MTN Group Considers Price Increases to Tackle Inflationary Challenges in Africa
MTN Group, Africa's largest wireless carrier, is facing inflationary pressures in its markets and is considering price increases in certain countries to navigate these challenges.
The telecom company, operating across 19 countries including South Africa, Nigeria, and Ghana, acknowledged the impact of rising inflation on its operations in its recently released first quarter report for the year.
During the first quarter, inflation across MTN's footprint averaged 18.5%, compared to 11.5% the previous year. In response, MTN stated that it would engage in discussions with regulators regarding the proposed price adjustments.
Factors such as Russia's conflict in Ukraine, currency depreciation due to pandemic-induced debt, and frequent power cuts in South Africa have contributed to inflationary pressures in MTN's markets.
Ghana, in particular, experienced inflation of over 50% earlier this year, and interest rate hikes have made it more challenging for consumers to afford credit. Despite the challenges, MTN reported a 15% increase in revenue to R53 billion in the first quarter.
As part of its simplification strategy, the company also revealed plans to potentially exit its operations in some key West African markets including Guinea-Bissau, and Guinea-Conakry.
