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Telecom firms fear capex liquidity bottlenecks

Bonn, April 28, 2009

A number of the telecom companies in the Middle East and North Africa (Mena) see capital expenditure (Capex) liquidity bottlenecks as a real threat to growth amid the global economic crisis, said a study.

According to the study conducted by consulting company Detecon International, two-third of the industry managers regard the lack of liquidity as a problem in their main operating market.

Around 60 per cent of the respondents in the survey do not expect any large-scale declines in demand among end customers and rule out the possibility of price wars in this segment as well.

'Majority of the respondents, both in Mena and Europe, dismiss a price war threat. So we believe that Mena carriers will evade really harsh negative impacts,' pointed out Carsten Schroeder, author of the study and managing partner corporate
finance at Detecon.

The situation in the business customer segment displays stability, although the possibility that companies will reconsider or postpone larger investments cannot be excluded,' he noted.

However, more than one-third of the industry managers surveyed said they were yet to notice any negative effects on their core business. 'The telecommunications industry in the Mena regions shows little inclination to be pessimistic,' the study added.

At the same time, the general economic environment is having fallout in the telecommunications industry when the question of saving money comes up, it said.

'Exactly half of the respondents in the study, which was conducted in all of Europe and the Mena region, see ways to draw out long-term investments in some areas, an opportunity the companies want to exploit for the improvement of their own financial position,' Schroeder added.-TradeArabia News Service




Tags: Mena Telecom | liquidity | Capex |

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