There’s nothing sinister about Zamtel sale - Musokotwane

There’s nothing sinister about Zamtel sale - Musokotwane
By Mutale Kapekele in Lusaka and Misheck Wangwe in Kitwe
Wed 23 June 2010, 04:00 CAT

Finance minister Situmbeko Musokotwane has said he will apologise to the nation if Zamtel remained unprofitable two years from now.

But former Zambia Congress of Trade Unions (ZCTU) president Fackson Shamenda has said the privatisation of Zamtel to a Libyan parastatal, Lap Green Networks, is a clear indication that the MMD has failed to run government business.

Speaking when he was featured on Radio Phoenix’s Let the People Talk programme yesterday, Dr Situmbeko said there was nothing sinister about the Zamtel privatisation and expressed optimism that the company would be profitable in a few years.

“LAP Green will create a new company that will serve the public by contributing to the treasury and help the country prosper through tax,” Dr Musokotwane said.

“In two years, if the company fairs badly, I will apologise to the nation but if it does well, please come and say thank you.”

When reminded by a caller that the manner in which Zamtel was privatised would haunt the current government in future, Dr Musokotwane said he was not scared of prosecution and dared those with specific complaints to report to relevant authorities.

“There is nothing to be scared of. I have never been involved in shoddy transactions and I am not going to start now. If anyone has a specific issue, he is free to approach the relevant authorities about it. I can even provide them with transport if they can to my office to go and complain anywhere in the world, now and in future. I am absolutely unscared,” he said. “Zambians should manage their emotions when dealing with this topic.”

Dr Musokotwane said workers at Zamtel would have joined the ranks of those at Nitrogen Chemicals of Zambia (NCZ) had the company not been privatised.

“That is why workers at Zamtel are very happy with the sale,” he said.

Dr Musokotwane also disclosed that once the sell of the 75 per cent Zamtel shares was finalised, the government would make public the details of the privatisation.

“Zamtel is not yet bought. Conditions precedence still applies just like when you are selling a second hand vehicle, you agree first to certain things before you can finally sell. What remains is fulfillment of conditions like leniences,” he said.

“Hopefully, at the end of the month, everything will be finalised and the company will be handed over to LAP Green. Before that conclusion, the details of the transaction cannot be released. At the appropriate time, there will be a full ministerial statement to parliament, Zambia Development Agency (ZDA) represented by commerce minister Felix Mutati, will appear before a select parliamentary committee and they will be a government gazette notice with all the details.”

Dr Musokotwane said it was premature to talk about the details of the sale and that the government did not release the RP Capital valuation report to avoid bidders finding out the value of Zamtel.

“The valuation report is never released because bidders will bid around that figure which makes the seller to lose the opportunity to obtain a higher value. It’ only a guideline for the seller,” Dr Musokotwane said.

“Zamtel got the best value possible. It is not true to say it was undervalued because the market determines the price. The same happened during the sale of Zanaco and the Mosi-o-tunya Hotel in Livingstone (which was sold to Sun International) but look what has happened now. Everybody is happy and those places are making profits. LAP GreenN has a healthy balance sheet that is strong enough to secure jobs and create confidence.”

He said parastatal companies like Zamtel, slowed the economy as decisions were made slowly because of the bureaucracy connected to the government.

“An economy in private hands represents the best opportunity for the people. The private sector is less wasteful but if you over politicise this issue, you will lose credibility and you will suffer in future,” he said.

“Those aspiring for government will one day be faced with the same decision. You will rejoice when the benefits are seen. Government is convinced that Zamtel will turn around. In 2000 when the mines were still with the government, copper production went down by 66 per cent but after privatisation, it has gone up again and jobs are secure.”

On the ZESCO optic fiber network, Dr Musokotwane said the line still belonged to the power utility company and that Zamtel had just partnered with the former to commercialise it.

He said profits realised from the optic fiber would be shared by the two companies and that it was up to the two to negotiate their shares.

Dr Musokotwane also clarified that Mwembeshi Power station was sold along with other Zamtel assets and that it was up to the new owners to decide what to do with it.

Dr Musokotwane said RP Capital would get their five per cent commission for their work, after auditors finalised their work and when liabilities were subtracted from the gross payment.

But in an interview yesterday, Shamenda - who is also former Postal, Telegraph and Telephone International Union representative in charge of Africa - said it was shameful that Zamtel had been privatised because of the government’s failure in making institutions that are in government hands viable.

He wondered what government business President Rupiah Banda and his Cabinet ministers were running if they had failed to put in place deliberate policies to enhance the viability of Zamtel.

“They have sold Zamtel which is a parastal to Lap Green Networks which is a parastatal in Libya. The question we should have asked ourselves is: what is it that the Libyan government has done which we did not do to our Zamtel for it to be viable? This shows that the Libyan government has done well to sustain their parastatals and what we needed was simply to learn something and make radical decisions to revive the company. So the selling off of Zamtel simply means government has failed to perform its duties of ensuring that the company remains viable,” Shamenda said.

He said the government was expected to restructure management and the operations of Zamtel to enhance its effectiveness so that it could favourably compete with other private network providers unlike selling it off to another foreign parastatal without due considerations.

He said government’s hurried privatisation of Zamtel raised a lot of suspicions and people were wondering whether the whole process was done in a transparent manner or a few individuals had vested interests.

Shamenda further said it was regrettable that the government had sold the company at a give-away price of US $257 million as if the country was not proud of its massive investments in Zamtel.

He said the unilateral decision by President Banda and his government to sell Zamtel at a give-away price was unfair to Zambians who had vested interests in the company.

Shamemda said it was distressing to note that when other countries such as Ghana which sold Ghana Telecoms had regretted the sale of its national telecommunication asset after discovering that it was a disaster and was fighting to reclaim it, the Zambian government remained adamant despite opposition to the sale of Zamtel.

Shamenda said many African countries had made drastic changes in their privatisation strategies and strategic parastatals were being left in government hands as a way of ensuring that the citizenry had a say in the running of national assets.

He said Zambians were raising concerns and displeasure over the manner privatisation of Zamtel was handled because the nation did not reach consensus over the sale of the parastatal.