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Zimbabwe: Mnangagwa's administration steps in to reform telcos

Zimbabwe: Mnangagwe's administration steps in to reform telcos

Zimbabwe is to partially privatise state-owned telecom companies - TelOne, NetOne and Telecel - as President Emerson Mnangagwe's administration intervenes to open up the economy to private investors.

The country's Finance Minister Patrick Chinamasa said Friday morning that the move to privatise and commercialise loss making and struggling state parastatals and other public entities was intended to "enhance performance" and to "improve service delivery" by the companies.

Chinamasa explained that the government has given the go-ahead for public companies to merge, privatise and commercialise.

Government owned fixed phone operator TelOne and state run mobile operator NetOne have been classified under government companies that are earmarked for "partial privatisation".

Telecel Zimbabwe, in which the government has a majority stake after buying out VimpelCom, will also be partially privatised.

Government will also merge its internet service provision companies Zarnet, Powertel and Africom.

"Detailed implementation modalities of each of the cabinet decisions will be provided in the form of a memorandum... by each respective line ministry, including indications, where necessary for the engagement of technical, financial or legal advisors in order to facilitate the reform or restricting process agreed by cabinet," added Chinamasa.

Although data usage and the mobile phone industry in Zimbabwe have outpaced fixed phone usage, TelOne MD Chipo Mutasa believes landlines are still an important telecom platform.

TelOne, which also holds (but is not utilising) the fourth mobile network license, is seeking to raise fixed phone subscriber numbers.

Zimbabwe is also preparing to bring on board virtual network operators among other developments that could exert pressure on fixed phone usage.

"We hope that we can grow it (landline subscriptions) back to 300,000 and beyond in the next couple of years because the landline is still a very relevant service and people want convenience and affordability," Mutasa said recently.

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