MTN is in talks with US and South African authorities around how it can repatriate money from the country, which is currently under sanction from the US.
MTN owns 49% of Iran's second cellphone operator, Irancell, and the entity currently has 38 million subscribers. In the six months to June, it grew revenue 30% in local currency. Iran has been under increasing pressure from Europe and the US over its nuclear programme.
CEO and president Sifiso Dabengwa says the economy is under pressure due to the sanctions. He explains that, because of the sanctions, the Iranian financial sector is essentially cut off from the rest of the world and the group has not been able to repatriate money for the past six or seven months.
Dabengwa says international financial institutions do not interact with the Iranian banking sector, but the group is in talks with US and SA officials to find a solution to transferring money.
There is a general acceptance that US sanctions should not have unintended consequences for non-US companies, says Dabengwa.
MTN plans to invest R1.4 billion in capital in Iran this year as part of its R24 billion expenditure programme. Dabengwa says it is a challenge getting equipment into the country and paying suppliers because of the sanctions.
Previously, MTN would repatriate funds by working through “other” institutions and swapping cash with a company that has money outside Iran and needs internal funds.
However, the group has ceased this practice after being told by authorities that it was contrary to the sanctions, notes Dabengwa.
Share