According to a Korea Times report, this review will likely result in the scaling down or scrapping of the company’s activities in Rwanda and other countries on the continent.
Under the leadership of outgoing Chairman Lee Suk-chae, Korea’s second-largest mobile carrier signed an agreement in March 2013 to invest $140 million in Rwanda to build a fourth-generation (4G) mobile network that will serve 95 percent of the country’s population.
The investment, however, is being questioned as it takes quite a long time to generate profits. Since signing the agreement, the company has sought to expand its footprint in other countries including Kenya and Uganda.
“One of the key priorities for the upcoming CEO is to recover KT’s telecommunications-related business. Synergy will be maximized only after realizing business structures that can generate profit in a stable manner regardless of market situations,” one KT official told Korea Times, adding moves are already under way to realign its overseas business projects.
“The new CEO will re-examine our African business projects from a zero-base,” he said.
The review of the overseas projects comes on the back of KT officials feeling the pinch in its domestic market as its globalization efforts are seen to have sacrificed its competitiveness locally.
“The outgoing CEO was busy following ‘trendy business projects.’ KT should set short-term, mid-term and long-term targets if it wants to earn results from overseas business projects that the company is involved in,” said Chang Joon-hyuck, senior vice president at Atlas Research and Consulting.