Maravi

Zamtel sale is a mockery

Zamtel sale is a mockery
By Business Post Editor
Tue 15 June 2010, 08:00 CAT

There is something fundamentally wrong with the manner in which the privatisation of Zamtel’s 75 per cent stake has been carried out.

We say this because the problem stretches from our country’s ability to handle decent and transparent privatisation process to its likely negative impact on the domestic telecommunications sector. The problem with this rather expeditious privatisation casts a serious doubt of the credibility of the process.

And it is sad that this government has not taken time to properly explain the whole process to the Zambian people from the time RP Capital Partners of Cayman Islands was contracted to carry out valuation work of Zamtel’s assets. That was the beginning of a process that many Zambians to date question. It is very clear that the sale of 75 per cent shares in Zamtel have been done dubiously for the benefit of a few individuals whose main interest is to enrich themselves.

We also wonder why this government never came out in the open to disclose how much had been agreed upon as the price for Zamtel’s 75 per cent shares. It is a mockery to offer such a huge asset at US$257 million, such an incredibly low price.

Therefore, the price that has been agreed upon between the Zambian government and the Libyans Lap Green Network is gross understated if you consider that Vodafone of the UK paid US $900 million for 70 per cent stake in Ghana’s Telecom, a country where there were other six operators. Zamtel has been grossly undervalued in view of modernisation and existing assets.

The government must, as a matter of urgency, release RP Capital’s evaluation report on the asset of Zamtel. Ghana’s population is 23 million people and there are six other operators. Therefore, the growth prospects are even slimmer than here where we have got only two foreign companies.

At a time when our country is going through difficult and high periods of uncertainty, we would have expected key regulatory institutions such as the Zambia Information and Communications Technology Authority (ZICTA) and Zambia Competition Commission (ZCC) to act. But even then, they appear as mere spectators because Rupiah Banda and those in the inner circle have usurped the power from these statutory bodies.

The most abused, of course, is the Zambia Development Agency (ZDA) which was called to launder this dirty process. We say so because how do you describe Rupiah’s directive that no new mobile phone licences should be allowed into the country's telecommunication sector until Lap Green Network settles down?

To add insult to the injury, the government of Rupiah has enacted a law by Statutory Instrument prohibiting the offer of new licences until 2015. This is very strange. This government is definitely out to protect interest of foreign investors only against their own people.

How could the government of Rupiah rush to offer the country’s huge assets for only US$257 million when the majority of citizens are wallowing in poverty and living on less than a dollar a day? Anyway, this is what is expected in a country where corruption is the order of the day. We will not be surprised to learn that the remaining parastatals – Zesco Limited, ZISC and Zampost – have been lined up for sale to foreign investors who are willing to offer our people peanuts.

We still remember how the Zambians opposed the sale of more than 70 per cent shares in Zanaco to Rabobank as this was against the law. After a long struggle, the government listened and reduced the offer to 49 per cent.

We therefore wonder why the government of Rupiah has refused to listen to cries of many Zambians and instead proceed to offer three quarters of Zamtel’s assets to a foreign company.

We also question government’s decision to quickly slash the international gateway fee to US$340,000 from US$12 million. This is definitely in a bid to offer the new owners of Zamtel more powers in its operations and an easy access to the property.

Labels: CORRUPTION, PRIVATISATION, ZAMTEL

posted by MrK @ 12:57 PM