…to drive technology investment and economic growth
by Eugene Davis
Selorm Adadevoh, the departing CEO of MTN Ghana, has emphasized the necessity of favorable tax policies to stimulate increased investment in technology and telecommunications.
He urged policymakers to reevaluate existing tax frameworks to effectively bolster technological advancement and drive economic growth.
Speaking with a cross-section of corporate executives, stakeholders and journalists during an engagement to mark five years, nine months since he assumed the role at MTN House in Accra, he underscored the complexity of creating an investment-friendly environment, particularly in sectors like telecommunications and technology.
Highlighting the challenges posed by multiple layers of taxes and stressing the importance of streamlining processes, such as customs duties, to facilitate infrastructure investment.
He suggested that countries with efficient tax systems will lead in infrastructure and technology advancement, thereby reaping the benefits of economic growth and competitiveness. Additionally, he called for a reassessment of current tax systems to better align with the potential of technology as a driver of economic growth.
“Markets that do a good job at this, will take a leadership position and will see the benefit from the infrastructure and technology advancement that some of these things allow.
There is an opportunity for us to decide if technology is an instrument for economic growth – then the tax system today is not encouraging the level of investments that could be had if we made certain types of decisions around our tax system.”
Developing countries apply numerous sector-specific taxes to telecommunications, whose buoyant revenues and formal enterprises provide a convenient “tax handle”
According to a GSMA 2015 report, Mobile operators are subject to several sector-specific taxes, in addition to corporate tax and the National Fiscal Stabilisation Levy (NFSL).
Many of these taxes reduce incentives and resources for infrastructure investment; examples include licensing fees and the contribution towards the Ghana Investment Fund for Electronic Communications, each of which amounts to 1% of total revenues.
Another potential barrier to investment comes from customs duties on imported network equipment; base stations, for example, are subject to import duties of 10%.
A 2021 Total Tax Contribution (TTC) Report by the Telecoms Chamber revealed that the total value of taxes, fees, and levies paid by and collected by the telecommunications industry for the government has risen significantly from GH¢ 3.6 billion in 2020 to GH¢ 4.3 billion in 2021.
This represented an increase of over 18% in the taxes paid by the industry, along with other remittances made, to the government and other statutory bodies.
The mobile sector in Ghana has enabled 12.6 million Ghanaians, about 50% of the population,
to access the benefits of mobile communications.
Further, Mr. Adadevoh also noted that the narrative around Artificial Intelligence (AI) in Africa has mainly been its negative impact on jobs but it is time African countries took a critical look at how they can benefit from AI instead of focusing on the downside.
He remains the longest-serving CEO in the history of MTN.
The meeting was themed: Five Years of Impact; Celebrating Leadership, and Digital Transformation for Progress in Ghana and it was held to honor his outstanding service to the company and also pay homage to him, as he leaves to take up the new Chief Commercial Officer (CCO) of the Group, effective April 1, 2024.
Selorm Adadevoh joined the company in 2018 as CEO of MTN Ghana and has recorded impressive feats since he assumed his role. In February 2023, he won the MTN CEO of the Year award at the MTN Leadership Gathering conference in Johannesburg, South Africa. Besides, MTN Ghana won the Best Environmental Sustainable Governance (ESG) Award and the Best Rural Telephony Project.
Adadevoh’s previously held positions show he has been an active contributor to the digital industry. He has over 20 years of experience in telecoms and financial services, serving many African countries.
Before he joined MTN Ghana as CEO, he held key roles with industry firms like Digicel Group and Millicom/Tigo, a mobile telecommunications service provider. Positions he has held include CEO, COO, global director for mobile fintech services, and head of product.