The Kenyan government is scouting for a strategic investor to bail out Telkom Kenya, following the acquisition of the telco last year. The government is also considering spending Ksh 7.2 billion from national coffers to clear the telco’s debt.
Information, Communication, and the Digital Economy Cabinet Secretary Eliud Owalo said the government is taking these steps to reduce the risk of spying on critical government information.
“The government is concerned about the security of its communications infrastructure,” Owalo said. “We believe that by owning a majority stake in Telkom Kenya, we can better protect our national security.”
Telkom Kenya is still in the red even after the government bought back a 60% stake from Helios Investment Group. The telco’s financial problems are due to several factors, including declining revenue, rising costs, and competition from other mobile operators.
Broadcasting Principal Secretary Prof. Edward Kisiang’ani said the legal status of Telkom Kenya is still contestable as the transaction was not completed. This has forced American Towers Company to shut down critical infrastructure that is of national security nature.
Telkom Kenya owns 723 towers which were transferred to American Tower Corporation. The towers are used to transmit government communications, including those of the military and the police.
Owalo appealed to Parliament to relook at the privatization policy to prevent a reoccurrence of the same. Legislators were also concerned about rising cases of hacking and other forms of cybercrime.
Owalo said the cost of calls will from next month be lower when the mobile termination rate is further reduced. The mobile termination rate is the fee that one mobile operator charges another for terminating a call on its network.
The government’s decision to bail out Telkom Kenya has been met with mixed reactions. Some people have welcomed the move, saying that it is necessary to protect national security. Others have criticized the move, saying that it is a waste of taxpayer money.