Menu
Zambia starts the hunt for international operator to invest in Zamtel

Zambia starts the hunt for international operator to invest in Zamtel

Telecom sector woes reflect those of other countries in Africa

Three years after Zambia repossessed incumbent operator Zamtel from Libya’s LapGreen Networks, the Zambian government has started hunting for an international operator to invest in the company.

Zamtel, like many other incumbent operators in Africa, is losing money. Last month, the Zambian government said Zamtel needs US$300 million for it to become viable, but that it doesn’t have the money to recapitalize the company. This has forced the Zambian government to start the hunt for an international telecom company to invest in Zamtel in order to save it from closing.

The problems facing Zamtel underlines the difficulties that other African governments have in keeping incumbent operators in business. Zamtel was sold to LapGreen Networks in 2010 for US$257 million by the previous administration. In 2012 however, the current Zambian administration repossessed Zamtel from the Libyans, on grounds that the company was illegally sold by the previous administration. It accused the prior government of corruption in a range of deals, including the sale of Zamtel.

But minister of Communications and Transport, Yamfwa Mukanga, has revealed that the Zambian government is once again hunting for an international telecom operator to invest in the company. Mukanga said government red tape has prevented Zamtel from competing against private operators in the sector, including South Africa’s MTN and India’s Bharti Airtel.

“We want to bring another investor on board to assist us run and improve the operations of Zamtel because currently, Zamtel is making loses and not in good shape financially,” said Mukanga in an interview this week.

Zamtel is the number-three operator in the country. MTN is currently Zambia’s largest telecom operator with 51 percent market share, followed by Airtel.

In Zimbabwe, the situation is not different from that of Zamtel. The Zimbabwean government is also facing difficulties in running NetOne profitably in the face of stiff competition from private operators who are technologically advanced and have sufficient cash to invest.

In a bid to improve the operations of NetOne, the Zimbabwean government is sacking almost the entire management at the company, accusing it of incompetence. The Zimbabwean government claims in has invested US$500 million in the company to date.

Zimbabwe’s minister of ICT, Supa Mandiwanzira, said NetOne has relied too much on government funding.

Edith Mwale, telecom analyst at Africa Center for ICT Development said it is difficult for incumbent operators to make a profit because most government officials are using their services without paying for them.

“A good example is Zambia and Zimbabwe. The Zimbabwean government owes NetOne over US$10 million while the Zambian government owes Zamtel about US$4 million. This money has to be paid for these companies to be viable,” said Mwale via phone.


Follow Us

Join the New Zealand Reseller News newsletter!

Error: Please check your email address.

Featured

Slideshows

Consegna comes to town with AWS cloud offerings launch in Auckland

Consegna comes to town with AWS cloud offerings launch in Auckland

Emerging start-up Consegna has officially launched its cloud offerings in the New Zealand market, through a kick-off event held at Seafarers Building in Auckland.​ Founded in June 2016, the Auckland-based business is backed by AWS and supported by a global team of cloud specialists, leveraging global managed services partnerships with Rackspace locally.

Consegna comes to town with AWS cloud offerings launch in Auckland
Veritas honours top performing trans-Tasman partners

Veritas honours top performing trans-Tasman partners

Veritas honoured its top performing partners across the channel in Australia and New Zealand, recognising innovation and excellence on both sides of the Tasman. Revealed under the Vivid lights in Sydney, Intalock claimed the coveted Partner of the Year 2017 (Pacific) award, with Data#3 acknowledged for 12 months of strong growth across the market. Meanwhile, Datacom took home the New Zealand honours, with Global Storage and Insentra winning service provider and consulting awards respectively. Dicker Data was recognised as the standout distributor of the year, while Hitachi Data Systems claimed the alliance partner award. Photos by Bob Seary.

Veritas honours top performing trans-Tasman partners
An Evening With Eugene Kaspersky for Kiwi partners in Auckland

An Evening With Eugene Kaspersky for Kiwi partners in Auckland

​New Zealand partners came together for An Evening With Eugene Kaspersky in Auckland, an invitation only event as part of Kaspersky Lab Partner Engage. Following an evening of insights and executive networking with the founder of Kaspersky Lab, Eugene Kaspersky, Kiwi partners got up close and personal with Eugene in an unprecedented​ panel discussion. Facilitated by Reseller News, this panel explored channel relationships, successful business strategies, and the latest ground breaking technologies to impact the security market. Photos by Maria Stefina.

An Evening With Eugene Kaspersky for Kiwi partners in Auckland
Show Comments