Telecoms poised to retain growth momentum

• CEOs’ most respected company awards predict a shift towards ICT window

Regional economies will continue to see a shift towards information based activity as the telecoms sector drives economic growth in the future, a survey of senior executives has found.

Results from the recently concluded East Africa CEO’s Most Respected Company Awards shows that the telecoms industry is poised to retain its high growth position as regional economies shift from agricultural to ICT based structures.

Analysts said executives in the East African Community overwhelmingly perceived companies in the telecommunications sector as positive growth drivers due to the increased prominence the sector is enjoying as a result of high uptake of its services and sector’s increasing relevance to national economies.

“The telecoms sector has in the last ten years revolutionised our economies, and the way people live and work. These firms are characterised by significant uptake of services in all segments of the economy, they enjoy large turnovers and have proven resilient in the current financial situation,” said Kuria Muchiru, a senior partner at PricewaterhouseCoopers (PwC).

The ICT sector emerged the most highly regarded industry among high level executives during the recently concluded awards ceremony, with regional mobile telephone firms scoring high approval ratings for their innovative strategies in steering the corporate ship through the global downturn.

Safaricom impressed the majority of the 178 chief executive officers who participated in the Survey, clinching the overall award for the third year running. Kenya Airways was placed second in the overall award followed by MTN.

Another telecoms giant Zain took home the country award for Tanzania edging out South African telecoms firm Vodacom which came second.

In the wake of the global financial crisis, regional telecoms firms have invested billions of shillings in new product development and service delivery.

“Moving forward, the battle will be on innovating new products and modifying existing ones as economic growth picks up” said Themba Khumalo the CEO at MTN Uganda.

Fibre optic connectivity is expected to be the game-changing platform that is not only expected to lower the cost of communication by up to 10 times but also improve the speed and quality of services.

PwC said that while in the past aspects such as exploiting opportunities in the global market and managing change featured prominently in the survey, winners this year featured firms that had shown resilience in surviving an economic slump that has depressed business performance across the world.

In PwC’s survey, regional CEOs picked quality of products and services, expansion into new markets and market leadership as the leading drivers of respect in that order.

Fighting for survival

These factors have informed the development of key business drivers that characterise the mobile firm sector, where companies launch an average eight new products annually.

In the wake of the credit crisis that is just starting to thaw, most East African companies have found themselves fighting for survival rather than racing to meet business targets.

PwC and the Nation Media Group co-sponsored the survey whose theme was ‘Rethinking and Reshaping the New Normal’

“The battlefront for business is quickly shifting to this region as the EAC market opens up,” said Nation Media’s chief executive Linus Gitahi.