MTN Group President and CEO Ralph Mupita has called on African governments to stop overtaxing technology companies and instead offer incentives that will attract the massive private investment needed to transform the continent’s digital landscape.
Speaking during the opening keynote at Mobile World Congress Kigali 2025, Mupita told GSMA Director General Vivek Badrinath that regulatory frameworks across the continent were designed for the voice era when networks required minimal capital investment, but the industry has now migrated to data services that demand heavy infrastructure spending.
He argued that while Africa struggles to catch up with global digitalization standards, regulators and governments continue to impose excessive taxes and fees on the technology sector, creating a significant barrier to attracting the level of investment required for meaningful digital transformation.
According to data presented at the conference, Africa faces a 64% usage gap and 9% coverage gap, which the International Telecommunication Union estimates will require at least $900 billion in infrastructure, innovation, and inclusion investments to bridge. The main obstacles to expanding coverage include inadequate infrastructure, particularly reliable power supply, while the massive usage gap stems primarily from unaffordable devices and lack of digital skills among potential users.
Mupita stated that mobile network operators do not meet the cost of capital for the infrastructure being provided, calling for price floors in markets to support and protect investments. He urged policymakers to start with a clean sheet of paper and design frameworks suited for digital societies rather than clinging to legacy systems built around voice communications.
The MTN chief suggested regulators should begin thinking about incentivizing industry players through tax rebates, then hold them accountable to obligations for investing in necessary infrastructure and driving inclusion through affordable devices and digital skills programs. This approach, he believes, could effectively address both coverage and usage gaps across the continent.
He added that high spectrum costs and heavy taxation continue to undermine investment, urging policymakers to rethink pricing and competition models. Beyond tax relief, Mupita emphasized the critical need for reliable and affordable energy to help industry players thrive, particularly in supporting artificial intelligence applications that have become essential to digital transformation efforts.
Orange Middle East and Africa CEO Yasser Shaker echoed these regulatory concerns during the same keynote, stressing the need for balanced competition and sustained innovation. He noted that telecommunications companies now compete not only against each other but also against fintech firms, over the top content providers, and satellite operators, making regulatory clarity crucial for continued investment.
The debate around government incentives for operators in exchange for infrastructure investment commitments has featured repeatedly in discussions about Africa’s digital future. However, it resurfaces consistently because African governments maintain high tax burdens on the technology industry despite these ongoing conversations.
Ghana provides a stark illustration of the tax burden facing mobile operators. The total tax imposed on mobile network operators in the country reaches 39%, costs that ultimately get passed to consumers through elevated data prices. This creates a vicious cycle where high costs suppress usage, which in turn discourages the very investments needed to improve services and reduce prices.
While some operators like MTN, Vodafone, and Airtel offer affordable smartphones priced between $5 and $17 in select markets, they also run buy now pay later schemes in other jurisdictions where customers end up paying up to three times the actual cost of handsets through payment plans. At the conference, GSMA announced a new initiative alongside six of Africa’s largest operators, including Airtel, Axian, Ethio Telecom, MTN, Orange, and Vodacom, recognizing that device cost remains a major barrier to internet adoption.
Speaking on connectivity across the continent, Mupita noted that out of Africa’s 300 million mobile subscribers, only 130 million currently use 4G networks, underscoring a significant gap between coverage availability and actual digital participation. This disparity stems from persistent barriers including high costs for data and devices, limited access to relevant local content, and the need for progressive regulatory reforms.
The keynote discussion also addressed Africa’s language gap in technology, with the GSMA unveiling a continent wide initiative to develop AI language models in Africa, by Africa, for Africa. The coalition includes major operators and research groups working to ensure Africa’s languages, cultures, and knowledge gain proper representation in global AI systems.
Both GSMA and ITU officials expressed their belief that through collaboration between governments and operators, as well as cooperation among industry players themselves, genuine inclusion can be achieved and the substantial coverage and usage gaps can be bridged. However, this collaboration requires fundamental shifts in how governments approach taxation and regulation of the technology sector.
The call for regulatory reform comes as unique mobile subscribers across Africa are projected to exceed 700 million by 2030, presenting both enormous opportunities and significant infrastructure challenges. Whether African governments will heed these calls and adjust their approach to technology sector taxation remains to be seen, but industry leaders made clear at MWC Kigali that current policies are insufficient to unlock the continent’s digital potential.
As President Paul Kagame of Rwanda formally opened the three day event, the political importance African governments attach to digital infrastructure development was evident. Yet translating that political commitment into concrete policy changes that reduce tax burdens and create investment friendly environments will be the real test of whether Africa can accelerate its digital transformation in the coming years.
Source: newsghana.com.gh
