Tanzania’s government and MSI/Detecon will appoint an independent expert in a last ditch effort to end a dispute over outstanding dues for a stake in a state-owned telecoms firm, officials said last week.

The expert, to be appointed at a later date, will look into controversial accounts which are the basis of a deadlock between the government and a consortium of Germany’s Detecon and Mobile Systems International (MSI), Tanzania’s chief secretary Martin Lumanga told a news conference.

MSI/Detecon paid US$60 million in February 2001, half payment for a 35 percent stake in Tanzania Telecommunications Company Ltd. (TTCL), and agreed to pay the remaining $60 million by December 2001. But the consortium has not paid the second trache of $60 million to date and has asked for a review of TTCL’s 2000 accounts, Tanzania officials said.

The two shareholders cannot agree on accounting for some 115 billion shillings ($115 million) worth of uncollected revenues in 2000, which MSI says are unlikely to ever be collected in view of their age. "We have reached an impasse. We could not agree on certain figures on debtors and the collectibility of the debt," MSI Chairman Sir Alan Rudge said at the joint news conference.

In August last year, MSI/Detecon lodged an application for arbitration in London, further deepening the rift and sparking fears that the privatisation of TTCL would be jeopardised. But the parties have now decided to negotiate out of court.

"Our two sides have reached the conclusion that we need to appoint an independent international expert to look into TTCL accounts for the year 2000 and advise as appropriate," Lumanga said.

"We have also committed ourselves to abiding to the experts determination as final so we can move forward to more investments in Tanzania," he added. He said that once appointed, the expert would have one month to complete the task. Lumanga said the expert would not be a national of Tanzania, United States or the Netherlands to avoid conflict of interest.