World Bank doubts Camtel’ success with 3G

In a report dated November 2014 and excerpts revealed on 3rd December, 2014 by the Cameroonian weekly benchmarks, the World Bank has stated its reservations about the ability of the Cameroon Telecommunications (Camtel), the incumbent telecoms, to make profitable the 3G technology it intends to operate from 2015 through the mobile licence issued by the Cameroonian Government this year.

"The company failed to operate the CDMA technology (with the Ctphone in particular) which is equivalent to 3G technology", noted the Bretton Woods institution in its report. With this assumption, continued the World Bank, "award of 3G licensed to Camtel, probably without financial compensation because of the deterioration of the company's finances, seems exclusively political, knowing that Camtel does not appear to have the human resource base with the requisite skills to implement a network of such quality". This painting will hardly resist financial note "BBB" recently attributed to public telecoms operator by the Panafrican Rating Agency Bloomfield Investment.

They also noted that Camtel's finances are characterized by 'a financial fragile structure, of insufficient cash flow' and, above all, a 'chronic cash deficit born of a need for significant capital'. These highlight the flexibility and financial dependency of the company.

From this point of view, the financial statements of 31st December, 2013 for Camtel revealed a deficit of 4.9 billion Cfa francs cash, abyssal debt estimated at 141.2 billion Cfa francs at the end of December 2013 (compared with 91.7 billion in 2012), despite a net profit of slightly more than 3 billion francs Cfa registered at the end of the year.

But more generally, analyzed the World Bank, Cameroon which aims to exploit 4 '3G' licences in 2015 (Nexttel, MTN, Orange and Camtel), could move from the status of "one of the rare African States not having 3G licence to one of the States to have the most. A situation that does not reassure the World Bank, which analysed it in this way: "with 4 '3G' licences, it is likely that the market of 20 million people is not sufficient to make four operators increase the necessary migration-related investments while having powerful 3G offers".

Well, because this 3G on the market of telecommunications in Cameroon from 2015, Bretton Woods institution suspects that, "it is likely that operators concentrated their investments in the same areas with high value and have forsaken the rest of the territory, thus reinforcing the divide digital intra-Cameroon.