‘Re-nationalise Telkom’ says SA workers union
- Published on 30 August 2012
South Africa’s Communication Workers Union (CWU) has called on the country's government to reverse the privatisation of telecoms operator Telkom.
The union’s calls follows the country’s National Development Plan (NDP) proposals related to the Information Communications and Technology (ICT) sector, and, in particular, those related to Telkom, which is listed on the Johannesburg Stock Exchange (JSE).
The NDP proposed that Telkom be split into a a wholesale unit, focusing on backhaul operations, and a retail telecoms business to better serve SA’s ICT needs.
And CWU National Spokesman, Matankana Mothapo, said this possible plan for Telkom could kick-start government’s nationalisation of the fixed-line unit.
South Africa’s government owns almost 40% of Telkom, making it the company’s largest stakeholder. Furthermore, the Government Employees Pension Fund holds a further 10.89% stake in the firm.
"It is unacceptable for the government to compete with itself,” said Mothapo.
“Therefore merging its infrastructural investments makes sense. This will therefore require the state to return Telkom to 100% ownership by the state,” he added.
The union blamed the problems afflicting the ICT sector in South Africa to failure to implement policies proposed by the ruling party.
“Universal access and service should also be the key objective of new policy development initiatives to ensure that the digital divide is eliminated between rich and poor, urban and rural, suburb and townships.
"The ANC’s 3rd National General Council in 2010 laid a very good foundation for a new paradigm shift for the ICT sector and the lack of implementation by government of ANC policies is the main reason for the ICT conundrum in South Africa," Mothapo said.
Market sentiment regarding Telkom has been hard-hit this year following the SA government’s rejection of Korea Telecoms bid for a 20% stake in the firm.
Also, South Africa's Competition Tribunal earlier this month fined Telkom R449 million ($55 million) for 'bullying' its competitors in a market abuse case stretching back to 2004.
The case specifically looked at the period between 1999 and 2004, a time in which Telkom was a monopoly provider of fixed-line telecommunications services in the country.
Telkom, though, has announced today that it is to appeal the fine.