Taxes threaten mobile growth: GSMA
High levels of government taxation and new regulations threatens to limit the growth of mobile services across the sub-Sahara Africa region, according to a report by the GSM Association.
The mobile body reported on Tuesday (13 November 2012) that sub-Saharan Africa is the fastest-growing mobile market in the world, having grown at an average annual growth rate of 44% since 2000.
“Mobile connections have leapt to 475 million, compared to just 12.3 million fixed line connections, representing the highest proportion of mobile versus fixed line connections in the world,” the GSMA said.
According to the GSMA, the rapid pace of mobile adoption in sub-Sahara Africa has delivered huge economic benefits for the region.
The mobile market has directly contributed $32 billion to the regional economy, representing 4.4% of GDP.
Taxing affair
However, the GSMA believes that high levels of government taxation and new regulation threaten to limit the growth of mobile services across the region.
“Africa has the highest taxation, as a proportion of the cost of mobile ownership, amongst any developing regions worldwide, with taxes on handset and mobile devices much higher than elsewhere,” the GSMA said.
“There is also a worrying trend of new taxes being introduced on essential mobile services.”
Among regulatory hangups, approvals for tower and fibre deployment have been identified as the single biggest obstacle to investment by the mobile community in sub-Saharan Africa.
As capacity increases, demand increases, and deployments of fibre and tower networks are urgently required to cope with substantial traffic growth.
“Complex and uncoordinated national and local regulations and approval processes – especially with regards to rights of way – could be simplified to aid this process,” the GSMA said.
“Tackling stifling regulation, addressing high taxation and implementing a harmonised approach to future spectrum allocation will further boost the success story of mobile across the continent,” it said.
Related articles
SA’s real mobile penetration revealed
Mobile Internet trends in emerging markets
App stores gaining ground in emerging markets
SA’s slide towards the wrong side of the digital divide
F&S alludes to mobile data war
Loading ...