Market News

Cost of making calls to regional countries rise

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A woman makes a call on her mobile phone. PHOTO | CYRIL NDEGEYA | NMG

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Summary

  • Official data shows the cost of calls to Burundi grew the highest to Sh71.67 per minute from Sh66.67 in 2020 followed by calls to Ethiopia and South Africa.
  • The rise in mobile call tariffs added to the pain of Kenyans faced with an increase in the cost of basic commodities like food, electricity, and fuel.
  • The average cost of calls to Tanzania, South Africa, and South Sudan is the highest in four years at Sh50, Sh33.33, and Sh10.67 per minute respectively.

The average cost of making calls from Kenya to other African countries increased by up to Sh5 per minute last year, making it more expensive to conduct cross-border business and keep in touch.

Official data shows the cost of calls to Burundi grew the highest to Sh71.67 per minute from Sh66.67 in 2020 followed by calls to Ethiopia and South Africa that increased by Sh3 to Sh36.67 and Sh33.33 per minute respectively.

The rise in mobile call tariffs added to the pain of Kenyans faced with an increase in the cost of basic commodities like food, electricity, and fuel.

“The average price of calls from a mobile phone for African countries increased with Burundi having the highest increment of Sh5 to stand at Sh71.67 in 2021,” Kenya National Bureau of Statistics says in the Economic Survey 2022.

The average cost of calls to Tanzania, South Africa, and South Sudan is the highest in four years at Sh50, Sh33.33, and Sh10.67 per minute respectively.

Last year’s call rates marked the first rise for outgoing calls to Uganda and Ethiopia since 2017, highlighting the effect of increased excise tax on mobile calls and data to 15 percent from 10 percent.

The increase came when telecoms firms reviewed their call tariffs to mirror the rise in excise duty on airtime and data.

Safaricom, Airtel, and Telkom Kenya increased call rates in July last year to reflect the increment of excise duty on airtime and data from 15 percent to 20 percent through the Finance Act, 2020.

MPs increased excise duty on airtime and data from 15 percent to 20 percent in a move aimed at raising at least Sh8 billion from the telcos.

The telcos increased calling tariffs by up to Sh2.78 per minute last year adding to the pain of callers already hit with high prices of the basic commodities.

The increased cost of telecommunications is part of an overall rise in the price of many goods and services, piling pressure on households and businesses. The annual inflation as measured by the Consumer Price Index (CPI) increased from 5.4 percent in 2020 to 6.1 percent in 2021.

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