24 May 2019

Cameroon: Former Camtel D-G David Nkoto Emmane Is Under Investigation for Two Corruption Allegations, Forbidden to Leave the Country

analysis

London — Widely published corruption allegations against the former D-G Camtel provide an interesting snapshot of what can go wrong in state-owned telcos. Russell Southwood looks at the charges and what they mean for the wider processes of telecoms reform.

On 14 December 2018 the Cameroonian Government sacked Camtel D-G David Nkoto Emmane and the Chair of the Board Victor Nfon Mukete by Presidential Decree. The latter is a 93 year-old senator, former Minister of Information and father of Colin Ebako Mukete. Mukete Jr is the Chair of MTN Cameroon in which he has a 30% stake.

Nkoto was replaced as D-G by Judith Yasonde Achidi who was appointed by presidential decree on the same day as the sacking. She is the wife of the first anglophone Prime Minister of Cameroon , Simon Achidi Achu. He served in government from 1991-1994. Before becoming D-G, she was the Commercial Director at Camtel.

David Nkoto Emane is in what one regional publication CIO described as "the clutches of the hawk operation initiated as part of the fight against corruption". The former D-G has been accused of corruption between 2010 and 2015 and it has been dubbed Operation Sparrowhawk.

The most recent investigation against him by the Special Criminal Court for corruption concerns the proposed Camtel Mobile Network. The former D-G put this project together for a 4G mobile network and it was presented as a way of safeguarding Camtel's future.

In order to carry out the project, the former D-G asked for money from the Ministry of Economy, Planning and Spatial Planning (Minepat), which was then run by the current Minister of Public Works, Emmanuel Nganou Djoumessi. According to local media reports, the Minister asked that the project be directed by his son Boris Judicaël Nganou, who is also being investigated alongside the former D-G.

According to local media reports, nearly FCFA3 billion (around US$5 million) was transferred from the Ministry to Camtel but the project was never completed.

The second investigation concerns a contract signed with the ANYPOL Group in 2010 to produce a telephone directory of Camtel subscribers. Despite having received all the necessary funds to produce it ANYPOL did not deliver on the contract until 2013, one year beyond the two-year contract period. The D-G did not sanction the company for late delivery. In 2017 an investigation was conducted by a team from the state audit oversight organization CONSUPE that revealed the non-delivery. The state audit oversight body also previously noted other irregularities in the payment of the bills to those who carried out the feasibility study for the Camtel 4G operation in Cameroon.

Finally the former D-G is also under investigation for unjustified company expenses and his expenses for overseas missions. CONSUPE produced a report in 2016 saying that there had been FCFA4 billion (US$6.8 million) of unjustified expenditure at the company.

Although there were unreliable rumours that he had fled the country to Equatorial Guinea, he is still in Cameroon and has been forbidden to leave the country since 2 March 2018. A report in Cameroon Web on 23 April 2019 hints that his position may have come under threat when he started pursuing parts of Government - both national and local - for non-payment of bills.

And as the saying goes, it never rains but it pours. Alongside all of this wahala about the former Camtel D-G, there is an on-going dispute at Viettel with its local shareholder. According to a report on 17 May 2019 Vietnam's Deputy Minister of Foreign Affairs, Nguyen Quoc Cuong, had met with the Prime Minister of Cameroon, Joseph Dion Ngute, to resolve the dispute.

The Vietnamese military owned Viettel Group owns 70% of the Cameroon company and the local investor Baba Danpullo holds 30% through a company called Bestinver Cameroon.

Danpullo was originally a trucker and owner of several market stalls but got import licences for rice and flour. His other investments include a large tea estate (part of a controversial privatization), real estate (including malls and buildings in Nigeria, France, Switzerland and South Africa) and transportation (in state-owned companies such as Sodecoton and Aéroports du Cameroun). According to Forbes magazine he is worth FCFA 547 billion. He is also a significant contributor to the ruling CPDM party.

The dispute involves issues such as signatures for financial transactions, the recruitment of staff, engagement of foreign partners, the purchase of telecoms hardware, and technology transfers. In November 2018, the Ministry of Employment and Vocational training accused Nexttel of visa irregularities for its Vietnamese employees, including its top managers. Following the meeting between the two Ministers, it was reported that Government will launch an enquiry to investigate the dispute and propose a resolution to end it.

Cameroon was the subject of a major World Bank programme called the Central African Backbone Project. It aimed to provide assistance to privatize Camtel in 2008. The Project Performance Assessment Report (4 June 2018, Report 126034) noted that:"Implementation did not proceed because of political refusal." Subsequent efforts were made to create a separated out wholesale PPP but these also had failed by April 2014. Camtel retains a monopoly on wholesale networks and landing stations and is widely regarded by other operators in the market as very inefficient. There are three bright spots: the number of people using the internet has increased, both wholesale and retail prices have gone up and the amount of bandwidth used per person has increased. However, these changes have largely been market driven and have been in spite of Camtel's contribution to the changing market.

Events at Nexttel would make major new international investors hesitate to get involved in what might otherwise be a promising market. It is perhaps too optimistic to hope that the elderly President Biyi will at last do the right thing and privatize Camtel and let go of the tight rings of political patronage that festoon parts of the telecoms sector.

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