Middle East tensions, trade wars threaten Ghana’s telecom boom, MTN warns

MTN Ghana has warned that escalating geopolitical tensions in the Middle East, growing trade fragmentation and persistent global supply chain disruptions could undermine Ghana’s economic recovery and slow the momentum that has powered one of the telecom operator’s strongest financial performances in recent years.

The caution came despite the company reporting robust half-year earnings, underscoring how Africa’s telecom operators are increasingly vulnerable to global events even as domestic economic conditions improve.

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Speaking alongside the company’s interim results, Stephen Blewett, MTN Ghana chief executive officer said the second half of 2026 would likely be shaped less by domestic policy and more by external economic shocks.

“Looking ahead to the second half of 2026, the global operating environment remains highly uncertain. While the global economy continues to demonstrate resilience, geopolitical tensions in the Middle East, ongoing supply chain disruptions and rising trade fragmentation remain key risks to growth, inflation, energy markets and global financial conditions,” Blewett said.

The warning reflects a growing concern across Africa’s telecommunications industry, where operators depend heavily on imported network equipment, data centre infrastructure, smartphones and energy supplies. Any disruption to global shipping routes or renewed inflationary pressures could raise operating costs and delay network expansion.

Ghana’s recovery powers telecom growth

MTN Ghana’s caution comes against the backdrop of a significantly improved domestic economy.

Average inflation fell sharply to 3.8 percent during the first half of 2026 from 20.4 percent in the corresponding period last year, while macroeconomic stability boosted consumer spending and business confidence. Although the Ghanaian cedi weakened by 8.6 percent against the US dollar, the pace of depreciation was far less severe than previous years.

The improved environment translated into strong demand for digital services.

Service revenue rose 32.3 percent year-on-year to 15 billion Ghanaian cedis, driven by higher data consumption, increased mobile money usage and stronger engagement across its digital platforms.

Earnings before interest, tax, depreciation and amortisation (EBITDA) climbed 39.8 percent to 9.3 billion cedis, while profit after tax increased 43.3 percent to 5.1 billion cedis.

The operator also crossed a major milestone, growing its subscriber base by 8.5 percent to 32.8 million customers.

Active data users increased 13.7 percent to 19.9 million, reflecting Ghana’s growing digital economy, while active Mobile Money (MoMo) users rose to 18.3 million.

Global risks replacing local challenges

The results mirror a broader trend emerging across MTN Group’s operations.

For much of the past three years, African telecom operators battled soaring inflation, sharp currency devaluations and weakening consumer purchasing power.

Now, those domestic pressures are easing in several markets, including Ghana, but are being replaced by risks originating outside the continent.

Conflicts in the Middle East have heightened concerns over global energy prices and shipping costs, while increasing trade restrictions between major economies threaten supply chains for telecommunications equipment ranging from fibre-optic cables to radio access network hardware.

For operators planning aggressive investments in 5G, cloud infrastructure and artificial intelligence-ready networks, any increase in equipment costs could pressure capital expenditure budgets.

Fintech separation strengthens growth strategy

MTN Ghana also said its standalone fintech business is beginning to demonstrate the strategic benefits of its structural separation completed during the first quarter of 2026.

The company formally carved out its mobile money business into a separate entity with its own management structure, customer base and financial reporting, aligning with MTN Group’s broader strategy of unlocking value from its financial technology operations across Africa.

Blewett said the move positions the business to capitalise on growing financial inclusion and the rapid digitisation of payments.

“The continued expansion of our fintech platform, coupled with the successful structural separation completed in Q1 2026 and our inclusive ecosystem play, positions the business well to capture the opportunities arising from increasing financial inclusion, digitisation of payments, and the growing demand for accessible digital financial services across Ghana,” he said.

The company invested 2.1 billion cedis in network infrastructure during the period, reinforcing its commitment to expanding digital connectivity despite an uncertain global outlook.

Legal dispute emerges

The strong financial performance, however, was overshadowed by a legal dispute involving Ghanaian technology company Clydestone Ghana.

MTN Ghana said it had been served with a writ of summons alleging the unauthorised use of intellectual property relating to the origins of mobile money services in Ghana, claims the operator strongly denies.

According to the company, the issues date back nearly two decades and will be vigorously contested in court.

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The announcement triggered a sell-off in shares of parent company MTN Group in South Africa, highlighting investor sensitivity to legal risks surrounding one of Africa’s most valuable fintech businesses.

Still, MTN Ghana declared an interim dividend of three pesewas per share, while the standalone fintech business announced an additional three pesewas, bringing the total interim payout to six pesewas per share.

The company’s biggest challenge is no longer Ghana’s economy, but a rapidly changing global landscape where wars, trade disputes and supply chain disruptions could determine the pace of Africa’s digital transformation.