Swaziland: The King's Monopoly

Telecoms

Last week, employees of the Swaziland Posts and Telecommunications Corporation (SPTC) became the latest group to go on strike in the public sector in Africa’s last remaining absolute monarchy. The protest was a reaction to the decision by the International Court of Arbitration (ICA) to hold the SPTC in violation of a Joint Venture  Agreement with Swazi MTN (MTN), the only other company trading in the telecommunications sector.

Yet many claim the Joint-Venture Agreement lacks legitimacy. It prevents SPTC from expanding into specific areas such as internet data services and fixed phone tariffs - designed to secure a trading monopoly for MTN in the most lucrative areas of the telecommunications. And the deal has attracted further controversy because an "esteemed shareholder" in MTN is suspected of having used his influence to obtain the signatures of SPTC officials. That shareholder is believed to be King Mswati III. 

Raiding the community chest 

This case bears a wider significance than simply upholding the legal interests of one company. It shows the willingness of a narrow elite to enrich themselves to the detriment of a majority.

Xolile Dlamini* told Think Africa Press that she could not understand why an international body deemed an agreement so clearly skewed in the interests of one party worthy of protection. 

The SPTC, by diversifying its business ventures and providing some competition with MTN, brought significant benefits to consumers. While Swazi MTN charges higher rates than anyone else in the region, it is renowned for poor service delivery - internet modems will frequently lose connection, services will be down and text messages are often undelivered. 

Those who previously could not afford to use MTN were able to take advantage of the lower rates offered by the SPTC. And a continued SPTC presence would have put real pressure on MTN to both review its pricing strategy and improve its provision of services.

However, with the SPTC no longer allowed to provide these services, many Swazis face a return to life without basic ways of communicating that are taken for granted in so many countries around the world.

Public sector revolt

The Joint-Venture Agreement, signed in 1998, was not left to chance. Official papers claim that MTN's "esteemed shareholder", who owns a 10% stake in the company, used his power to force the deal through under conditions of duress. By ensuring that SPTC does not move into the more profitable areas of internet and telephone services it allows a company that the king is invested to operate without accountability - to charge higher prices and capitalise on the growing interest in mobile phones and the internet.