MTN South Sudan to cut jobs amid economic crisis spurred by war

MTN South Sudan, a unit of Africa’s biggest mobile-phone company, said it’s cutting jobs and canceling expansion plans as the war-torn nation battles an economic crisis.

The workforce will be reduced from 170 people to just over 80, while plans to construct 40 communication towers have been shelved, according to Khumbulani Dhlomo, the company’s head of corporate services. The company has invested as much as $170 million in the country over the past two years, without seeing profit, he told reporters Tuesday in the capital, Juba.

“We have seen a decrease in our customer base,” he said. “People now have to choose between buying a phone, buying airtime and buying bread.”

Oil-producing South Sudan has seen its currency collapse and inflation surge since conflict erupted in December 2013 and curbed crude output. The International Monetary Fund projected the economy would contract 5.3 percent last year. The landlocked country has sub-Saharan Africa’s third-largest crude reserves and currently pumps about 160,000 barrels a day.

“The biggest challenge is the exchange rate of the U.S. dollars,” Dhlomo said. “It’s either the U.S. dollars are too expensive for the company or not there.”

– Bloomberg