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'No money left': Lebanese telcos close to meltdown as cable thieves thrive

Thursday, January 13, 2022

By Laila Bassam and Timour Azhari

BEIRUT (Reuters) - Lebanon's telecom duopoly, once cash cows for the state, used to allocate most of their spending on wages, rent and infrastructure.

Now revenues have nosedived, and the biggest cost for Alfa and Touch is diesel for the power generators that - with the country's economic meltdown causing national blackouts on top of a currency crash - they use to run the creaking telecom network.

"We are in crisis management mode without being able to look at all at long-term problems or see what the overall solutions are because we're distracted by daily matters," Telecoms Minister Johnny Corm told Reuters. "We are living day by day."

While global telecoms operators compete on offers for subscribers or building 5G networks, Lebanon's mobile firms - which both returned to state hands in 2020 - are focused on more mundane matters such as stopping the regular theft of their network tower cables.

"Every day there is a robbery," Corm said. "It has reached the point that we contact municipalities to ask for help because the security services no longer have the capacity."

Last year, when Lebanon's ailing power grid was just about on its feet, generator fuel made up 7% of the telecom sector's expenses. That is projected to soar to two thirds of the budget this year, the minister said.

Wages are forecast to fall to 10% of costs from one third - a measure of how revenues are now being eaten up by costs and how employees' spending power has shrunk.

In dollar terms, those revenues are just 5% of their level before the crisis erupted in 2019, showing the extent of the collapse of the Lebanese pound, which has made imported equipment cripplingly expensive.

The minister said Touch made the equivalent of $850 million in 2018, when Lebanon's pound was at 1,500 to the dollar. Based on the current exchange rate of 31,000, that shrank to the equivalent of $45.5 million in 2021.

Corm said the companies had to review prices to keep operating and avoid draining the state's already almost empty coffers.

However, any price adjustment needs cabinet approval, he said, which adds complications as ministers have not met for three months amid a dispute over a probe into Beirut's huge port blast in 2020.

Internet outages and weak mobile signals plague the system, but Corm suggested the outlook for any improvement was bleak, with as many as half of the two firms' employees failing to turn up for work. For some, wages don't even cover transport costs.

Revenues from telecoms were in decline before the crisis, Corm said, a fall often blamed on corruption. But the minister said the impact of graft was now dwarfed by the economy's collapse.

"When there was a lot of corruption there was a lot of money," he said. "Today there is no money left."

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16-01-2022 22:16:45 (UTC+7)

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 EUR/USD1.1416Neutral
 GBP/USD1.3677↑ Buy
 USD/JPY114.43↑ Buy
 AUD/USD0.7209↑ Buy
 USD/CAD1.2541↑ Sell
 EUR/JPY130.62↑ Buy
 EUR/CHF1.0443Sell
 Gold1,817.90Neutral
 Silver22.953↑ Buy
 Copper4.4205Buy
 Crude Oil WTI83.50↑ Sell
 Brent Oil86.12↑ Sell
 Natural Gas4.336↑ Sell
 US Coffee C239.65↑ Buy
 Euro Stoxx 504,272.19Buy
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 DAX15,883.24↑ Buy
 FTSE 1007,542.95Sell
 Hang Seng24,212.00↑ Buy
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 IBEX 358,806.60↑ Buy
 BASF68.110Sell
 Bayer52.59↑ Sell
 Allianz227.00↑ Sell
 Adidas252.35Buy
 Lufthansa7.241↑ Buy
 Siemens AG145.86Neutral
 Deutsche Bank AG11.954Sell
Mua/Bán 1 chỉ SJC
# So hôm qua # Chênh TG
SJC Eximbank6,120/ 6,160
(0/ 0) # 1,155
SJC HCM6,115/ 6,175
(15/ 5) # 1,170
SJC Hanoi6,115/ 6,177
(15/ 5) # 1,172
SJC Danang6,115/ 6,177
(15/ 5) # 1,172
SJC Nhatrang6,115/ 6,177
(15/ 5) # 1,172
SJC Cantho6,115/ 6,177
(15/ 5) # 1,172
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Sản phẩmVùng 1Vùng 2
RON 95-IV2400024480
RON 95-II,III2390024370
E5 RON 92-II2291023360
DO 0.05S1838018740
DO 0,001S-V1873019100
Dầu hỏa1719017530
ↂ Giá dầu thô thế giới
WTI$83.46+0.380.45%
Brent$85.58+0.460.53%
$ Tỷ giá Vietcombank
Ngoại tệMua vàoBán ra
USD22.540,0022.850,00
EUR25.234,8826.649,42
GBP30.246,4531.537,99
JPY192,66203,94
KRW16,5020,10
Cập nhật lúc 10:10:03 17/01/2022
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