Mobile Telecommunications Network (MTN) Group has been forced to exit its operations in the Middle East due to concerns raised as a result of the United States sanctions on Iran. MTN has in the last two years faced series of litigations in the United States over claims that it paid terrorists in Afghanistan and Iran for protection of its equipment, a development the United States sees as counterproductive to its security interests in the region. The telecoms firm said that after careful deliberations on its operations in the region, it has decided to pull out and concentrate on its African markets resolving to simplify its portfolio and exit its Middle Eastern assets in an orderly fashion.
The group will scrap its interim dividend under a blueprint to navigate the coronavirus pandemic – which posed an unprecedented socio and macroeconomic challenge rendering trading conditions difficult. CEO, Rob Shuter, mentioned strong results during the COVID-19 period in his statement, singling out great performances in Nigeria, Ghana and homebase South Africa.
The company which was founded in 1994, lists operations in Sudan, Syria, Yemen and – as well as Iran and Afghanistan in its Middle East file. The first step towards its new entrepreneurial direction is to sell its 75% stake in MTN Syria. A key undertaking about which the company is already in advanced talks.
Among reasons for divesting from the region, he cited losing money on falling regional currencies, the Middle East’s volatile geopolitics, and problems with Western sanctions, though he did not mention Iran specifically. U.S. sanctions have made it harder to repatriate cash from its Iran joint venture. MTN’s entry into the region has been marred by allegations, which it has denied, that it used bribes to win a 15-year operating licence in Iran and also that it aided militant groups in Afghanistan. The company’s Middle East assets contributed less than 4% to group earnings before interest, taxes, depreciation, and amortization in the first half ended June 30.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry