Government Explains Causes of Sierratel’s Financial, Operational Crisis

Government officials have outlined the challenges facing Sierratel, pointing to heavy debt burdens, outdated infrastructure, and long-term operational decline as key factors behind the company’s current situation.

Speaking on behalf of the government, the Minister of Employment, Labour and Social Security, Mohamed Rahman Swaray, said that when the current administration took office in 2018, Sierratel was already in a severely weakened state. He described the company as being in “advanced stages of decomposition and decapitation,” with significant financial obligations, including salary arrears, end-of-service benefits, leave allowances, and union-related debts.

He further noted that Sierratel also owed substantial sums to suppliers and foreign creditors, including over 35 million US dollars owed to banks, debts which he said the government is currently servicing.

The Minister of Communication, Technology and Innovation, Salima Monorma Bah, explained that Sierratel’s upgrade to CDMA technology in 2014 initially improved services, particularly internet connectivity and mobile operations. However, she said the system later became obsolete as the global telecommunications industry transitioned to GSM technology, contributing to the company’s decline.

She added that as operations weakened, Sierratel lost customers and revenue, resulting in financial distress and the accumulation of salary arrears and other obligations.

According to the ministers, the combination of debt, outdated infrastructure, and declining operations has been central to Sierratel’s ongoing crisis.

While officials did not announce a specific revival timeline or support package, they said government efforts are focused on stabilizing the company as part of broader reforms in the telecommunications sector.