Chad remains one of the least developed on the African continent, recent economic difficulties have been exacerbated by civil unrest and by an influx of refugees from neighbouring countries. While telecom infrastructure is particularly poor, with penetration rates in all sectors – fixed, mobile and internet – well below African averages. Nevertheless, despite difficult operating conditions, large scale poverty and low spending power, Chad’s telecom market offers some potential for investors to develop services given the low starting base.
The two main operators Tigo (now Moov) Chad and Airtel Chad have invested in infrastructure and have become the main providers of voice and data services. However, the difficult economic conditions of the country, compounded by taxes on telecom services which have adversely affected customer spend and operator revenue, encouraged these players to consider exiting the market.
The tax on mobile operators has been increased in stages in recent years, from 4% in 2014 to 7% in 2016. In January 2018 it was increased again, to 9%. Of this, the Treasury received 4%, the regulator 2.5%, the Information and Communication Technologies Development Agency (ADETIC) 1.5%, the National School of Information and Communication Technologies (ENASTIC) 0.6% and ANSCIE 0.4%. In addition to this tax an 18% excise duty was introduced in 2016 on telecom services, which resulted in lower usage among subscribers and consequently a negative impact on operator revenue. This tax was removed under the 2020 Finance Act
Chad finally gained access to international fibre bandwidth in 2012, but it still lacks a national backbone infrastructure to support efficient broadband services. However, the World Bank-funded Central African Backbone (CAB) project has made progress, and Chad is also party to a Trans-Saharan Backbone project which will link a fibre cable to Nigeria and Algeria.
The mobile sector has developed steadily under the auspices of Airtel Chad and Tigo Chad which together accounted for 99% of the users, while the national telco and fixed-line operator, Sotel Tchad (ST) operates the country’s third mobile network, as Salam Mobile. The latter is mainly focused on voice services, because it solely relies on 2G and offers only basic mobile data services. That's why it's not mentioned any further.
Mobile broadband networks started in 2014 and are still in their infancy. So far internet counts only for 10% of revenue and internet usage is the lowest among countries with comparable GDP per capita. In a survey 86% of the users considered internet access as slow, 6% as satisfactory and 8% as fast.
The difficult economic conditions of the country, compounded by several hikes of the tax on telecom services (9% in Jan. 2018) which has adversely affected customer spending and operator revenue, have encouraged the two major players to consider exiting the market. In 2017 Millicom was reported to be in discussions with the Orange Group regarding a potential sale, while Bharti Airtel announced that Chad was one of its regional markets which it considered offloading. The Chadian government has launched a tender in 2018 for the award of a fourth mobile licence and has invited interested parties to submit offers.
Maintaining cellular networks in Chad is difficult and expensive due to harsh weather conditions and erratic electricity. The market for handsets and tablets has not kept up with growing demand. Inexpensive handsets from Asia sold on the informal market are most common.
3G/4G coverage of population is around 25% with Tigo and Airtel, 4G/LTE is only available in major towns. According to the regulator towns are covered by 2G, and mostly 3G, rural areas and roads have long uncovered stretches. General GSM coverage of population is only around 85% by both providers equal to about 30-35% of the countries surface. In tests Tigo is a bit faster for data compared with Airtel.
Tigo by Luxembourg-based Millicom started its operations in 2005 and had become the market leader in Chad with a 56% share. It was the only provider that has launched 4G/LTE so far back in 2014 on 2600 MHz (B7) in the capital N’Djamena only.
Tigo Chad was acquired by Maroc Telecom, the largest telecommunications operator in Morocco, in 2019. The acquisition is part of Maroc Telecom’s plan to expand its operations in the region. It was rebranded as Moov.
Moov Africa Chad have announced plans to expand its mobile network and install fibre infrastructure in the capital to address growing demand for broadband access. Moov is set to increase the number of 3G and 4G sites on its network to 720 by the end of 2021, compared to 659 at end-2020 and will roll out fibre-to-the-home (FTTH) across N’Djamena in 2022. They are planning to 'make big investments to ensure that transmission is reliable across the country'.
Airtel (previously called Zain) and now owned by Indian Bharti Airtel is the 2nd mobile provider in the country with 43% of all users. 2G/GSM is on 900 and 1800 MHz, 3G/UMTS on 2100 MHz.
4G/LTE has started in N’Djamena, Bongor, Moundou, Sarh, Tine and Amdjarass.
The finance ministry of Chad has decreed that equipment related to telecom and internet services, including network equipment, devices, modems and routers, are exempt from import duties and taxes for the next five years.
The tax break is aimed at stimulating uptake of digital services by reducing the cost barrier to the public and thereby fostering a more active digital economy. TeleGeography reports that the high cost of mobile devices is frequently cited as a factor behind the low penetration rates of digital services in Chad and much of Africa.
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