Cellphone usage in Malawi expensive, says ITU

Mobile cellular phones in Malawi are most unaffordable to use in the world relative to incomes, with the services costing more than half people’s average incomes, expressed as gross national income (GNI) per head.

The International Telecommunications Union (ITU) Measuring the Information Society 2014 Report released last month indicates that the cost of using a cellphone in Malawi averaged about $12.67 (about K6 335) per month in 2013, about 56.29 percent of what an average person earns.

At such a cost, the ITU has ranked Malawi as the worst situation in the world out of 166 economies, a development which is influenced by the country’s poor income levels and the prohibitive cost of the services.

Relative to other economies in the region, Malawi in which consumers use over half their incomes, is far much outranked, with customers using about 30 percent on average of their incomes on cellular phones in Zimbabwe, 26 percent in Mozambique, 18 percent in Tanzania, 14 percent in Zambia and about five percent in Kenya while for Botswana the services cost less than two percent of people’s incomes.

The ITU report, however, tips economies in the region to borrow a leaf from Kenya and Ghana, which it says have implemented best practices in the sector.

“Kenya and Ghana have succeeded in bringing prices down through a pro-competitive approach. Further reductions in mobile-cellular prices could be achieved by combining regulatory actions to promote competition, such as fostering inter-operator competition,” reads the report in part.

In Malawi, a market which has three operators—Airtel Malawi, TNM and Acess—consumers have been complaining of high cellular phone tariffs, pointing fingers at unfair trade practices and uncompetitive behaviour while the operators have blamed the prohibitive tariffs on poor business environment, including inflation and infrastructure.

Earlier, Malawi Communications Regulatory Authority (Macra) deputy director of spectrum management Jonathan Pinifolo said the regulator would develop a framework for competition assessment, which would enable the watchdog to intervene in the market.

Macra also noted that because the regulator is an interface between operators and consumers, it is important that the regulator moves into market issues compared to an emphasis on technical areas.

Although relative to incomes, Malawi’s cellular phone services are most expensive in the world, the service is still cheaper in relation to other economies such as Mozambique, Zambia, Zimbabwe and South Africa.