Policy Foundation of the GhanaTelecom Industry

Abstract

Drawing on institutional theory, the paper aims at improving the understanding and explanation of the processes of reform of Ghana's telecom industry as well as the policy and governance initiatives that have contributed to shaping the industry today. The research question of the paper is concerned with how the developments of the policy and governance foundation have affected the development trends and structures of the telecom industry in Ghana. This involves a periodization of the different policy and governance initiatives. The paper identifies two major periods and their various levels of gover-nance, from the decentral era where management of the sector was vested in the traditional chiefs followed by the municipalities/districts to the centralization era where powers were moved to, first, the Works and Housing Department and later the Ministry of Communications and the regulatory agency in connection with the liberalization of the sector. Within the era of liberalization, the paper identifies three main policy directions: 1) A market liberalization period (1997-2007) where Westel Ltd. was introduced into the fixed line market and where Spacefon, Celltell and Mobitel all were introduced to the cellular telephony market; 2) an infrastructure expansion period starting at the beginning of 2008, where the overall policy was increasingly directed towards infrastructure development with infrastructure licensing of international tower companies; and 3) a new period having started recently from the beginning of 2011 and up to date, with policy initiatives being directed at consumer protection and projects such as mobile number portability and SIM card identification. The application of institutional theory provides the basis for an improved understanding of the sector reforms including the identification of poor performance of the GP&T, strong government manipulation without any opposition in parliament, weak workers' unions, and a general policy apathy as key endogenous factors affecting the reform process, while international bodies, donor communities and other external agreements constitute important exogenous factors.