State-owned Telenor under scrutiny after doing business with dictators

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Norwegian Trade Minister Trond Giske is now among those demanding some answers from state-owned Telenor over the business it does with dictatorships in Central Asia. Newspaper Dagens Næringsliv (DN) has reported that some critics claim Telenor has “blood on its hands” because of the business done through its ownership stake in Russian mobile phone firm Vimpelcom.

Telenor chief executive Jon Fredrik Baksaas just emerged from a mobile licensing fiasco in India and now faces questions over the company’s involvement in Central Asian nations that are ruled by dictators. PHOTO: Telenor

DN, which has been publishing a series of articles about the Vimpelcom/Telenor activity in Central Asia that’s prodding Norwegian politicians into action, hasn’t managed to get many answers itself out of Telenor, Vimpelcom or the companies’ partners in countries including Uzbekistan, considered “one of the worst dictatorships in the world” by Human Rights Watch. Telenor’s operations through Vimpelcom in Uzbekistan, Tajikistan, Kazakhstan and Kyrgyzstan are shrouded in secrecy and Telenor officials have refused to even release the names of Vimpelcom’s partners in Central Asia. They cite confidentiality agreements Vimpelcom signed in order to secure the business. Vimpelcom officials say they’re judicially bound by the confidentiality agreements.

Critics worry the secret agreements shield alleged corruption, with the licensing fees and other sums Vimpelcom has paid to conduct its mobile phone service ultimately landing in the pockets of Central Asian rulers and their families. DN has documented several cases where that appears to be the case. Leaders of several Norwegian human rights organizations, Transparency International and opposition politicians are thus raising questions, also to Giske, the government minister in charge of the state’s investments in commercial business. The Norwegian government still owns 54 percent of Telenor.

What’s worse, according to leading human rights advocates and opposition leaders in the various Central Asian countries, the mobile phone service that Vimpelcom/Telenor provides is subject to widespread surveillance, with conversations tapped by the authorities, who then allegedly arrest and even torture those they see as threats to their power. A Vimpelcom spokesman confirmed to DN that all operators in Uzbekistan, “both national and international,” must install special equipment that makes it possible to monitor network traffic in Uzbekistan. “This is a legal requirement and Vimpelcom follows local laws and regulations where the company operates,” Bobby Leach, information director for Vimpelcom, told DN.

Mutabar Tadjibaeva was imprisoned and abused in Uzbekistan, on charges of being a threat to the regime, after her mobile phone conversations were tapped. She now lives in exile in France. PHOTO: Wikipedia

Mobile firms ‘as guilty as the regime’
Mutabar Tadjibaeva, Uzbekistan’s most well-known human rights champion who had to flee the country after being imprisoned and assaulted for challenging the country’s ruler, President Islam Karimov, told DN that Karimov and his feared state police get help from the mobile phone companies to eavesdrop on conversations, track down and persecute critics of the regime.

“All my conversations were closely controlled by the security forces and I had to continually change my SIM cards,” said Tadjibaeva, who now lives in exile in France after she was imprisoned on charges of planning to topple the regime. She said she was gang raped in prison, held in isolation in freezing cells with no warm clothing and forced to undergo operations where vital organs were removed. She claims no one can speak freely in Uzbekistan because the security forces get information from the mobile phone firms, which she thinks have blood on their hands.

“They (the mobile firms) contribute to the oppression of democracy and human rights activists,” she told DN. “They put the lives of activists in danger and give the regime a lot of strength. When they cooperate with a dictatorship, they’re as guilty as the regime.”

Telenor, though its 35.7 percent stake in Vimpelcom, is a co-owner of Uzbekistan’s largest mobile phone provider Unitel. Both Vimpelcom and TeliaSonera of Sweden are competing to be the biggest providers in Uzbekistan after both bought mobile licenses to do business in the country from a small firm based in Gibraltar called Takilant Ltd.

DN reported that Swedish police, investigating Telia Sonera’s payments to Takilant, have tied Takilant to Gulnora Karimova, daughter of Uzbekistan’s president, although she has denied that. Swiss authorities are also investigating and froze several hundred million Swiss francs held by Takilant. The Swedish authorities have alerted Norwegian police to their investigation, with an eye to possible cooperation.

Meanwhile, DN reported last week that Vimpelcom’s entry into the former Soviet republic of Tajikistan occurred after Vimpelcom bought a mobile phone firm from the brother-in-law of President Emomali Rakhmon, who has held power since 1992. The country’s regime is also known for its use of torture, the muzzling of dissidents and journalists and corruption, but Telenor’s chief executive refused to comment on Vimpelcom’s activity there.

Meanwhile Vimpelcom continues to expand in Uzbekistan, not least after another Russian firm, MTS, lost its licenses and had to turn over millions of dollars worth of assets to the state over what MTS called “false charges” against it. MTS’ experience in Uzbekistan doesn’t bode well for Vimpelcom and other foreign firms doing business there, but both Telenor and Vimpelcom seem willing to take the risk, along with agreeing to the authorities’ demands such as those involving surveillance, in return for potential profits.

Trade Minister Trond Giske, who got into a major dispute with Telenor earlier this year, is now under pressure to probe the state-controlled company’s dealings in countries like Uzbekistan. PHOTO: newsinenglish.no

Trade Minister Giske wasn’t willing to talk to DN about Telenor’s involvement in Central Asia, but has responded to questions from Members of Parliament, saying he has received a briefing from Telenor on how they’re monitoring their role in Vimpelcom and that Giske’s staff will follow up Telenor’s “community responsibility.” Giske otherwise referred questions to Telenor.

Telenor officials have remained mostly unwilling to discuss details of their operations through Vimpelcom in Central Asia. The company did confirm a “routine” meeting between Telenor CEO Jon Fredrik Baksaas last week, at which Giske was “oriented” on the issues reported in DN’s series.

Telenor’s board of directors has also asked for a briefing from management on the issues, which will be given at the board’s next meeting, according to Telenor.

Vimpelcom officials maintain that their investment in Uzbekistan “has brought mobile communication to a broader segment of the population who earlier hadn’t experienced the advantages of freedom to use mobile technology, which other places regard as a fundamental human right.”

Vimpelcom’s spokesman Leach wrote in an e-mail to DN that “we think that the delivery of mobile communication by an international, reliable and respected company like Vimpelcom furthers democracy where we operate.”

Authorities in Uzbekistan and Tajikistan didn’t answer questions posed by DN.

Views and News from Norway/Nina Berglund

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