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‘Zain, MTN shouldn’t participate in Zamtel shares purchase’

‘Zain, MTN shouldn’t participate in Zamtel shares purchase’
Written by Chiwoyu Sinyangwe
Tuesday, August 18, 2009 2:51:53 PM

ZAIN Zambia Plc and MTN Zambia should not participate in the purchase of 75 per cent Zamtel shares to allow the entry of another company, Zambia Competition Commission (ZCC) stated yesterday. Commenting on the pending sale of three quarters of the country’s biggest Information Communication Technology (ICT) company, ZCC stated that the entry of a new player would enhance competition in Zambia’s telecommunication sector.

ZCC stated that it supported the partial privatisation of Zamtel, observing that the move was expected to enhance efficiency and effective competition in the telecommunication industry.

“We envisage enhanced competition in the telecommunications sector should we have a new entry through the partial privatisation,” ZCC director for Consumer and Public Relations, Brian Lingela was quoted in the official press statement.

“We would like to see another independent company other than MTN or Zain take over the assets of Zamtel as this will greatly increase competition in the telecommunication sector.”

And ZCC stated that state owned companies in a fast changing telecommunication sector would always offer little competition because they were protected by government and received subsidies, conditions that did not foster a competitive spirit in the management of such companies.

“ZCC also expects that once Zamtel operates as a competitive business, it is likely to result into lower tariffs for consumers and increased coverage particularly for Cell Z subscribers,” ZCC stated.

“Over the past few years, for example, Cell Z, a Zamtel subsidiary has remained a ‘sleeping giant’ and has not been aggressive in expanding its coverage to most rural and urban areas. This situation has provided insignificant competition to other providers such as Zain and MTN. In its current state, the company would have to exit the telecommunication market if it operated within a competitive environment to the detriment of consumers.”

ZCC also urged the government to revise laws governing the telecommunication sector in order to ensure that all companies operating in the sector were placed on an equal footing for effective competition to occur.

Labels: COMPETITION, MTN, PRIVATISATION, ZAMTEL, ZCC

posted by MrK @ 1:53 PM