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Viewing cable 06ABUJA1517, NIGERIA TELECOM STRIKE ENDS BRIEFLY, RESUMES

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Reference ID Created Released Classification Origin
06ABUJA1517 2006-06-16 06:17 2011-08-25 00:00 UNCLASSIFIED Embassy Abuja
VZCZCXRO1017
PP RUEHMA RUEHPA
DE RUEHUJA #1517/01 1670617
ZNR UUUUU ZZH
P 160617Z JUN 06
FM AMEMBASSY ABUJA
TO RUEHC/SECSTATE WASHDC PRIORITY 6113
INFO RUEHOS/AMCONSUL LAGOS 4365
RUEHZK/ECOWAS COLLECTIVE
RUEHC/DEPT OF LABOR WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
UNCLAS SECTION 01 OF 02 ABUJA 001517 
 
SIPDIS 
 
SIPDIS 
 
USDOC FOR 3317/ITA/OA/KBURRESS 
USDOC FOR 3130/USFC/OIO/ANESA/DHARRIS 
DOL FOR ANN ZOLLNER 
TREASURY FOR DAN PETERS 
STATE PASS USTR 
 
E.O. 12958: N/A 
TAGS: ECPS ELAB ECON ETRD EINV PGOV NI
SUBJECT: NIGERIA TELECOM STRIKE ENDS BRIEFLY, RESUMES 
 
REF:  ABUJA 1462 
 
1. Summary.  The strike shutting down NITEL ended the 
evening of June 13, then resumed the afternoon of June 14 as 
NITEL workers again walked off the job.  A new union, the 
National Association of Telecommunications Employees, termed 
as inadequate the GON's offer of 1.7 billion naira (about 
$13.3 million) in overdue salary and allowances.  Telephone 
service, however, seemed to improve throughout the country 
on June 15.  Embassy Abuja and Consulate Lagos's USG-owned 
satellite communications with Washington remained 
unaffected.  The Nigerian telecom sector's total losses in 
revenue from the strike already exceed several billion 
naira.  Further labor unrest was on the horizon as employees 
of the Power Holding Company of Nigeria (PHCN) threatened to 
strike starting June 30 and cause a nationwide blackout if 
the GON proceeded with its planned privatization.  End 
summary. 
 
2. Confusion reigned within Nigeria's telecommunications 
sector on June 14 as the strike shutting down state-owned 
Nigerian Telecommunications (NITEL) ended the evening of 
June 13, then resumed the afternoon of June 14 as NITEL 
workers again walked off the job.  NITEL employees are 
striking to demand the payment of back wages and allowances. 
 
Breakaway union demands full payment of arrears 
--------------------------------------------- -- 
 
3. The leadership of the National Union of Post and 
Telecommunications Employees (NUPTE) and the Senior Staff 
Association of Utilities, Statutory Corporations, and 
Government Companies (SSAUSGOC) agreed to end their strike 
on June 13.  However, a faction of the NITEL employees 
rejected this settlement and formed a new union, the 
National Association of Telecommunications Employees (NATE), 
which proclaimed the Government of Nigeria's (GON) offer of 
1.7 billion naira (about $13.3 million) inadequate compared 
to arrears of N4.2 billion ($23.3 million).  NATE's 
leadership contended that many NITEL workers no longer 
trusted NUPTE and SSAUSGOC to represent their interests and 
thus formed the new union.  Embassy telecom contacts 
reported that part of the tension within telecom workers' 
ranks is NITEL's looming privatization.  Many NITEL 
employees are determined to receive all overdue pay and 
allowances before the company is sold.  The workers fear 
that debts otherwise owed them will not survive NITEL's 
privatization. 
 
4. NATE President Charles Amankwe told the press June 14 
that his union would not accept "half measures" from the 
government concerning money owed to his members.  Amankwe 
called on NITEL's customers to pay their debts to the 
company.  He said private telecommunications operators 
(PTOs) owed NITEL significant amounts.  Amankwe also claimed 
that some of these PTOs have never paid any money to NITEL, 
which "is not how business is done."  Labor contacts of the 
Lagos consulate said June 15 that NATE is controlling the 
strike, is insisting on a full payment of arrears, and that 
the stoppage may last longer than several days.  Some labor 
experts said the strike could last an additional two weeks 
or longer if the government does not resolve the issue of 
arrears completely. 
 
5. Telecom contacts of the Lagos consulate reported June 14 
that NITEL's national secretary confirmed the GON released 2 
billion naira ($15.6 million) -- sufficient to cover three 
months' overdue salaries -- as well as 625 million naira 
($4.9 million) for overdue furniture allowances for the past 
year.  NITEL is considering releasing a press statement 
warning all PTOs that they must pay all interconnectivity 
debts owed to NITEL or be disconnected.  For its part, NITEL 
claimed the GON, state governments, local governments, and 
PTOs owe NITEL about 89 billion naira ($695 million), at 
least 70 percent of which is overdue interconnectivity fees 
from PTOs. 
 
6. The sources added that the Ministry of Communications and 
NITEL's management believe NITEL can be self-sufficient if 
PTOs and other customers pay their bills on time.  Telecom 
experts, however, are skeptical, citing NITEL's endemic 
management problems and poor morale as recurring barriers to 
the company's delivering good service.  The analysts said 
the impact of these strikes clearly had harmed NITEL's 
 
ABUJA 00001517  002 OF 002 
 
 
value. 
 
Telephone service improves 
-------------------------- 
 
7. Service on the MTN cellular network, used by embassy 
staff, resumed the evening of June 13 when a technical fault 
was corrected.  Many calls could not get through on NITEL or 
M-Tel lines, while service provided by Globalcom, MTN, and V- 
Mobile remained erratic.  All NITEL lines in Lagos and Abuja 
had been switched off, but on the afternoon of June 15 
(local time), NITEL lines started to work again in Lagos and 
Abuja -- and service was supposed to resume across the 
country.  The improvement in NITEL service did not result 
from a resolution to the strike, NITEL officials told the 
embassy.  Embassy Abuja and Consulate Lagos's USG-owned 
satellite communications (data circuitry) with Washington 
remained unaffected by the strike. 
 
Economic losses mount 
--------------------- 
 
8. Cellular provider Starcomms told the Lagos consulate on 
June 15 that losses in revenue from the strike cost the 
company more than 350 million naira ($2.7 million).  Other 
PTOs are turning to alternative satellite backup links, but 
the strike continued to cost them money.  Global System for 
Mobile Communications operators said the Nigerian telecom 
sector's total revenue losses from the strike exceeded 
several billion naira. 
 
Power Holding Company workers warn of pending strike 
--------------------------------------------- ------- 
 
9. Further labor unrest could be on the horizon as employees 
of the Power Holding Company of Nigeria (PHCN) threatened to 
strike starting June 30 and cause a nationwide blackout if 
the GON proceeds with its planned privatization of the 
company.  Joe Ajaero, general secretary of the National 
Union of Electricity Employees, told the media on June 12 
that the government was not consulting with his members 
about the privatization, and that the GON's intention to 
"reform" the PHCN on June 30 was impractical.  He said 
privatizing the electricity sector was unwise when it 
generated fewer than 4,000 megawatts.  The Bureau of Public 
Enterprises, which is overseeing the PHCN's privatization, 
estimated in 2005 that the company suffered generation and 
distribution losses of 40 percent, with the resulting power 
outages costing the country roughly $1 billion per year. 
ANYASO