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<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><B style="mso-bidi-font-weight: normal"><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>Social Impact of mobile phone<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" /><o:p></o:p></FONT></SPAN></B></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>By Mutwiri Mutuota<o:p></o:p></FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>NAIROBI, Kenya, September 27- In the often stated world order, innovation is ‘ordained’ to flow from Western nations to their Southern counterparts.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>However, the mobile phone industry has provided the South, particularly Sub-Saharan Africa, the rare opportunity to impart on their illustrious Western counterparts pioneering advancements in Information and Communication Technology (ICT) that if replicated worldwide, the social impact would be astronomical.<o:p></o:p></FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>On Monday night, a report released by GSMA, the umbrella body of all mobile phone operators worldwide in Nairobi spelt out the staggering scale of what Government initiatives aimed at promoting mobile phone use can have on their populations.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>The GSMA conducted two studies, titled Mobile Telephony and Taxation in Kenya and Mobile Taxation: Surtaxes on International Incoming Traffic where the positive and inhibitive impact government policy can have on the advancements of the industry were spelt out.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>In the first report, the decision by the Kenyan government in June 2009 to exempt mobile handsets from Value Added Tax (VAT, pegged at 16 percent in the country) spurred unprecedented growth in the industry that in turn accelerated economic growth.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>That pronouncement was made by the country’s Minister for Finance, Uhuru Kenyatta, tucked in his long annual budget speech and its importance was lost at the moment. <o:p></o:p></FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>“The social impact has been astounding. Economic growth has been boosted by eight percent in Kenya as an example with services such as M-Pesa and Airtel Money making such a huge difference in people’s lives,” Gabriel Solomon, the Head of Public Policy at GSMA said.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>He was alluding to the mobile money transfer services pioneered by Kenya’s leading communication service provider, Safaricom (M-Pesa) and rivals Airtel (Airtel Money) who followed suit with the concept catching on worldwide.<o:p></o:p></FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>“It has improved production efficiency and social cohesion tremendously and such an impact can be replicated worldwide if mobile phone and mobile broadband technology is adopted worldwide,” Solomon added.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>According to the report, the economic impact of the growth in mobile telephony in Kenya has seen contribution to the Gross Domestic Product (GDP) shoot up by whooping 250 percent since 2006 with the industry expected to churn some $3b (Ksh300 billion) or 5.6 percent of the entire GDP to the nation’s breadbasket in 2011.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>The decision to slash VAT on mobile handsets has led to a 200 percent growth in sales in the past two years. It also saw the market expand to include two other Mobile Network Operators (MNOs) namely Orange and Essar (YU Mobile) added to the Safaricom and Airtel duopoly.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>The corresponding price drop on the handset pegged at 70 percent has seen mobile coverage increase to cover 96 percent of the population, one of the highest penetration rates worldwide.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><SPAN style="mso-spacerun: yes"> </SPAN>“Kenya and sub-Saharan Africa have shown to be leaders in innovation in the developed world and we are seeing a shift of innovation from the South to the West and this levels the playing field if ultimately replicated worldwide with the world doing business,” Solomon remarked.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>Subsequently, MNOs in the country have played their part in motivating the growth in productivity of the country’s economy as a whole by contributing such increases by providing services such as mobile banking, M-Agriculture and M-Education in addition to initiating a number of social projects in Kenya’s rural areas.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>Events such as the annual Safaricom Lewa Marathon held at the Lewa Downs Wildlife Conservancy where besides promotion of the rare black Rhino at the 5,000 acre lush of Savannah in Northern Kenya, the race also raises money for eradication of eye disease trachoma among the nomadic Samburu community.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>“The experience of the Kenyan government’s removal on taxation on handsets indicates there could be significant benefits for consumers from removal of mobile specific taxes,” the report features.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>On the other side of the spectrum, the second study on Surtaxes on International Incoming Traffic (SIIT) illustrated the adverse effects state levies on mobile telephony were having on particularly rural African society that continues to be left behind by the digital boom.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>Gabon and Congo Brazzaville have borne the brunt of the introduction of SIIT by their governments with the price of inbound mobile call traffic rising by 111 and 82 percent in that order. </FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>“MNO in Senegal noted that the number of international call minutes terminated on its network decreased each month the taxation is in place when the prices rose by 50 percent,” the report cited.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>Similar reversals were witnessed in Ghana where prices rose by 58 percent when SIIT was introduced where in addition to the reduction of incoming calls, operators in African countries are reciprocating by higher termination prices.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>Of more worrying concerns, the findings state, “Operators have reported significant cases of illegal traffic since the introduction of SIIT. This takes away the revenue from operators and governments since illegal SIM boxes work in a way that congests a disproportionate amount of spectrum and reduces the average quality of service for illegal calls.”</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>“Governments should liberate the mobile phone industry to allow private sector investment for the benefit of the consumer as Kenya demonstrated by dropping the tax on mobile phone handsets,” Solomon asserts.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>During the launch of the report where Kenya was cited as a model example of government’s active involvement in advancing mobile telephony, the country’s Information and Communication Minister, Samuel Poghisio, noted; <o:p></o:p></FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>“The world should think of mobile technology as an agent of social development and there is need to worry about cyber security and such steps are for the sake of mankind.”</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>While proclaiming the country was in the process of rolling out an ambitious M-Education and M-Health programme, he added, “We should think of the mobile phone as an agent of rural development.”</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><B style="mso-bidi-font-weight: normal"><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>While the figures stated above are beyond the comprehension of the commoner, Jane Mwai, who owns a small stall for mobile phone handsets and accessories in Kinoo, a settlement 15km from Nairobi’s Central District perhaps best sums the impact of devices whose stated average weight are given between 200 to 800 grams.</FONT></SPAN></B></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><B style="mso-bidi-font-weight: normal"><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN></B> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>“Before I ventured into mobile phone business three years ago, I used to operate a shop on this very premises that was not bringing much and I had to rely more on my husband,” she narrates.</FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri><o:p></o:p></FONT></SPAN> </P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><FONT face=Calibri>“However, since I changed to phones, I’m making enough to keep me going and with my savings, I’m looking forward to opening another stall in Kikuyu (some 5km away). Every day, there is a new mobile product in the market and customers are always there so I made the right choice,” she added.<o:p></o:p></FONT></SPAN></P>
<P style="MARGIN: 0in 0in 10pt" class=MsoNormal><SPAN style="LINE-HEIGHT: 115%; FONT-SIZE: 16pt" lang=EN-GB><o:p><FONT face=Calibri> </FONT></o:p></SPAN></P><BR> <BR>-----------------------------------------------------------------------------------<BR>If you have the strength to survive, you have the power to succeed. Life is all about choices we make depending upon the situation we are in. Go forth and rule the World!<BR> </div></body>
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