;•OperatorstoprovideservicesthroughoutthecountryincludingruralareasandatCommunity
Centresinunder-servicedareas.•Fundtofinanceprovisionofservicesinremoteareas.
FundAllocationProcess
Publicbiddingprocess.
Governance BoardofNRA.
LevelofActivity low activityno financial reportingTargetsnotachievedduetoeconomicandpoliticalsituation.MinistryofFinancedecidedin2010touseunusedfundsfor:•Fibreopticbackbone:•Extensionofcellulartelecommunicationservicesinruralareas;•ImprovingaccesstoICTinunder-servicedareasandcommunitiesaswellasschoolsinbothrural
andurbanareas;and•E-GovernmentIn2011,Potrazissuedabidtoinstallpassivetelecommunicationinfrastructureindesignatedruralareas.Firstinvestmentsin8provincialcitiesfortheremotenetworkcoveragestartedin2011.
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• General • Africa’sICTInfrastructure,BuildingontheMobile
Revolution,MarkD.J.Williams,RebeccaMayer,andMichaelMinges,TheInternationalBankforReconstructionandDevelopment/TheWorldBank,WashingtonD.C.,2011
• InsightstotheAfricantelecommarket2011:Analysis,forecastsandcommentary,byTelecomsMarketResearch.com,inassociationwithBuddecomm,August2011
• IstheUniversalAccessFundinAfricaCreatinganEnablingEnvironmentforICTInfrastructureInvestmentinRuralandPerceivedUneconomicAreas?,EnricoCalandro,http://ssrn.com/abstract=1724465
• ReportonUniversalAccessandServiceFundsintheSub-SaharanAfricanRegion,ITU,EdgardoSepulveda,April2010
• ReportOnUtilisationandManagementofUniversalAccess/ServiceFunds,AssociationofSouthernAfrica,Gaborone,Botswana,2009
• RuralBroadband,CTO,CRCAfricaForum,Tanzania,August,2011
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• AUSAFA: • OfficialEventReport,TheInauguralMeetingof
theAfricanUniversalServiceandAccessFund(AUSAFA),InmarsatConferenceCentre,LondonUK,10December2008
• ConstitutionoftheAfricanUniversalServiceandAccessFundAssociation,August26,2008
• ECOWAS • ECOWASSupplementaryActA/SA.6/01/07on
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LegalRegimeApplicabletoNetworkOperatorsandServiceProviders(2007).
• BurkinaFaso: • Autoritéderégulationdecommunications
électroniquedeBurkinaFaso,www.arce.bf• Côted’Ivoire: • AgencedestélécommunicationsdeCôted’Ivoire
(ATCI):http://www.atci.ci• DominicanRepublicofCongo: • AutoritédeRégulationdelaPosteetdes
TélécommunicationsduCongo(ARPTC):http://www.arptc.cd
• Gabon: • AgencedeRégulationdesTélécommunicationsde
Gabon(ARTEL):http://www.artel.ga• Ghana: • NationalCommunicationsAuthority(NCA):
http://www.nca.org.gh • GIFEC:http://gifec.gov.gh • UNDP,www.undp-gha.org• Lesotho: • LesothoTelecommunicationsAuthority:
http://www.lta.org.ls• Madagascar: • OfficeMalagasyd’EtudesetdeRégulationdes
Télécommunications(OMERT):http://www.omert.mg
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Authority(ICTA):http://www.icta.mu• Morocco: • AgenceNationaledeRéglementationdes
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paper-Morocco.pdf • http://www.internetworldstats.com/af/ma.htm• Mozambique: • InstitutoNacionaldasComunicaçõesde
Moçambique(INCM),http://www.incm.gov.mz • MinisterialDiploma79/2007dated4July2007on
theannualcontributiontobepaidbythetelecomoperatorstotheUniversalServiceAccessFund
• MozambiqueCountryReport,FranciscoGiroth,InstitutoNacionaldasComunicaçõesdeMoçambique,ITURegionalWorkshoponICTAccessibilityforPersonswithDisabilitiesfortheAfricaRegion,Lusaka(Zambia),15and16July2008,http://www.itu.int/ITUD/sis/PwDs/Seminars/Zambia/Documents/Presentations/025-Giroth%20Francisco-E.pdf
• http://www.africantelecomsnews.com/resources/AfricaOpp_Morocco.shtml
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us/en/documents/white-papers/usf-support-ictbroadband-programs-paper.pdf
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• http://mybroadband.co.za/news/business/12023-mozambique-s-tmo.html
• vodacomMozambiquewebsite,http://www.vodacom.com/av_wwa_where.php
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http://www.arm-niger.org• Nigeria: • NigerianCommunicationsCommission(NCC):
http://www.ncc.gov.ng • UniversalServiceProvisionFund(USPF):
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Regulators.aspx# • http://www.africantelecomsnews.com/resources/
AfricaOpp_Nigeria.shtml • http://thenextweb.com/africa/2011/08/08/getting-
the-next-50-million-nigerians-on-broadband/• Rwanda: • RwandaUtilitiesRegulatoryAgency(RURA):
http://www.rura.gov.rw• SouthAfrica: • IndependentCommunicationsAuthorityofSouth
Africa(ICASA):http://www.icasa.org.za • UniversalServiceandAccessAgencyofSouth
Africa(USAASA):http://www.usaasa.org.za • ElectronicCommunicationsAct,No.36of2005 • Regulations:PrescribedAnnualContributions
ofLicencestotheUniversalServiceandAccessFund,ICASA,February2011
• StatusUpdateoftheUniversalServiceandAccessFundOperationalActivities–March2014
• http://www.africantelecomsnews.com/resources/AfricaOpp_South_Africa.shtml
• http://mybroadband.co.za/news/broadband/39777-broadband-penetration-and-gdp-sa-stillsucks.html
• http://www.mbendi.com/indy/cotl/tlcm/af/sa/p0030.htm• Tanzania: • TanzaniaCommunicationsRegulatoryAuthority
(TCRA):http://www.tcra.go.tz• Togo: • AutoritédeRéglementationdesSecteursde
PostesetTélécommunications(ART&P):http://www.artp.tg
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• RuralCommunicationsDevelopmentFund(RCDF)
Supplement,UCCconnectsMpondweborderposttoICThighway,October12,2011
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• Zambia: • ZambiaInformation&Communications
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InfrastructuresandServicesPolicy,Paris,28-29March2012
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