Qatar firm opens up Myanmar mobile market with cheap SIM cards

Updated 02 August 2014

Qatar firm opens up Myanmar mobile market with cheap SIM cards

YANGON: Qatari telecoms firm Ooredoo has started selling low-cost SIM cards in Myanmar, opening up access to mobile services in one of the world’s last virtually untapped phone markets.
Less than 10 percent of the population are thought to have access to a telephone in Myanmar where the exorbitant cost of a SIM under former junta rule made mobile phones a luxury.
But last year the reformist government led by President Thein Sein awarded telecom licences to Ooredoo as well as Norway’s Telenor, part of a wider move to open up markets previously monopolized by state firms.
“This is history that we made here today,” said Ooredoo Myanmar CEO Ross Cormack at a press conference in Yangon, adding the firm was bringing the very latest technologies to the long-isolated nation.
The SIM card was officially launched for sale in the major cities of Yangon, Mandalay and Naypyidaw at a price of 1,500 kyat ($1.5), a fraction of the cost of ordinary cards in Myanmar which retail at about $200. Under junta rule, a SIM could go for more than $1,500.
Ooredoo billboards advertising traditionally-garbed women holding a parasol in one hand and a mobile in the other have plastered downtown Yangon streets for weeks, helping to build a buzz around the launch.
Several million SIM cards will be on sale from 6,500 dealers, according to Cormack, ahead of a wider rollout to cover 68 towns and cities, around and including the three hubs launched on Saturday, by mid-August.
But some shops were reported to have started selling advance stock as early as last week with cases of vendors demanding above the retail price and even selling out.
“I bought two SIM cards yesterday for 5,000 kyat each. The price is still very cheap if you compare it with what was previously available,” Khaing Moe, a university student, said.
Rival Telenor, which also plans to sell its SIM cards for 1,500 kyat, said it would launch in Myanmar in September.
“Healthy mobile competition in the mobile industry will benefit consumers in Myanmar and we are confident that Telenor will become the most affordable offering in the market,” firm spokeswoman Hanne Knudsen said.
Myanmar has generated huge international investor interest since wide-ranging reforms introduced under the current quasi-civilian government saw most Western sanctions lifted.
Actual investment has been tempered by nervousness over the regulatory framework.
But the telecoms tender process eventually won by Telenor and Ooredoo last June saw some 90 firms compete for the 15-year licences, the first to be awarded by Myanmar.
The two foreign firms will soon compete against each other and existing state-owned giant Myanmar Post and Telecommunication for a potentially lucrative pool of customers among the country’s estimated 60 million people.
The national company also started selling low-cost SIMs last year, but through a lottery system which is relatively small in scale, leaving many people to still rely on manned roadside stalls where they can use conventional telephones to keep in touch.
Alongside the opportunities of entering one of the world’s few remaining frontier mobile markets are the many challenges of reaching scattered rural communities in Myanmar.
Patchy power, poor road connections and regulatory issues such as land rights are among the problems companies face in building a mobile network.
The growing Buddhist nationalist movement in Myanmar has also posed a threat. In June, radical monks urged a boycott of Ooredoo because it hails from Qatar.

Embattled Turkey looks to US dollar swaps as virus costs bite

Updated 03 April 2020

Embattled Turkey looks to US dollar swaps as virus costs bite

  • Turkey looking for access to the US Federal Reserve’s dollar swap lines as the country’s economy struggles with the costs of the coronavirus pandemic
  • The outlook for the Turkish lira in coming months is grim, with the global stay at home campaign likely to undermine tourism revenues as well as export-based businesses

ANKARA: Turkish officials are believed to be negotiating with their American counterparts for secure access to the US Federal Reserve’s dollar swap lines as the country’s economy struggles with the costs of the coronavirus pandemic.

In March, as the contagion spread across the world, the US central bank established liquidity swap lines with the Bank of England, Bank of Japan and European Central Bank as well as their counterparts in Canada and Switzerland, before piping dollars into other central banks in Singapore, Australia, Mexico and Brazil.

However, no swap lines have been extended to Turkey whose budget deficit reached almost 5 percent of gross domestic product (GDP) last year.

“With the lira weaker than it has been since the 2018 spat with the US over the imprisonment of pastor Andrew Branson and with net foreign currency reserves almost depleted, the ability of Turkish central bank to sustain the currency is limited,” said Wolfango Piccoli, co-president of Teneo Intelligence in London.

Experts say that the outlook for the Turkish lira in coming months is grim, with the global “stay at home” campaign likely to undermine tourism revenues as well as export-based businesses in the country.

Tourism accounts for about 13 percent of Turkey’s $753 billion economy.

Following the introduction of quarantine restrictions, Turkey’s export volume dropped 3.9 percent on a yearly basis to $42.8 billion in the first three months of 2020, while last month the country’s exports narrowed by 17.8 percent compared with a year earlier, reaching $13.4 billion.

Piccoli said that Turkey’s hopes for a swap line with the Fed shows that Ankara remains reluctant to ask the International Monetary Fund (IMF) for assistance, mainly for political reasons.

However, other experts say that Turkey’s foreign reserves are depleted and Ankara may be forced to approach the IMF to survive the crisis.

So far, about 85 countries have applied to the IMF for emergency support. But borrowing money from the IMF was among the main criticisms directed by the ruling Justice and Development Party against its political rivals.

Meanwhile, Fitch Ratings on Friday joined other international ratings agencies by lowering its 2020 growth outlook for the Turkish economy from 3.9 percent to 0.8 percent, while raising its 2021 growth estimates from 4 percent to 4.5 percent.

The country’s economic outlook was also revised downwards by Moody’s, which said Turkey’s economy will be “hit hardest” among G20 economies, with a contraction in second- and third-quarter GDP of about 7 percent.

“As before, the Turkish government will enable the state banks to defend the lira, which will be increasingly difficult. The outlook for the lira, despite the current depreciated state, is more negative than positive,” Emre Deliveli, a Turkish economist, told Arab News.

Deliveli said that Turkey may ask for IMF help in July or August after its summer tourism revenues fall.

“But this option is valid only when it becomes obvious to the officials in charge of the economy and Treasury, as well as to Turkish President Recep Tayyip Erdogan, that there is no other choice,” he said.

Turkey’s central bank on Tuesday announced new stimulus measures for the financial sector and economy, and also said that it will increase government debt buying while offering new avenues for cheap funding.

“Resources are running out, I don’t think the current strategy is sustainable,” said Timothy Ash, a London-based senior emerging markets strategist at Bluebay Asset Management.

“So the options are to let the Turkish lira find its own level, or try to replenish foreign exchange reserves either with Fed swap line or an IMF program,” he told Arab News.

According to official figures, thousands of struggling Turkish firms, especially in the food, tourism and manufacturing sectors, have applied to state authorities for compensation payments for about 420,000 employees.

More than 400,000 companies in Turkey have been closed because of lockdown measures against the pandemic. In a country that already has 4.5 million unemployed, a further two million people are expected to become jobless in the near future.