We must not Scare MTN Away from Nigeria

Adebayo Shittu. Picture taken by REUTERS/PAUL CARSTEN
during the interview

The minister of communications of the Federal republic of Nigeria, Adebayo Shittu said, Nigeria must not scare away MTN, as legislators investigates investigate claims of illegal money transfers three months after the Africa’s biggest telecoms group was fined more than $1bn.

The comments made by the minister are the government’s first statement on the newest MTN investigation, signifying that the government does not want to see the South
African group penalised unduly in Nigeria, its biggest market if the latest allegations prove true.

Shittu said on Friday that "Nobody will say that MTN is not important to Nigeria — we must encourage them, we must not scare them away from Nigeria."

MTN, which is unarguably the largest mobile phone group in Nigeria, threatened to pull out of the Nigeria last year over the issue of unregistered SIM cards before the government settled to reduce a fine on the issue by almost 70% to $1bn.

MTN Logo

The company is currently facing another hefty penalty if an investigation by Nigeria’s upper house of parliament finds MTN Group guilty on illegally transferred of $13.9bn from Nigeria starting from 2006 to 2016.

MTN responded by saying it did not break Nigeria’s currency transfer rules.

Shittu also said "The presumption is that they are innocent, and we pray they remain innocent, and they must stay."

Shittu’s remarks looks like those he made when MTN was firstly fined $5.2bn in 2015 (equivalent to more than two years of its Nigerian profits) for failing to disconnect unregistered SIM cards. The fine was reduced last June to 330-billion naira ($1.1bn).

Nigeria can accounts for a third of MTN’s revenue. The root of the allegation of illegal money transfers is that MTN did not obtain certificates declaring it had invested foreign currency in Nigeria within a 24-hour deadline stipulated in a 1995 law, and so the transfer of such returns on those investments was illegal.

"They have a right to repatriate their profits as long as it is legitimately done," Shittu said. At any time MTN is suspected of breaking the law, it would be investigated, but allegations "against them must be established beyond reasonable doubt. Everyone who is in business will have ups and downs. You don’t throw away the baby with the bathwater."

Shittu said the investigation was an issue for financial regulators and did not fall within his "constitutional responsibility". The government, however, can influence the size of the penalty, as with the SIM card issue.

Shittu also said Nigeria is currently planning of building and launching two new satellites using a $550m loan from the Export-Import Bank of China, which would shelter 85% of the cost. Nigeria would finance the other 15%. Shittu encouraged domestic and foreign investors to take part in funding.